Cyprus is not a tax heaven. It is a highly respectful jurisdiction and its status was considerably improved after its accession to the EU. As a result registration of new International Business Companies (offshore) were significantly increased since 2004 and inwards.
Cyprus companies can trade with any country in the world and can use the Double Tax Treaties, the EU Directives on interest, royalties and subsidiaries. Combined with the lowest corporation tax of 12,5% in EU and the several tax exemptions of the Cyprus legislation renders Cyprus one of the most popular jurisdictions.