Source: EURLEX
Language: en
Format: md

**Council of the**
**European Union**

**Interinstitutional File:**

**2023/0416(NLE)**

**COVER NOTE**

**Brussels, 16 November 2023**
**(OR. en)**

**15554/23**
**ADD 1**

**ECOFIN 1193**
**FIN 1172**
**UEM 359**

From: Secretary-General of the European Commission, signed by Ms Martine
DEPREZ, Director

date of receipt: 16 November 2023

To: Ms Thérèse BLANCHET, Secretary-General of the Council of the
European Union

No. Cion doc.: COM(2023) 735 final

Subject: ANNEX to the Proposal for a COUNCIL IMPLEMENTING DECISION
amending Implementing Decision (EU) (ST 10686/21 INIT; ST 10686/21
ADD 1) of 20 July 2021 on the approval of the assessment of the
recovery and resilience plan for Cyprus

Delegations will find attached document COM(2023) 735 final.

Encl.: COM(2023) 735 final

15554/23 ADD 1 JGR/sr

## ECOFIN 1A EN

EUROPEAN

COMMISSION

**ANNEX**

_**to the**_

Brussels, 16.11.2023
COM(2023) 735 final

ANNEX

**Proposal for a COUNCIL IMPLEMENTING DECISION**

**amending Implementing Decision (EU) (ST 10686/21 INIT; ST 10686/21 ADD 1) of 20**

**July 2021 on the approval of the assessment of the recovery and resilience plan for**

**Cyprus**

{SWD(2023) 377 final}

# **EN EN**

**ANNEX**

**SECTION 1: REFORMS AND INVESTMENTS UNDER THE RECOVERY AND**

**RESILIENCE PLAN**

**1.** **Description of Reforms and Investments**

**A.** **COMPONENT** **1.1:** **R** **ESILIENT AND EFFECTIVE HEALTH SYSTEM** **,** **ENHANCED CIVIL**

**PROTECTION**

This component of the Cypriot Recovery and Resilience plan addresses the challenge of universal
access to high-quality healthcare in Cyprus as well as civil protection’s overall emergency
preparedness and response. The objective of this component is to strengthen the effectiveness,
accessibility and overall resilience of the healthcare sector supporting the recently introduced
National Health System through various interventions. These include the (i) modernisation and
digitalisation of health care infrastructure and equipment, (ii) stepping-up of e-health services, (iii)
accreditation of provided health care services and introduction of evidence-based clinical protocols
and quality monitoring systems, as well as (iv) upskilling opportunities for health workers. It further
aims at enhancing Cyprus’ civil protection system by establishing a modern Public Warning System.

The component addresses the country-specific recommendations on health (country-specific
recommendation 1 of 2020 and country-specific recommendation 3 of 2019).

**A.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C1.1R1): National Centre for Clinical Evidence and Quality Improvement

The objective of the reform is to enhance the quality and sustainability of the healthcare system.

For this purpose, a National Centre for Clinical Evidence and Quality Improvement shall be
established. A team of experts in collaboration with the Ministry of Health and the Coordinating
Committee for the National Centre for Clinical Evidence and Quality Improvement will develop
evidence-based medicine (EBM) clinical guidelines, protocols and pathways for all levels of care
(primary, secondary and tertiary healthcare) in close cooperation with healthcare professionals and
patients. Monitoring and evaluation processes such as clinical audits, peer reviews and inspections
shall also be developed. Furthermore, an IT system enabling implementation and monitoring of the
clinical standards and protocols and including an e-learning platform shall be developed.

The implementation of the reform shall be completed by 31 December 2025.

Reform 2 (C1.1R2): Design of an Electronic platform for the surveillance of Nosocomial Antibiotic
Consumption and Healthcare – Associated Infections

The aim of the reform is to support the digital transition of the healthcare sector and strengthen the
health system’s effectiveness and resilience.

It shall consist of the development of an electronic platform to process data from hospital pharmacies
(nosocomial antibiotic consumption), microbiology laboratories (antimicrobial resistance), and
hospitals (healthcare-associated infections (HAIs)).

The implementation of the reform shall be completed by 31 December 2025.

1

Investment 1 (C1.1I1): New facilities for the Cyprus Blood Establishment and procurement of the
latest technology attendant equipment

The objective of the investment is to enhance central Blood Establishment operations in Cyprus.

This measure shall entail the construction of new facilities for the Cyprus Blood Establishment and
the procurement of the latest technology attendant equipment. About 80 000 blood products (such as
red blood cells, platelets and fresh frozen plasma) shall be able to be distributed for clinical use across
the whole country. The new facilities shall have a primary energy demand that is at least 20% lower
than defined in the nearly zero-energy building (NZEB) requirement.

The implementation of the investment shall be completed by 30 June 2025.

Investment 2 (C1.1I2): Cyprus Innovative Public Health information and communications technology
(ICT) System

The aim of the measure is to establish the Influenza Sentinel Surveillance module of the Cyprus
Innovative Public Health information and communications technology (ICT) System to support
public health sector bodies in making evidence-based decisions.

It shall include both the development of the necessary digital tools (such as software and ICT
infrastructure) as well as the upskilling of health workers and Ministry of Health personnel to use the
system for data collection and information extraction. Following the European Centre for Disease
Prevention and Control (ECDC) and World Health Organisation (WHO) guidelines, the Influenza
Sentinel Surveillance (ISS) module of the Cyprus Innovative Public Health ICT System shall record
epidemiological data informing the Ministry of Health of potential epidemiological outbursts. The
Ministry of Health shall assign 30 doctors as sentinels who shall enter data in the Influenza Sentinel
Surveillance (ISS) module of the Cyprus Innovative Public Health ICT System.

The implementation of the investment shall be completed by 31 December 2025.

Investment 3 (C1.1I3): Purchase/replacement of medical equipment in hospitals

The investment aims at enabling private hospitals to invest within a short timeframe in the
modernisation of their medical equipment increasing the quality of health services provided.

The measure shall comprise a support scheme for private hospitals supporting the upgrade or
replacement of medical equipment. Applications for funding shall be assessed based on transparent
selection criteria by a special Assessment Committee, which shall be appointed by the Minister of
Health.

The implementation of the investment shall be completed by 31 December 2025.

Investment 4 (C1.1I4): Accreditation of public and private hospitals

The objective of this investment is to support the accreditation of hospitals, enabling their registration
within the National Health System (NHS) and enhancing the quality assurance of health care services
provided.

It shall consist in a sponsorship scheme facilitating the accreditation of hospitals by covering part of
(i) the costs incurred by private and public hospitals related to accreditation advisory services from
external experts (on how to make the necessary preparations for the accreditation) and (ii)
accreditation fees charged by internationally recognised bodies.

The implementation of the investment shall be completed by 30 June 2026.

2

                                     Investment 6 (C1.1I6): Deployment of generic cross border e health services in Cyprus

The measure aims at extending e-health services to allow cross-border exchange of patient health
information (in particular patient summaries and e-prescriptions), to become part of a secure peer-topeer e-health network within the EU.

It shall consist in putting in operation a cross-border data exchange between Cyprus and Union
Member States with operational National Contact Points for eHealth (NCPeH), such as eprescriptions, e-dispensations, patient summaries, and additional data sets (amongst others discharge
forms, laboratory results and imaging) as agreed with the eHealth Digital Service Infrastructure
(eHDSI).

The implementation of the investment shall be completed by 30 June 2025.

Investment 7 (C1.1I7): Public warning system for supporting emergency operations through SMS

The objective of the investment is to enhance Cyprus’ civil protection system by establishing a
modern public warning system targeting the whole population through a mobile application to
increase public safety, preparedness and resilience.

The measure shall consist in putting in operation a public warning system reaching the whole
population through a mobile application or SMS for alerting on imminent or developing emergencies.

The implementation of the investment shall be completed by 31 December 2025.

3

**A.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|1|C1.1R1<br>National Centre<br>for Clinical<br>Evidence and<br>Quality<br>Improvement|Target|Clinical<br>protocols<br>prepared,<br>audited and<br>peer reviewed<br>|-|Number|0|50|Q4|2024|At least 50 clinical protocols for all levels of care<br>hall be prepared, audited and peer reviewed by a<br>team of experts, with key characteristics of<br>protocols being:<br>• evidence-based medicine (EBM) clinical<br>practice recommendations,<br>• implementation guide, <br>• audit plan.|
|2a|C1.1R1<br>National Centre<br>for Clinical<br>Evidence and<br>Quality<br>Improvement|Target|Clinical<br>protocols<br>prepared,<br>audited and<br>peer reviewed|-|Number|50|90|Q4|2025|At least 90 clinical protocols for all levels of<br>care, shall be prepared, audited and peer<br>reviewed by team of experts, with key<br>characteristics of protocols being:<br>• evidence-based medicine (EBM) clinical<br>practice recommendations,<br>• implementation guide, <br>• audit plan.|
|2b|C1.1R1<br>National Centre<br>for Clinical<br>Evidence and<br>Quality<br>Improvement|Milestone|Development<br>of IT system<br>including an e-<br>learning<br>platform<br>completed and<br>system is<br>operational|completion of<br>the<br>installation of<br>the IT system<br>and of<br>operation|-|-|-|Q4|2025|An IT system enabling implementation and<br>monitoring of clinical standards and protocols<br>and e-learning platform is developed and is<br>operational.|
|3|C1.1R2|Milestone|Adoption of<br>the list of|Adoption of<br>the list of|-|-|-|Q1|2023|Adoption of the list of healthcare facilities<br>Timeline: Q1 2023|

4

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||Design of an<br>Electronic<br>platform for the<br>surveillance of<br>Nosocomial<br>Antibiotic<br>Consumption<br>and Healthcare– <br>Associated<br>Infections||health care<br>facilities|health care<br>facilities||||||Description: Adoption of the list of health care<br>facilities that shall be providing information to<br>the Ministry of Health on antibiotic consumption<br>and healthcare-associated infections that shall be<br>monitored by the Ministry of Health.|
|4|C1.1R2<br>Design of an<br>Electronic<br>platform for the<br>surveillance of<br>Nosocomial<br>Antibiotic<br>Consumption<br>and Healthcare– <br>Associated<br>Infections|Milestone|Electronic<br>platform<br>including<br>monitoring<br>system is fully<br>operational|Electronic<br>platform up<br>and running|-|-|-|Q4|2025|Electronic platform to process data from hospital<br>pharmacies (nosocomial antibiotic<br>consumption), microbiology laboratories<br>(antimicrobial resistance), and hospitals<br>(healthcare-associated infections (HAIs)) shall<br>be fully operational (Installed at all points of use<br>and real data are being entered) and a system<br>monitoring its effectiveness shall be in place.|
|5|C1.1I1<br>New facilities for<br>the Cyprus<br>Blood<br>Establishment<br>and procurement<br>of the latest<br>technology<br>attendant<br>equipment|Milestone|Contract<br>signature for<br>the<br>construction of<br>the Cyprus<br>Blood<br>Establishment|Signature of<br>the contract|-|-|-|Q3|2022|Signature of the contract with the selected<br>tenderer(s) (contractor(s)) selected under a<br>competitive call for tenders for the construction<br>of the Cyprus Blood Establishment.|
|6|C1.1I1<br>New facilities for<br>the Cyprus<br>Blood<br>Establishment|Milestone|New blood<br>establishment<br>facilities<br>including all<br>equipment are|Completion<br>of the<br>construction<br>and start of<br>operations|-|-|-|Q2|2025|The new blood establishment facilities shall be<br>constructed and fully operational housing the<br>Cyprus Blood Establishment. The new facilities<br>shall have a primary energy demand that is at<br>least 20% lower than defined in the nearly zero-|

5

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||and procurement<br>of the latest<br>technology<br>attendant<br>equipment||fully<br>operational<br>|||||||energy building (NZEB) requirement. New<br>relevant equipment shall be operational and the<br>transfer of the existing equipment from the<br>present Blood Establishment premises to the new<br>facilities shall be complete.|
|7 <br>|C1.1I2<br>Cyprus<br>Innovative<br>Public Health<br>information and<br>communications<br>technology (ICT)<br>System|Milestone|Influenza<br>Sentinel<br>Surveillance<br>(ISS)System|Fully<br>operational<br>system|-|-||Q2|2022|The Influenza Sentinel Surveillance System<br>module of the Cyprus Innovative Public Health<br>information and communications technology<br>(ICT) System shall be operational and a system<br>monitoring its effectiveness shall be in place.|
|8|C1.1I2<br>Cyprus<br>Innovative<br>Public Health<br>information and<br>communications<br>technology (ICT)<br>System|Target|Sentinels<br>entering data in<br>the Influenza<br>Sentinel<br>Surveillance<br>System module|-|Number|0|30|Q4|2025|Following the European Centre for Disease<br>Prevention and Control (ECDC) and World<br>Health Organisation (WHO) guidelines, the<br>Influenza Sentinel Surveillance System (ISS)<br>module of the Cyprus Innovative Public Health<br>ICT System shall record epidemiological data<br>entered in the online digital platform by general<br>practitioners (GPs) to inform the Ministry of<br>Health of potential outbursts. The Ministry of<br>Health shall assign at least 30 doctors as<br>sentinels that shall enter data in the ISS module<br>of the Cyprus Innovative Public Health ICT<br>System.|
|9|C1.1I3<br>Purchase/replace<br>ment of medical<br>equipment in<br>hospitals|Target|Health<br>institutions<br>having<br>benefitted from<br>the financial<br>support scheme|-|Number|0|10|Q4|2023|At least ten of the applicant health institutions of<br>various categories have received financial<br>support from the scheme for medical equipment<br>acquisition.|
|10|C1.1I3<br>Purchase/replace<br>ment of medical|Target|Health<br>institutions<br>having<br>benefitted from|-|Number|10|23|Q4|2025|At least 23 of the applicant health institutions of<br>various categories have received financial<br>support from the scheme for medical equipment<br>acquisition.|

6

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||equipment in<br>hospitals||the financial<br>support scheme||||||||
|11|C1.1I4<br>Accreditation of<br>public and<br>private hospitals|Target|Health<br>institutions<br>having<br>benefitted from<br>the scheme<br>covering<br>accreditation<br>related costs|-|Number|0|20|Q2|2025|At least 20 of the applicant health institutions of<br>various categories have been supported from the<br>scheme for gaining accreditation.|
|12|C1.1I4<br>Accreditation of<br>public and<br>private hospitals|Target|Health<br>institutions<br>having<br>benefitted from<br>the scheme<br>covering<br>accreditation<br>related costs|-|Number|20|45|Q2|2026|At least 45 of the applicant health institutions of<br>various categories have been supported from the<br>scheme for gaining accreditation.|
|13|C1.1I6<br>Deployment of<br>generic cross<br>border e-health<br>services in<br>Cyprus|Milestone|Completion of<br>the analysis,<br>design and<br>development<br>phase of the IT<br>System for<br>cross-border e-<br>health services|Completion<br>of the<br>analysis,<br>design and<br>development<br>phase of the<br>IT System, as<br>provided in a<br>dedicated<br>report by the<br>deliverables<br>acceptance<br>team in the<br>contracting<br>authority|-|-|-|Q4|2023|The analysis, design and development of the IT<br>System phase shall be completed.<br>Specifications shall include:<br> <br>a) Service Location and capability lookup Profile<br>/ the Cross-Community Patient Discovery Profile<br>(to locate communities that hold patient relevant<br>health data and the translation of patient<br>identifiers across communities holding the same<br>patient’s data). <br>b) open source National Contact Point<br>(OpenNCP) update that supports the eHDSI<br>Automatic Data Collection (eADC).<br>c) Update Patient Summary (PS-A), e-<br>Prescription (eP), e-Dispencing (eD),<br>unstructured clinical documents, and patient<br>access to cross border data services, based on<br>Wave 6 Clinical Document Architecture (W6|

7

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||CDA) Implementation Guidelines by the e-<br>Health network.<br>d) A new service shall also be created to enable<br>the exchange of structured and coded clinical<br>documents that may include medical<br>images/imaging reports, discharge reports,<br>laboratory results.|
|14|C1.1I6<br>Deployment of<br>generic cross<br>border e-health<br>services in<br>Cyprus|Milestone|Full operation<br>of cross-border<br>healthcare data<br>exchange|Approval of<br>the system by<br>the National<br>eHealth<br>Authority|-|-|-|Q2|2025|Full operation of cross-border data exchange<br>between Cyprus and countries with Operational<br>National Contact Points for eHealth (such as e-<br>prescriptions, e-dispensations, patient summaries<br>exchanged with Cyprus) and additional data sets<br>(such as discharge forms, laboratory results and<br>imaging) as agreed with eHealth Digital Service<br>Infrastructure.|
|15|C1.1I7<br>Public warning<br>system for<br>supporting<br>emergency<br>operations<br>through SMS|Milestone|Newly<br>established<br>public warning<br>system and its<br>monitoring<br>system are<br>fully<br>operational|The<br>Technical<br>Committee<br>signs off final<br>Systems<br>Acceptance<br>and go-live<br>Report<br>for the public<br>warning<br>system|-|-|-|Q4|2025|The public warning system shall be operational<br>and a monitoring system shall be in place<br>reaching the whole population through a mobile<br>application and/or SMS.<br>The terminal points machines for SMS sending<br>shall be fully operational.|

8

**A.3.** **Description of the reforms and investments for the loan**

Reform 3 (C1.1R3): Gradually shifting of the healthcare provision and reimbursement framework
towards value-based models

The aim of the reform is to introduce and gradually move to value-based healthcare models to
complement current volume-based healthcare models, to improve health outcomes and limit costs.

It shall consist in the development of appropriate value-based models and initiatives, with relevant
monitoring mechanisms to measure and track the success of the reform, and the introduction of valuebased models in the Reimbursement Decision for primary and in-patient care as per the General
Health System Legislation.

The implementation of the reform shall be completed by 31 March 2023.

Investment 5 (C1.1I5): Enhancement, modernisation and upgrade of Cyprus State Hospitals

The objective of this investment is to enhance, modernise and/or upgrade the Cyprus State Hospitals
to enable them to compete on an equal basis with the private sector whilst at the same time improving
the quality of healthcare services as well as working conditions for health workers in public hospitals.

This measure shall consist in the following actions to enhance, modernise and/or upgrade the State
Hospitals: (1) enhancement of the Makarios Hospital for Children to offer a complete treatment of
cases to children; (2) construction and/or extension of Haemodyalisis Unit at Paphos and Limassol
Hospitals; (3) construction of a Mental Health Hospital; (4) enhancement of the Limassol General
Hospital; (5) enhancement of the Paphos General Hospital; (6) extension of Invasive Radiology Unit
including medical equipment (such as Angiography Unit); and (7) construction of a COVID-19 Unit
at the Famagusta Hospital. The Haemodyalisis unit at Paphos Hospital, the new Mental Health
Hospital and the new building of Makarios Hospital for Children shall have a primary energy demand
that is at least 20% lower than defined by the nearly zero-energy building (NZEB) requirement.

The implementation of the investment shall be completed by 30 June 2026.

9

**A.4.** **Milestones, targets, indicators, and timetable for monitoring and implementation for the loan**

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|16|C1.1R3<br>Gradually shifting<br>the healthcare<br>provision and<br>reimbursement<br>framework towards<br>value-based<br>models.|Milestone|Value-based<br>reimbursement<br>to be reflected<br>for primary<br>and in-patient<br>care|Value-based<br>reimbursement<br>to be reflected<br>in the<br>Reimbursement<br>Decision|-|-|-|Q1|2023|Annual reimbursement decisions in the<br>general health system shall be adjusted to<br>include value-based reimbursement for<br>primary and in-patient care.|
|17|C1.1I5<br>Enhancement,<br>modernisation and<br>upgrade of Cyprus<br>State Hospitals|Target|Actions to<br>enhance,<br>construct<br>and/or<br>upgrade State<br>hospitals|-|Number|0|4|Q2|2024|At least four actions to enhance, construct<br>and/or upgrade State hospitals shall be<br>implemented.  The Haemodyalisis unit at<br>Paphos Hospital, the new Mental Health<br>Hospital and the new building of Makarios<br>Hospital for children shall have a primary<br>energy demand that is at least 20% lower<br>than defined by the nearly zero-energy<br>building (NZEB) requirement. The end of<br>works shall be attested by taking over<br>issued certificates, of the completed works.|
|18|C1.1I5<br>Enhancement,<br>modernisation and<br>upgrade of Cyprus<br>State Hospitals|Target|Actions to<br>enhance,<br>construct<br>and/or<br>upgrade State<br>hospitals|-|Number|4|7|Q2|2026|Seven actions to enhance, construct and/or<br>upgrade State hospitals shall be<br>implemented. The Haemodyalisis unit at<br>Paphos Hospital, the new Mental Health<br>Hospital and the new building of the<br>Makarios Hospital for children shall have a<br>primary energy demand that is at least 20%<br>lower than defined by the nearly zero-<br>energy building (NZEB) requirement. The<br>end of works shall be attested by taking<br>over issued certificates of the completed<br>works.|

10

**B.** **COMPONENT** **2.1:** **C** **LIMATE NEUTRALITY** **,** **E** **NERGY EFFICIENCY AND** **R** **ENEWABLE** **E** **NERGY**

This component of the Cypriot Recovery and Resilience Plan aims to address the challenge of climate
change mitigation by contributing to the country’s transition to climate neutrality.

The objectives of the component are to improve the environment policy through measures relating to
green taxation, the opening up of the electricity market and the facilitation of licensing of renewable
energy and renovation projects. The component aims to improve the energy efficiency of the building
stock and other infrastructure and to support green investments for SMEs, households, the wider
public sector and NGOs. The component also targets the alleviation of energy poverty and aims to
address Cyprus’ energy isolation.

The component supports addressing the Country Specific Recommendations for the years 2019 and
2020 that recommend focusing investment and investment-related policies on energy efficiency and
renewable energy (Country-Specific Recommendation 4 of 2019 and Country-Specific
Recommendation 3 of 2020).

It is expected that no measure in this component does significant harm to environmental objectives
within the meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of
the measures and the mitigating steps set out in the recovery and resilience plan in accordance with
the DNSH Technical Guidance (2021/C58/01).

**B.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C2.1R1): Green Taxation

The objectives of the measure are to promote a shift towards a more efficient use of environmental
resources, reduce greenhouse gas emissions and to increase the penetration of renewable energy.

The reform shall consist in legislative changes introducing a carbon tax for fuels used in the sectors
of the economy that do not fall under the EU greenhouse gas Emissions Trading System. The reform
shall also entail the gradual introduction of a levy on water, as well as the introduction of a charge on
household/landfill waste. The reform shall aim at making a tangible contribution to reaching the 2030
climate and energy targets to reduce greenhouse gas emissions and increase the share of renewable
energy. The legislative changes shall be based on the findings of an independent study to be
undertaken.

The implementation of the reform shall be completed by 30 June 2026.

Reform 2 (C2.1R2): Independence of Cyprus Transmission System Operator (TSOC) from the
incumbent Electricity Authority of Cyprus

The objective of the measure is to enhance competition in the electricity market by creating conditions
for new investors to participate in the generation, storage, aggregation, demand response and supply
of electricity.

The reform shall consist in ensuring the independence of the Cyprus Transmission System Operator
(TSOC) from the incumbent Electricity Authority of Cyprus (EAC) in terms of governance, financial
and personnel management. The measure shall also facilitate supplier switching, which is expected
to reduce the cost of electricity for domestic and commercial/industrial customers.

The implementation of the reform shall be completed by 31 December 2021.

11

                    Reform 3 (C2.1R3): Digital One Stop Shops to streamline RES projects permitting and to facilitate
Energy Renovation in Buildings

The objective of the measure is to promote the implementation of RES projects by streamlining the
RES projects permitting process. The reform shall also aim at accelerating the energy renovation of
buildings.

The reform shall consist in digitalising the licensing permitting process for RES projects and
establishing a single point of contact for technical and financial support for the purposes of energy
renovation of buildings.

The implementation of the reform shall be completed by 31 December 2022.

Reform 4 (C2.1R4): Energy Storage Regulatory Framework

The objective of the measure is to establish a regulatory framework for promoting the participation
of storage facilities in the electricity market.

The reform shall consist in amending the Transmission and Distribution Rules (TDRs) and the
Trading and Settlement Rules (TSRs) to allow storage facilities to participate in the wholesale
electricity market. This is expected to promote the generation of electricity from renewable energy
systems and to contribute to the efficiency and economic viability of the electricity market as a whole.

The implementation of the reform shall be completed by 31 December 2021.

                                                         Investment 1 (C2.1I1): Promoting energy efficiency investments in SMEs and non profit
organisations

The objective of the measure is to reduce the primary and final energy consumption and the CO2
emissions in buildings and/or facilities owned or operated by SMEs and non-profit organisations.

The investment shall consist in providing support for building renovation and for making production
processes more efficient through the implementation of at least 275 energy efficiency projects. The
grant scheme shall also promote the execution of energy audits, as well as the adoption of digital
technologies and the integration of renewables. The investment shall aim at achieving on average at
least a 30% primary energy demand reduction.

It is expected that this measure does not do significant harm to environmental objectives within the
meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of the
measure and the mitigating steps set out in the recovery and resilience plan in accordance with the
DNSH Technical Guidance (2021/C58/01). In particular, the call for proposals for this measure shall
reflect that the purchasing of biomass boilers shall comply with the provisions of the Directive
2008/50/EC on ambient air quality and cleaner air for Europe, the Renewable Energy Directive
2018/2001/EU and relevant national legislation on air pollutant emissions.

The implementation of the investment shall be completed by 31 December 2025.

12

Investment 2 (C2.1I2): Promoting renewables and individual energy efficiency measures in dwellings
and tackling energy poverty, including in households with vulnerable electricity consumers

The objective of the measure is to encourage the use of renewable energy sources and energy savings
by the large stock of old dwellings, as well as to subsidise the implementation of small-scale energy
renovations in households with vulnerable electricity consumers including energy-poor households
and people with disabilities.

The investment is composed of two sub-measures: (i) a support scheme for promoting renewables
and individual energy efficiency measures in dwellings and (ii) a support scheme for addressing
energy poverty in households with vulnerable electricity consumers, including people with
disabilities.

Sub-measure 1: promoting renewables and energy efficiency measures in dwellings

The investment shall consist in providing grants to at least 16 200 dwellings (including households
of vulnerable electricity consumers) for thermal insulation of roofs and/or for the installation of a
photovoltaic system and/or for the installation or replacement of Solar Water Heating (SWH) Systems
of an existing dwelling.

The investment shall achieve on average at least a 30% primary energy demand reduction.

Sub-measure 2: addressing energy poverty in households with people with disabilities

The investment shall consist in providing technical support in at least 270 households with people
with disabilities with the objective of facilitating their participation in the aid scheme of sub-measure
1 and to effectively implement the supported small-scale energy renovations. The implementation of
the investment shall be completed by 30 June 2026.

Investment 3 (C2.1I3): Encouraging the use of renewables and energy savings by local/wider public
authorities and facilitating the transition of local communities towards climate mitigation &
adaptation

The objective of the measure is to promote the use of RES and energy savings by the large stock of
old infrastructure used by local authorities, as well as to build a pipeline of sustainable energy and
climate adaptation investment projects across rural communities in Cyprus.

The investment is composed of two sub-measures: (i) encouraging the use of renewables and energy
savings by local/wider public authorities; and (ii) facilitating the transition of local communities
towards climate mitigation and adaptation.

Sub-measure 1: Encouraging the use of renewables and energy savings by local/wider public
authorities

The sub-measure shall consist in setting up a grant scheme for providing support for large-scale
energy efficiency and RES measures in buildings, infrastructure, and social housing targeting local
and wider public authorities.

The sub-measure shall lead to a reduction of at least 45% in primary energy consumption per year
(11 250 MWh/y) of local and wider public authorities.

Sub-measure 2: Facilitating the transition of local communities towards climate mitigation
and adaptation

The sub-measure shall consist in providing technical support to Local (Community) Councils in
developing Sustainable Energy and Climate Plans and implementing energy and climate investments,
as well as in setting up a grant scheme to support sustainable climate adaptation investments.

13

The implementation of the investment shall be completed by 30 June 2026.

Investment 4 (C2.1I4): Encourage the reduction of CO2 emissions in businesses

The objective of the measure is to encourage businesses to engage in transformations targeting
decarbonisation, starting with the measurement of their greenhouse gas emissions (GHG) and the
formulation of action plans to reduce (GHG) emissions in their operations and/ or supply chains
(roadmaps to decarbonisation).

The investment consists in setting up a support scheme providing financing for businesses to produce
their decarbonisation roadmap to 2030. The scheme aims to support the businesses to measure, verify
and monitor their GHG emissions resulting from the activities of their undertaking/s, and set up a
GHG emissions reduction action plan containing certain investments/actions towards their
decarbonisation until 2030. In order to ensure that the measure complies with the ‘Do no significant
harm’ Technical Guidance (2021/C58/01), the investments/actions to be included in the supported
action plans shall exclude the following list of activities: (i) activities related to fossil fuels, including
downstream use [1] ; (ii) activities under the EU Emission Trading System (ETS) achieving projected
greenhouse gas emissions that are not lower than the relevant benchmarks [2] ; (iii) activities related to
waste landfills, incinerators [3] and mechanical biological treatment plants [4] ; and (iv) activities where
the long-term disposal of waste may cause harm to the environment. The terms of reference shall
additionally require that only activities that comply with relevant EU and national environmental
legislation may be selected.

The implementation of the investment shall be completed by 31 December 2024.

Investment 5 (C2.1I5): Energy Efficiency Upgrading of public buildings

The objective of the measure is to facilitate the energy upgrading and increased energy efficiency of
selected public buildings, i.e. fire service properties, schools, the Nicosia General Hospital, water
treatment plants and water pumping stations.

The investment is composed of three sub-measures: (i) Fire Service Properties and Schools; (ii)
Nicosia General Hospital; and (iii) Installation of Grid connected Photovoltaic Energy Systems in
Water Treatment Plants and water pumping stations.

1 Except projects under this measure in power and/or heat generation, as well as related transmission and distribution
infrastructure, using natural gas, that are compliant with the conditions set out in Annex III of the ‘Do no significant harm’
Technical Guidance (2021/C58/01).

2 Where the activity supported achieves projected greenhouse gas emissions that are not significantly lower than the
relevant benchmarks an explanation of the reasons why this is not possible shall be provided. Benchmarks established for
free allocation for activities falling within the scope of the Emissions Trading System, as set out in the Commission
Implementing Regulation (EU) 2021/447.
3 This exclusion does not apply to actions under this measure in plants exclusively dedicated to treating non-recyclable
hazardous waste, and to existing plants, where the actions under this measure are for the purpose of increasing energy
efficiency, capturing exhaust gases for storage or use or recovering materials from incineration ashes, provided such
actions under this measure do not result in an increase of the plants’ waste processing capacity or in an extension of the
lifetime of the plants; for which evidence is provided at plant level.
4 This exclusion does not apply to actions under this measure in existing mechanical biological treatment plants, where
the actions under this measure are for the purpose of increasing energy efficiency or retrofitting to recycling operations
of separated waste to compost bio-waste and anaerobic digestion of bio-waste, provided such actions under this measure
do not result in an increase of the plants’ waste processing capacity or in an extension of the lifetime of the plants; for
which evidence is provided at plant level.

14

Sub-measure 1: Fire Service Properties and Schools

The sub-measure consists in the implementation of energy upgrades in 17 urban and rural fire stations
in Cyprus including the Fire Brigade Headquarters. The sub-measure shall also cover the installation
of thermal insulation and photovoltaic systems in at least 405 schools.

The investment shall aim at achieving on average at least a 30% primary energy demand reduction.

Sub-measure 2: Nicosia General Hospital

The sub-measure shall consist in the setting up and installation of photovoltaics system at the Nicosia
General Hospital of a total capacity of 943 KW.

Sub-measure 3: Water Treatment Plants and water pumping stations

The sub-measure shall consist in the installation of grid connected photovoltaic energy systems of
total power of 2 MWp in water treatment plants and water pumping stations.

The implementation of the investment shall be completed by 31 December 2025.

Investment 6 (C2.1I6): Upgrading renewable energy and smart grids testing infrastructure at the
University of Cyprus

The objective of the measure is to upgrade the renewable energy and smart grids testing infrastructure
at the University of Cyprus and to integrate this infrastructure in the future smart grid.

The investment shall consist in delivery, installation, testing, calibration, commissioning and
acceptance of smart grids equipment, followed by final infrastructure integration. The measure shall
also include personnel orientation and training.

The implementation of the investment shall be completed by 31 December 2024.

Investment 7 (C2.1I7): Mass installation and operation by the Distribution System Operator (DSO)
of Smart Metering Infrastructure (Advanced Metering Infrastructure)

The objective of the measure is to facilitate the mass roll-out of smart meters in Cyprus.

The investment shall consist in the delivery of 400 000 smart meters to the EAC and installation of
250 000 of these to final electricity customers, including natural and legal persons.

The implementation of the investment shall be completed by 30 June 2026.

Investment 8 (C2.1I8): Monitoring and reduction of GHG emissions in agriculture

The objective of the measure is to enhance the monitoring for greenhouse gas emissions from
agriculture in Cyprus and contribute to their reduction.

The investment shall consist in the establishment of a GHG monitoring system for agriculture, which
shall provide data for the implementation of more efficient mitigation practices and contribute to
achieving a 10% reduction of GHG emissions from agriculture by end 2025.

The implementation of the investment shall be completed by 31 December 2025.

Investment 9 (C2.1I9): Forests fire protection

15

The objective of the measure is to upgrade the capabilities of relevant authorities in Cyprus to cope
with fire hazards and to strengthen the protection against the risks faced by citizens, infrastructure
and forests.

The investment shall consist in the purchasing of firefighting aircraft, vehicles, equipment and related
training and servicing for the period of implementation of the measure. This shall include the supply
of the following vehicles, machinery and equipment: 75 transport vehicles for patrol purposes for
forest protection and transfer of staff in fire incidents; 12 large fire trucks; 25 emergency firefighting
vehicles; four bulldozers for the construction of fire protection works with the possibility of transport
by truck for rapid transport to fires; four ground bulldozers for the construction of fire protection
works; six agricultural tractors equipped with the necessary tools for the implementation of fire
prevention measures; four-wheel excavators / loaders; six branch shredders; four loaders (trucks) and
six water tank (trucks) for fire protection purposes; one firefighting aircraft.

The implementation of the investment shall be completed by 30 June 2026.

Investment 10 (C2.1I10): Market Management System to facilitate the opening of the electricity
market to competition

The objective of the measure is to introduce a Market Management System by the Cyprus
Transmission System Operator as a tool for facilitating the opening of the electricity market to
competition.

The investment shall consist in the installation and roll-out of the Market Management System for
the Cyprus Electricity Market and related training of 100% of the personnel of the Transmission
System Operator.

The implementation of the investment shall be completed by 31 March 2023.

16

**B.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|19|C2.1R1<br>Green Taxation|Milestone|Entry into<br>force of a law<br>introducing a<br>carbon tax for<br>fuels, a levy<br>on water and a<br>charge on<br>household/<br>landfill waste|Provision in<br>the law<br>indicating the<br>entry into<br>force of a law<br>introducing a<br>carbon tax for<br>fuels, a levy<br>on water and a<br>charge on<br>household/<br>landfill waste|-|-|-|Q1|2024|Entry into force of legislative changes that<br>shall aim at making a tangible contribution to<br>reaching the 2030 target for reducing<br>greenhouse gas emissions. The amendments<br>shall be based on the findings of an<br>independent study to be undertaken. The law<br>shall in particular (a) introduce a carbon tax<br>for fuels used in the sectors of the economy<br>that do not fall under the EU greenhouse gas<br>Emissions Trading System, (b) introduce<br>gradually a levy on water that shall reflect the<br>scarcity of this natural resource and the cost to<br>the environment of its use and (c) introduce of<br>a country wide charge on household/ landfill<br>waste.|
|20|C2.1R1<br>Green Taxation|Milestone|Impact<br>assessment<br>report<br>measuring the<br>reform’s effect<br>on the<br>environment<br>and the<br>economy|Publication of<br>the impact<br>assessment<br>report<br>measuring the<br>reform’s effect<br>on the<br>environment<br>and the<br>economy|-|-|-|Q2|2026|Impact assessment report measuring the<br>reform’s effect onthe environment and the<br>economic effect on households and<br>businesses, as well as recommending further<br>tax amendments, as necessary.|
|21|C2.1R2<br>Independence<br>of Cyprus|Milestone|Law for the<br>Regulation of<br>the Electricity|Provision in<br>the law<br>indicating the|-|-|-|Q4|2021|Entry into force of the Law for the Regulation<br>of the Electricity Market of 2021, which shall<br>facilitate the opening of the electricity market|

17

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||Transmission<br>System<br>Operator<br>(TSOC) from<br>the incumbent<br>Electricity<br>Authority of<br>Cyprus||Market of<br>2021|entry into<br>force of the<br>2021 "Law for<br>the Regulation<br>of the<br>Electricity<br>Market"||||||to competition and boost the uptake of RES<br>by: (a) achieving the independence of the<br>Cyprus Transmission System Operator<br>(TSOC) from the incumbent Electricity<br>Authority of Cyprus (EAC) (autonomy in<br>governance, financial autonomy and<br>independence of TSOC personnel), (b)<br>introducing the necessary steps for reducing<br>the cost of electricity for domestic and<br>commercial/industrial customers and (c)<br>creating conditions of transparency and trust<br>to motivate new investors in generation and<br>supply of electricity.|
|22|C2.1R3<br>Digital One-<br>Stop Shops to<br>streamline RES<br>projects<br>permitting and<br>to facilitate<br>Energy<br>Renovation in<br>Buildings|Milestone|Fully<br>operational IT<br>platform|Fully<br>operational IT<br>platform<br>accepted by<br>the Ministry of<br>Energy,<br>Commerce<br>and Industry|-|-|-|Q4|2022|Fully operational IT platform for (1) guiding<br>the applicant through the administrative<br>permit application process in a transparent<br>manner up to the delivery of one or several<br>decisions by the responsible authorities, (2)<br>providing the applicant with all necessary<br>information and involve, where appropriate,<br>other administrative authorities.|
|23|C2.1R4<br>Energy Storage<br>Regulatory<br>Framework|Milestone|Amendment<br>of the<br>Transmission<br>and<br>Distribution<br>Rules (TDRs)<br>and Trading<br>and Settlement<br>Rules (TSRs)|Publication on<br>the website of<br>the Cyprus<br>Energy<br>Regulatory<br>Authority of<br>Amendment<br>of the<br>Transmission|-|-|-|Q4|2021|Entry into force of an amendment to the<br>Transmission and Distribution Rules (TDRs)<br>and Trading and Settlement Rules (TSRs)<br>which shall provide the necessary regulatory<br>framework (market rules) and technical<br>modalities that shall allow storage facilities to:<br>- participate in the wholesale electricity<br>market,|

18

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||and<br>Distribution<br>Rules (TDRs)<br>and the<br>Trading and<br>Settlement<br>Rules (TSRs)||||||- promote the development of an economically<br>viable, efficient, safe and consumer-oriented<br>electricity market that prioritises the<br>generation of electricity from renewable<br>energy systems.|
|24|C2.1I1<br>Promoting<br>energy<br>efficiency<br>investments in<br>SMEs and non-<br>profit<br>organisations|Milestone|Support<br>scheme for<br>Promoting<br>energy<br>efficiency<br>investments in<br>SMEs,<br>municipalities,<br>communities<br>and the wider<br>public sector|Publication of<br>call for<br>proposals for<br>the support<br>scheme for<br>Promoting<br>energy<br>efficiency<br>investments in<br>SMEs,<br>municipalities,<br>communities<br>and the wider<br>public sector|-|-|-|Q4|2021|Issue call for proposals for the support scheme<br>for promoting energy efficiency investments<br>in SMEs, municipalities, communities and the<br>wider public sector, following verification of<br>state aid regulation to be applied by<br>Commissioner for State Aid Control and<br>Council of Ministers’ decision approving the<br>scheme’s objectives. The investment shall aim<br>at achieving on average at least a 30% primary<br>energy demand reduction.<br>|
|25|C2.1I1<br>Promoting<br>energy<br>efficiency<br>investments in<br>SMEs, and<br>non-profit<br>organisations|Target|Entities<br>(SMEs, non-<br>profit<br>organisations)<br>having<br>implemented<br>energy<br>efficiency<br>interventions||Number|0|125|Q4|2024|At least 125 projects (undertaken by SMEs or<br>non-profit organisations) have been<br>implemented through energy efficiency<br>interventions (energy efficiency measures) in<br>buildings or energy efficiency measures<br>related to their production processes with an<br>objective to achieve on average at least a 30%<br>primary energy demand reduction. The<br>projects selected shall be in compliance with<br>the ‘Do no significant harm’ Technical<br>Guidance (2021/C58/01) through the use of an|

19

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||exclusion list and the requirement of<br>compliance with the relevant EU and national<br>environmental legislation.|
|26|C2.1I1<br>Promoting<br>energy<br>efficiency<br>investments in<br>SMEs,  and<br>non-profit<br>organisations|Target|Entities<br>(SMEs, non-<br>profit<br>organisations)<br>having<br>implemented<br>energy<br>efficiency<br>interventions||Number|125|275|Q4|2025|At least 275 projects (undertaken by SMEs or<br>non-profit organisations) have been<br>implemented through energy efficiency<br>interventions (energy efficiency measures) in<br>buildings or energy efficiency measures<br>related to their production processes with an<br>objective to achieve on average at least a 30%<br>primary energy demand reduction. The<br>projects selected shall be in compliance with<br>the ‘Do no significant harm’ Technical<br>Guidance (2021/C58/01) through the use of an<br>exclusion list and the requirement of<br>compliance with the relevant EU and national<br>environmental legislation.|
|27|C2.1I2<br>Promoting<br>renewables and<br>individual<br>energy<br>efficiency<br>measures in<br>dwellings and<br>tackling energy<br>poverty in<br>households<br>with vulnerable<br>electricity<br>consumers|Milestone|First call for<br>proposals for<br>Promoting<br>renewables<br>and individual<br>energy<br>efficiency<br>measures in<br>dwellings|First call for<br>proposals<br>published|-|-|-|Q2|2021|The first call for proposals for promoting<br>renewables and individual energy efficiency<br>measures in dwellings has been published on<br>the RES and Energy Conservation Fund<br>website. The investment shall aim at achieving<br>on average at least a 30% primary energy<br>demand reduction.|

20

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|28a|C2.1I2<br>Promoting<br>renewables and<br>individual<br>energy<br>efficiency<br>measures in<br>dwellings and<br>tackling energy<br>poverty in<br>households<br>with vulnerable<br>electricity<br>consumers|Target|Dwellings and<br>households<br>with<br>vulnerable<br>electricity<br>consumers<br>(including<br>people with<br>disabilities)<br>having<br>improved their<br>energy<br>performance|-|Number|0|8 500|Q4|2023|At least 8 500 dwellings and 600 households<br>with vulnerable electricity consumers<br>(including people with disabilities) have<br>improved their energy performance due to the<br>financial support provided, as well as tailored<br>solutions (support services and energy<br>guidance) for people with disabilities, with an<br>objective to achieve on average at least a 30%<br>primary energy demand reduction.|
|29a|C2.1I2<br>Promoting<br>renewables and<br>individual<br>energy<br>efficiency<br>measures in<br>dwellings and<br>tackling energy<br>poverty in<br>households<br>with vulnerable<br>electricity<br>consumers|Target|Dwellings and<br>households<br>with<br>vulnerable<br>electricity<br>consumers<br>(including<br>people with<br>disabilities)<br>having<br>improved their<br>energy<br>performance|-|Number|8 500|16 200|Q2|2026|At least 16 200 dwellings and 1 600<br>households with vulnerable electricity<br>consumers (including people with disabilities)<br>have improved their energy performance due<br>to the financial support provided, as well as<br>tailored solutions (support services and energy<br>guidance), with an objective to achieve on<br>average at least a 30% primary energy demand<br>reduction.|
|30|C2.1I3<br>Encouraging<br>the use of<br>renewables and|Milestone|First call for<br>proposals to<br>support local<br>authorities in|Publish first<br>call for<br>proposals|-|-|-|Q3|2021|The first call for proposals to support local<br>authorities in energy efficiency measures has<br>been published on the RES and Energy<br>Conservation Fund Website. The investment|

21

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||energy savings<br>by local/wider<br>public<br>authorities and<br>facilitating the<br>transition of<br>local<br>communities<br>towards<br>climate<br>mitigation &<br>adaptation||energy<br>efficiency<br>measures|||||||shall aim at achieving on average at least a<br>30% primary energy demand reduction.|
|31a|C2.1I3<br>Encouraging<br>the use of<br>renewables and<br>energy savings<br>by local/wider<br>public<br>authorities and<br>facilitating the<br>transition of<br>local<br>communities<br>towards<br>climate<br>mitigation &<br>adaptation|Target|Investments<br>undertaken by<br>local and<br>wider public<br>authorities that<br>have improved<br>their energy<br>performance|-|MWh per<br>year|0|3600|Q4|2024|Investments undertaken by local and wider<br>public authorities have improved their energy<br>performance due to the financial support<br>provided and have achieved a primary energy<br>consumption reduction of at least 3600 MWh<br>per year<br>|
|32a|C2.1I3<br>Encouraging<br>the use of<br>renewables and|Target|Investments<br>undertaken by<br>local<br>authorities that|-|MWh per<br>year|3600|11 250|Q2|2026|Investments undertaken by local and wider<br>public authorities have improved their energy<br>performance due to the financial support<br>provided and have achieved a primary energy|

22

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||energy savings<br>by local/wider<br>public<br>authorities and<br>facilitating the<br>transition of<br>local<br>communities<br>towards<br>climate<br>mitigation &<br>adaptation||have improved<br>their energy<br>performance|||||||consumption reduction of at least 11 250<br>MWh per year.|
|32c|C2.1I3<br>Encouraging<br>the use of<br>renewables and<br>energy savings<br>by local/wider<br>public<br>authorities and<br>facilitating the<br>transition of<br>local<br>communities<br>towards<br>climate<br>mitigation &<br>adaptation|Target|Grant scheme<br>to support<br>sustainable<br>climate<br>adaptation<br>investments in<br>local<br>(Community)<br>Councils|Number|-|0|27|Q2|2026|At least 27 local communities have been<br>supported to implement climate adaptation<br>investments.|
|33|C2.1I4<br>Encourage the<br>reduction of|Target|Undertakings<br>having<br>developed<br>their GHG|-|Number|0|300|Q4|2024|At least 300 undertakings have developed<br>their GHG emissions reduction action plans,<br>due to the support provided. The action plans<br>formulated shall be in compliance with the|

23

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||CO2 emissions<br>in businesses||emissions<br>reduction<br>action plans|||||||’Do no significant harm’ Technical Guidance<br>(2021/C58/01) through the use of an exclusion<br>list and the provision for compliance with the<br>relevant EU and national environmental<br>legislation.|
|35|C2.1I5<br>Energy<br>Efficiency<br>Upgrading of<br>public<br>buildings|Target|Thermal<br>insulation and<br>photovoltaic<br>systems<br>installed in<br>schools|-|Number|0|405|Q1|2022|Thermal insulation and photovoltaic systems<br>installed in at least 405 schools with an<br>objective to achieve on average at least a 30%<br>primary energy demand reduction.|
|36|C2.1I5<br>Energy<br>Efficiency<br>Upgrading of<br>public<br>buildings|Target|Completion of<br>set up and<br>installation of<br>photovoltaics<br>system at the<br>Nicosia<br>General<br>Hospital|-|Number|0|943|Q4|2023|Completion of set up and installation of PV<br>system at the Nicosia General Hospital of total<br>capacity of 943 KW.|
|37|C2.1I5<br>Energy<br>Efficiency<br>Upgrading of<br>public<br>buildings|Target|Completion of<br>installation of<br>photovoltaic<br>systems in<br>water pump<br>stations and<br>fire stations|-|Number|0|2 200|Q4|2025|Completion of installation of photovoltaic<br>systems, of a total capacity of 2 200KW, in<br>water pump stations and fire stations.|
|38|C2.1I6<br>Upgrading<br>renewable<br>energy and<br>smart grids<br>testing|Milestone|Signature of<br>contracts for<br>the installation<br>of equipment<br>to upgrade the<br>electricity grid|Contracts<br>Signature|-|-|-|Q4|2023|Signature of contracts for the installation of<br>equipment to upgrade the electricity grid into<br>a smart grid following a successful public<br>procurement procedure.|

24

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||infrastructure<br>at the<br>University of<br>Cyprus||into a smart<br>grid||||||||
|39|C2.1I6<br>Upgrading<br>renewable<br>energy and<br>smart grids<br>testing<br>infrastructure<br>at the<br>University of<br>Cyprus|Milestone|Delivery,<br>successful<br>installation<br>and<br>acceptance of<br>the equipment<br>for smart grids|Issued<br>acceptance<br>report|-|-|-|Q4|2024|Delivery, successful installation, testing,<br>calibration, commissioning and acceptance of<br>the equipment for smart grids, followed by<br>final infrastructure integration.|
|40|C2.1I7<br>Mass<br>installation and<br>operation by<br>the<br>Distribution<br>System<br>Operator<br>(DSO) of<br>Smart<br>Metering<br>Infrastructure<br>(Advanced<br>Metering<br>Infrastructure)|Milestone|Contract<br>Signature for<br>smart<br>electricity<br>metering<br>infrastructure|Contract<br>Signature|-|-|-|Q1|2024|Contract Signature for smart electricity<br>metering infrastructure (Hardware, software<br>and support & other services).|
|41|C2.1I7<br>Mass<br>installation and|Target|Delivery and<br>installation of<br>smart meters|-|Number|0|50 000<br>delivered<br>to EAC|Q3|2024|Delivery and acceptance of at least 50 000<br>smart electricity meters to EAC and<br>installation of 15 000 of these to final|

25

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||operation by<br>the<br>Distribution<br>System<br>Operator<br>(DSO) of<br>Smart<br>Metering<br>Infrastructure<br>(Advanced<br>Metering<br>Infrastructure)||||||<br>15 000<br>installed to<br>final<br>electricity<br>customers|||electricity customers, including natural and<br>legal persons.|
|42|C2.1I7<br>Mass<br>installation and<br>operation by<br>the<br>Distribution<br>System<br>Operator<br>(DSO) of<br>Smart<br>Metering<br>Infrastructure<br>(Advanced<br>Metering<br>Infrastructure)|Target|Delivery and<br>installation of<br>smart meters|-|Number|50 000<br>delivered<br>to EAC<br> <br>15 000<br>installed to<br>final<br>electricity<br>customers|40 0 000<br>delivered<br>to EAC<br> <br>250 000<br>installed to<br>final<br>electricity<br>customers|Q2|2026|Delivery and acceptance of 400 000 smart<br>electricity meters to EAC and installation of<br>250 000 of these to final electricity customers,<br>including natural and legal persons.|
|43|C2.1I8<br>Monitoring and<br>reduction of<br>GHG|Milestone|Purchase and<br>installation of<br>monitoring<br>units for<br>measuring|Approval of<br>the equipment<br>and<br>installation by|-|-|-|Q2|2023|Purchase and installation of automobile unit<br>and permanent monitoring units, for<br>measuring GHG emissions from agriculture<br>with the objective of implementing adequate<br>policies to mitigate GHG emissions.|

26

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||emissions in<br>agriculture||GHG<br>emissions<br>from<br>agriculture|the receiving<br>committee|||||||
|44|C2.1I8<br>Monitoring and<br>reduction of<br>GHG<br>emissions in<br>agriculture|Target|Reduction of<br>GHG<br>emissions<br>from<br>agriculture|-|% <br>(Percentage)|0|10|Q4|2025|Achieve a 10% reduction of GHG emissions<br>from agriculture through monitoring GHG<br>emissions and calculation of National<br>Emission Factors for GHG emissions and<br>implementation of Emission Factors through<br>the National Inventory for GHG emissions of<br>the country. Reference total emissions from<br>Agriculture soils based on the National<br>Inventory Report of the country is 122,8 kt<br>CO2 equivalent for 2019.|
|45|C2.1I9<br>Forests fire<br>protection|Milestone|Signing of 8<br>Agreements/<br>Contract<br>Signatures for<br>the purchase<br>of vehicles,<br>equipment and<br>provision of<br>services and<br>issue of call<br>for tenders for<br>the purchase<br>of firefighting<br>aircraft|Signing of 8<br>Agreements/<br>Contract<br>Signatures|-|-|-|Q2|2022|Signing of 8 Agreements/ Contracts Signatures<br>with suppliers for the purchase of vehicles,<br>equipment and provision of services and issue<br>of call for tenders for the purchase of<br>firefighting aircraft with the objective of<br>contributing to climate change adaptation and<br>to the reduction of the risk of explosion and<br>expansion of forest fire and the strengthening<br>protection against the risks faced by citizens,<br>infrastructure and forests from a possible fire<br>incident. <br>|
|46|C2.1I9<br>Forests fire<br>protection|Milestone|Delivery of<br>firefighting<br>aircraft,|Acceptance<br>certificates<br>issued for the<br>delivery of|-|-|-|Q4|2025|Delivery and acceptance of firefighting<br>aircraft, vehicles and equipment.|

27

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||vehicles and<br>equipment|firefighting<br>aircraft,<br>vehicles and<br>equipment|||||||
|47|C2.1I9<br>Forests fire<br>protection|Milestone|Completion of<br>services|Acceptance<br>certificates<br>issued to<br>confirm the<br>acceptance of<br>services|-|-|-|Q2|2026|Completion of the following services: (1)<br>firefighting operations and training of pilot<br>type rating, (2) silvicultural practices and (3)<br>services for 3 unmanned aerial vehicle (UAV)<br>– drones.|
|48|C2.1I10<br>Market<br>Management<br>System to<br>facilitate the<br>opening of the<br>electricity<br>market to<br>competition|Milestone|Completion,<br>installation<br>and roll-out of<br>the Market<br>Management<br>System and<br>training of<br>personnel|Issuing of<br>Final<br>Acceptance<br>Certificate for<br>the Market<br>Management<br>System and<br>verification of<br>completion of<br>personnel<br>training|-|-|-|Q1|2023|Completion, installation and roll-out of the<br>Market Management System for the Cyprus<br>Electricity Market and training of the<br>personnel of the Transmission System<br>Operator on the rolled-out information system<br>and related operational procedures.|

28

**B.3.** **Description of the reforms and investments for the loan**

Investment 11 (C2.1I11) Ending energy isolation – Project of Common Interest "EuroAsia
Interconnector"

The objective of the measure is to ensure security of supply and more competitive wholesale
electricity prices, and to enable the increased use of electricity from cleaner sources, in particular
renewables, by connecting the electricity network of Cyprus to the EU continental system.

The investment shall consist in the completion and commissioning of the PCI 3.10.2 Interconnection
between Cyprus and Greece, which shall include a DC 1 000 MW converter station in Cyprus and
related infrastructure in Cyprus and Crete, connected through 898 km of HVDC submarine cables
with 1 000 MW capacity. This is expected to be part of a broader investment building a cross-border
interconnector with a total length of 1 208 km between Crete, Cyprus and Israel. Different parts of
the project are expected to receive funding from different sources, namely the Recovery and
Resilience Facility, the Connecting Europe Facility, a loan from the European Investment Bank,
commercial loans and equity.

It is expected that this measure does not do significant harm to environmental objectives within the
meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of the
measure and the mitigating steps set out in the recovery and resilience plan in accordance with the
DNSH Technical Guidance (2021/C58/01). In particular, the mitigating measures targeting the
conservation of the marine environment shall be duly respected during the implementation of the
project as set out in the Environmental Impact Assessment and the building permit. Any measures
identified in the framework of the EIA and the assessment under Directive 2000/60/EC as necessary
to ensure compliance with the DNSH Technical Guidance (2021/C58/01) shall be integrated into the
project and complied with at the stages of construction, operation and decommissioning of the

infrastructure.

The implementation of the investment shall be completed by 31 December 2025.

29

**B.4.** **Milestones, targets, indicators, and timetable for monitoring and implementation for the loan**

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|49|C2.1I11<br>Ending energy<br>isolation - Project<br>of Common Interest<br>"EuroAsia<br>Interconnector"|Milestone|Start of the<br>construction<br>works of the<br>HVDC<br>Converter<br>Station in<br>Kofinou and the<br>onshore<br>infrastructure in<br>Cyprus|Signed<br>agreement for the<br>construction of<br>Kofinou<br>Converter Station|-|-|-|Q4|2022|Start of the construction works of the<br>HVDC Converter Station in Kofinou and<br>the onshore infrastructure in Cyprus<br>following the securing of relevant funding<br>sources outside of the RRF.|
|50|C2.1I11<br>Ending energy<br>isolation - Project<br>of Common Interest<br>"EuroAsia<br>Interconnector"|Milestone|Completion of<br>construction of<br>converter station|Issuance of the<br>taking over<br>certificate for the<br>construction of<br>converter station|-|-|-|Q4|2024|Completion of construction of converter<br>station including installation of high-<br>voltage and control-equipment|
|51|C2.1I11<br>Ending energy<br>isolation - Project<br>of Common Interest<br>"EuroAsia<br>Interconnector"|Milestone|Completed and<br>fully operational<br>facility of the<br>electricity<br>interconnection<br>between Cyprus-<br>Crete (Greece)|Deliverables<br>acceptance team<br>signs off the<br>operational<br>efficiency of the<br>project;<br>public<br>announcement of<br>the start of<br>operation of the<br>interconnector|-|-|-|Q4|2025|Completed and fully operational facility of<br>the electricity interconnection between<br>Cyprus-Crete (Greece) to: (1) end the<br>energy isolation of Cyprus as an EU<br>member state and (2) ensure the security of<br>energy supply (3) achieve national climate<br>targets as specified in the National Climate<br>Plan|

30

**C.** **COMPONENT** **2.2:** **S** **USTAINABLE** **T** **RANSPORT**

This component of the Cyprus recovery and resilience plan aims at promoting cleaner, smarter, safer
and fairer urban mobility by encouraging a modal shift from private cars to more sustainable modes
of transport such as public transport, cycling, walking, and to promote the use of zero or low-emission
vehicles (LEVs) as well as the use of digital systems in the transport sector.

The component addresses the country-specific recommendations on investment in sustainable
transport (Country-Specific Recommendation 4 of 2019 and Country-Specific Recommendation 3 of
2020).

It is expected that no measure in this component does significant harm to environmental objectives
within the meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of
the measures and the mitigating steps set out in the recovery and resilience plan in accordance with
the DNSH Technical Guidance (2021/C58/01).

**C.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C2.2R1): Establishment of an Intelligent Transport System using Digital Twin
technologies

The objective of the measure is to enhance technological infrastructure, to enable better and more
efficient monitoring of the infrastructure and to introduce smart features to it.

The reform consists in developing and implementing an Intelligent Transport System in order to
improve the mobility management in urban areas and the Cyprus TEN-T network, also by improving
the cooperation between various stakeholders. The reform shall include the delivery, installation and
connection to the National Access Point of 300 sensors. This equipment is expected to constitute the
basis for the digitalisation of the physical mobility networks in a geographical information system
(GIS) database and the integration of mobility services.

The implementation of the reform shall be completed by 31 December 2025.

Reform 2 (C2.2R2): Provide the regulatory framework for an interoperable and effective electric
vehicle (EV) recharging infrastructure and an efficient EV recharging market

The objective of the measure is to facilitate the creation of an efficient electro-mobility infrastructure
for recharging EVs.

The reform consists in the entry into force of legislation on recharging infrastructure for EV. The
reform aims at creating a mechanism for (i) implementation and monitoring of the recharging market
for EV and (ii) coordinating data analysis allowing for the effective network monitoring as well as
for ensuring compliance with national and EU law.

The implementation of the reform shall be completed by 31 December 2024.

Reform 3 (C2.2R3): Progressively phase out the most polluting vehicles, especially in polluted urban

areas

The objective of the reform is to provide the regulatory framework to create impetus for replacing
old and polluting rolling stock, and to provide incentives for using sustainable commuting and
mobility solutions.

31

This reform shall set up the legal framework allowing the implementation of measures aiming at the
exclusion of polluting vehicles from key areas, such as no-emission zones, levies for the circulation
of vehicles in certain areas, and compulsory use of EV in certain transport operations. The reform is
supported by Investment 3 (Promote widespread use of EV, LEVs and alternative means of transport).

The implementation of the reform shall be completed by 31 December 2025.

Investment 1 (C2.2I1): Implementation of Sustainable Urban Mobility Projects (SUMP) and

        accessibility enhancing measures

The objectives of the measures are to create the necessary infrastructure to enhance urban mobility
with more environmentally friendly options, improve the city environment and road safety in
Limassol and Larnaca. The investment shall also include measures to enhance the accessibility and
safe movement of pedestrians, cyclists and persons with disabilities in all urban centres.

More specifically, the investment consists in the introduction of cycle ways, bus lanes and the relevant
ITS equipment (i.e. smart traffic light system with bus priority system), as well as the introduction of
cycle stands, bus shelters and improvement of road safety conditions at selected junctions. It also
includes the creation of Park & Ride stations and the relevant ITS equipment as well as upgrades on
existing road network in the urban centres (such as walkways, crossings for pedestrians, cyclists
and/or people with disabilities, warning systems for the visually impaired, bicycle parking hubs,
walkway ramps).

The implementation of the investment shall be completed by 31 March 2026.

                          Investment 2 (C2.2I2): Creation of electro mobility infrastructure

The objectives of the measures are to create the necessary infrastructure to facilitate the transition to
electro-mobility and to contribute to the deployment of charging points.

The investment is composed of three sub-measures: (i) the installation of publicly accessible EV fast
charging stations; (ii) a grant scheme for the installation of publicly accessible charging points on the
premises of businesses and local authorities; and (iii) a grant scheme for charging EV from Renewable
Energy Sources (RES).

Sub-measure 1: the installation of publicly accessible fast charging stations for EV

The investment consists in the installation of 10 fast charging stations as a demonstration project for
the promotion of electro-mobility. It shall provide access to fast recharging infrastructure for EVs and
therefore it is expected to contribute to removing consumer inhibitions concerning EV autonomy.
The 10 fast charging stations shall be placed in publicly accessible areas such as hospitals, large
publicly accessible parking places or outside public services buildings (such as Ministries or Courts).

Sub-measure 2: a grant scheme for the installation of publicly accessible charging points in
the premises of businesses and local authorities

The scheme shall promote the installation of charging points in publicly accessible areas owned by
businesses or local authorities.

Sub-measure 3: a grant scheme for charging EVs from RES

The scheme shall provide financial incentives to promote the development of the necessary
infrastructure for electro-mobility especially through the charging of EVs from RES. The grant
scheme shall include the installation of photovoltaic systems and charging equipment in dwellings
for the charging of electric private vehicles and the financing of local/public authorities for the
construction of public charging points for EVs. The electricity for the public charging points is
expected to be generated in large part from RES.

32

The implementation of the investment shall be completed by 30 June 2026.

Investment 3 (C2.2I3): Promote widespread use of Electric Vehicles (EVs)

The objective of the measure is to promote the purchase of EVs, LEVs (i.e. a car emitting less than
50 g/km of CO2), electric bicycles and public or non-motorised modes of transport (such as bus,
bicycle), while simultaneously gradually removing older polluting vehicles from circulation. The
investment is expected to complement Reform 3 (Progressively phase out the most polluting vehicles,
especially in polluted areas).

The investment is composed of three sub-measures: (i) kick-start the transition to electro-mobility in
the government sector; (ii) a support scheme for the purchase of EV; and (iii) a scrapping scheme for
the most polluting vehicles combined with incentives for non/low emission mobility options.

Sub-measure 1: kick-start the transition to electro-mobility in the government sector

The investment includes measures aiming to kick-start the gradual replacement of government
conventional vehicle fleet with electric vehicles and promote the transition to electro-mobility. It shall
include the purchase of 100 electric vehicles for the needs of the general government and the
installation of the relevant charging points on government premises.

This is expected to serve as a demonstration project for the promotion of electro-mobility to the wider
public.

Sub-measure 2: a support scheme for the purchase of EVs

The scheme shall provide incentives, by means of grant, for the purchase and registration of EVs and
the purchase of electric bicycles. It is directly linked to Reform 3, “Progressively phase out the most
polluting vehicles, especially in polluted urban areas”, as a parallel, supportive and complementary

measure.

Sub-measure 3: a scrapping scheme for the most polluting vehicles combined with incentives
for non/low emission mobility options

The scheme shall incentivise motorists to give up older and more pollutant vehicles in exchange for
alternative mobility options, such as the purchase of a LEV or of an electric bicycle and/or free annual
bus tickets. The removal of older vehicles is expected to contribute to the reduction of greenhouse
gas (GHG) emission from transport, as well as to the mitigation of its impact on air, water, soil and
noise pollution. The scrapped vehicles shall be recycled, by licensed recyclers. Priority shall be given
to the oldest vehicles to be scrapped.

The implementation of the investment shall be completed by 30 June 2026.

33

**C.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|52|C2.2R1<br>Establishment of<br>an Intelligent<br>Transport<br>System using<br>Digital Twin<br>technologies|Target|Delivery and<br>installation of at<br>least 150 sensors|-|Number|0|150|Q1|2024|Delivery, installation and connection to the<br>National Access Point of at least 150 traffic<br>sensors to digitalise the networks and support the<br>development of an Intelligent Transportation<br>System.|
|53|C2.2R1<br>Establishment of<br>an Intelligent<br>Transport<br>System using<br>Digital Twin<br>technologies|Target|Delivery and<br>installation of a<br>total of 300<br>sensors|-|Number|150|300|Q4|2025|Delivery, installation and connection to the<br>National Access Point of a total of 300 traffic<br>sensors to digitalise the networks and support the<br>development of an Intelligent Transportation<br>System.|
|54|C2.2R2<br>Provide the<br>regulatory<br>framework for<br>an interoperable<br>and effective<br>electric vehicle<br>(EV) recharging<br>infrastructure<br>and an efficient<br>EV recharging<br>market|Milestone|Entry into force<br>of legislation<br>related to electric<br>vehicle charging<br>points|Provision in<br>the law<br>indicating the<br>entry into<br>force of the<br>legislation|-|-|-|Q4|2024|Entry into force of legislation regarding electric<br>vehicle (EV) recharging infrastructure and an<br>efficient EV recharging market.<br>The regulatory framework shall promote: (1) a<br>mechanism for implementation and monitoring of<br>the recharging market of electric vehicles; and (2)<br>a coordinated analysis of data allowing for<br>effective network monitoring as well as for<br>ensuring compliance with national and EU<br>legislation.|
|55|C2.2R3<br>Progressively<br>phase out the<br>most polluting|Milestone|Entry into force<br>of the<br>legislative/admin<br>istrative acts|Provision in<br>the<br>legislative/ad<br>ministrative|-|-|-|Q4|2023|Entry into force of legislative/administrative acts<br>regarding the exclusion of polluting vehicles from<br>key areas/operations.|

34

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||vehicles,<br>especially in<br>polluted urban<br>areas||related to the<br>phasing out of<br>the most<br>polluting<br>vehicles|acts indicating<br>the entry into<br>force of the<br>legislation||||||The legislative/administrative acts shall create the<br>legal basis to enforce the adoption of restrictive<br>measures related to the circulation of motor<br>vehicles, with the aim to progressively phase out<br>the most polluting vehicles.|
|56|C2.2R3<br>Progressively<br>phase out the<br>most polluting<br>vehicles,<br>especially in<br>polluted urban<br>areas|Milestone|Implementation<br>of at least two<br>measures aiming<br>at the exclusion<br>of polluting<br>vehicles|Implementati<br>on of two<br>measures|-|-|-|Q4|2025|At least two measures are effective aiming at the<br>exclusion of polluting vehicles from key<br>areas/operations, such as no-emission zones,<br>applying levies for the circulation of vehicles in<br>certain areas, applying compulsory measures for<br>use of electric vehicles in certain transport<br>operations, or equivalent measures.|
|57|C2.2I1<br>Implementation<br>of Sustainable<br>Urban Mobility<br>Projects (SUMP)<br>and accessibility<br>enhancing<br>measures|Milestone|Contracts<br>signature for the<br>construction<br>work of<br>sustainable<br>transport<br>infrastructure<br>and ancillary<br>installations|Signed<br>contracts|-|-|-|Q2|2024|Signature of contracts for (1) the construction of<br>cycle ways, bus lanes and park & ride stations of<br>the Sustainable Urban Mobility Projects (SUMP)<br>and (2) the provision of ancillary installations<br>related to sustainable transport, including bicycle-<br>parking facilities and crossings for pedestrians,<br>cyclists and/or people with disabilities.|
|58|C2.2I1<br>Implementation<br>of Sustainable<br>Urban Mobility<br>Projects (SUMP)<br>and accessibility<br>enhancing<br>measures|Target|Completion of<br>construction<br>work for at least<br>52km of<br>sustainable<br>transport routes|-|Number|0|52|Q1|2026|Completion of construction work for at least 52km<br>of sustainable transport routes, including at least<br>33km of cycle ways, at least 11km of bus lanes<br>and at least 8km of walkways.|
|59|C2.2I1|Target|Completion of<br>construction|-|Number|0|644|Q1|2026|Completion of construction work for at least 644<br>ancillary installations related to sustainable|

35

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||Implementation<br>of Sustainable<br>Urban Mobility<br>Projects (SUMP)<br>and accessibility<br>enhancing<br>measures||work for at least<br>644 ancillary<br>installations<br>related to<br>sustainable<br>transport|||||||transport, including at least 4 park & ride stations,<br>at least 40 crossings, at least 300 ramps, at least<br>300 bicycle-parking hubs.|
|60|C2.2I2<br>Creation of<br>electro-mobility<br>infrastructure|Target|Installation of at<br>least 330<br>charging points,<br>due to the<br>support granted|-|Number|0|330|Q4|2024|Due to the support granted by the support scheme,<br>at least 330 charging points have been purchased<br>and installed in public buildings, local authorities,<br>businesses and/or private households.|
|61|C2.2I2<br>Creation of<br>electro-mobility<br>infrastructure|Target|Installation of at<br>least 1 200<br>charging points,<br>due to the<br>support granted|-|Number|330|1 200|Q2|2026|Due to the support granted by the support scheme,<br>at least 1 200 charging points have been purchased<br>and installed in public buildings, local authorities,<br>businesses and/or private households.|
|62a|C2.2I3<br>Promote<br>widespread use<br>of Electric<br>Vehicles (EVs)|Target|Purchase of<br>electric vehicles,<br>electric bicycles,<br>due to the<br>support granted|-|Number|0|1523|Q4|2024|Due to the support granted by the support scheme<br>and the public procurement, at least 1523 electric<br>vehicles of categories M1, M2-3, N, L1e-L7e and<br>bicycles have been purchased.|
|63a|C2.2I3<br>Promote<br>widespread use<br>of Electric<br>Vehicles (EVs)|Target|Purchase of<br>electric vehicles,<br>electric bicycles,<br>due to the<br>support granted|-|Number|1523|4335|Q2|2026|Due to the support granted by the support scheme<br>and the public procurement, at least 4335 electric<br>vehicles of categories M1, M2-3, N, L1e-L7e and<br>bicycles have been purchased.|
|64|C2.2I3<br>Promote<br>widespread use<br>of Electric<br>Vehicles (EVs)|Target|Scrapping of<br>high emission<br>vehicles, due to<br>the support<br>granted|-|Number|0|1 000|Q4|2024|Due to the support granted by the support scheme,<br>at least 1 000 high emission vehicles have been<br>scrapped and replaced by electric bicycles, annual<br>bus tickets and no- or low-emission or vehicles<br>(below 50g CO2/km).|

36

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|65|C2.2I3<br>Promote<br>widespread use<br>of Electric<br>Vehicles (EVs)|Target|Scrapping of<br>high emission<br>vehicles, due to<br>the support<br>granted|-|Number|1 000|1 950|Q2|2026|Due to the support granted by the support scheme,<br>at least 1 950 high emission vehicles scrapped and<br>replaced by electric bicycles, annual bus ticket(s)<br>and low emission vehicles (below 50g CO2/km).|

37

**D.** **COMPONENT** **2.3:** **S** **MART AND** **S** **USTAINABLE** **W** **ATER** **M** **ANAGEMENT**

This component of the Cypriot recovery and resilience plan addresses inefficiencies in water
management. The objectives of this component are to ensure adequate and uninterrupted supply of
good quality drinking water, maximising the infrastructure for sewerage collection systems, sewerage
treatment and reuse of treated effluent in agriculture; reducing water loss, non-revenue water and
groundwater abstraction, improving anti-flood infrastructure, improving operational efficiency of the
services being provided to the consumers through technological advances and establishing
transparency in financial transactions.

The component addresses the Country Specific Recommendation on water management (CountrySpecific Recommendation 3 of 2020 and Country-Specific Recommendation 4 of 2019).

It is expected that no measure in this component does significant harm to environmental objectives
within the meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of
the measures and the mitigating steps set out in the recovery and resilience plan in accordance with
the DNSH Technical Guidance (2021/C58/01).

**D.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C2.3R1): Water Resource Management Reform

The objective of the measure is to define actions addressing structural weaknesses in the water
resource management in Cyprus and improving its efficiency and sustainability.

The reform consists of the establishment of a high-level Working Party (the “Working Party”) led by
the Ministry of Agriculture, Rural Development and Environment with participants from the Ministry
of Interior, Ministry of Finance, Directorate General for European Programmes, Coordination and
Development and all Water and Sewerage Boards as well as Local Administration coordinative
bodies to represent all stakeholders in national water management. The Working Party shall serve as
the body for cooperation between the various water management authorities and as a coordination
and monitoring body for the implementation of the investments and actions to be proposed. The
Working Party shall propose an action plan with the necessary regulatory and adaptation measures to
be implemented within the next 10 to 15 years. The objectives of the suggested action plan shall be
(i) to increase operational efficiency through mergers of District Water & Sewerage Boards, (ii) to
reduce non-revenue water, (iii) to improve water use, and (iv) to enhance the safety and sustainable
operation of the infrastructures of the Water Development Department. The Working Party shall
coordinate and monitor the implementation of the action plan and shall provide the necessary
technical assistance to the relevant water management authorities for carrying out the reform
measures as well as the investments included in the component.

The implementation of the reform shall be completed by 30 June 2025.

‑
Investment 1 (C2.3I1): Choirokitia Famagusta Conveyor Replacement

The objectives of the measure are to enhance water supply security through an improved conveyor
infrastructure with increased capacity of the duct between key water sources (such as water treatment
plants) and consumption areas. The investment shall also contribute to minimising water losses and
the occurrence of failures, improving water quality by mixing desalinated and refined water before it
reaches the final consumers, and achieving energy savings through reduced water pumping.

The measure consists of the construction of a replacement of the existing water conveyor. The project
shall include conducting topographical studies and environmental impact assessments. Following the
aforementioned preliminary steps and the issuance of the necessary permits, the Water Development

38

Department shall assign the construction works to a contractor who shall be selected via public
procurement procedures to carry out the works.

The implementation of the investment shall be completed by 30 June 2026.

Investment 2 (C2.3I2): Water Treatment Plants: upgrade for water quality improvement

The objectives of the measure are to improve water quality, reduce energy consumption and the cost
of drinking water production by limiting the need for water desalination, as well as decrease
disruptions to the supply and distribution of water.

The measure consists of refurbishing the Water Treatment Plants of Limassol, Asprokremmos,
Tersefanou, Kornos and Kannaviou. This shall include replacing the existing chlorination
infrastructure for these five Water Treatment Plants, installing activated carbon polishing units for
Limassol, Asprokremmos and Tersefanou Water Treatment Plants, extending the capacity of
Asprokremmos Water Treatment Plant by 10 000 m3/day and upgrading the monitoring and control
system as well as its automation system.

The implementation of the investment shall be completed by 31 December 2025.

Investment 3 (C2.3I3): Integrated Monitoring and Control Management System for the Water
Development Department’s infrastructure

The objective of the measure is to improve the water resource management efficiency and increase
the operational capacity of the competent authorities. The measure aims to reduce the risk of business
disruption by securing the various systems against cyber- and physical attacks, to reduce energy
consumption and GHG emissions by increasing efficiency, to reduce non-revenue water in irrigation
by improving infrastructure and monitoring capacity and to reduce the high-impact risk of
contamination events and the impact of prolonged drought events by closely managing water
resources and forecasting.

The measure consists of creating an integrated platform that shall be composed of a number of
subsystems where each of them shall address key challenges, including water quality, flood
management, water demand management and water allocation for irrigation purposes, energy
efficiency as well as cyber- and physical security. The implementation of the measures shall include:
(i) the installation of 500 hydraulic and quality sensors in all the lakes, reservoirs, rivers, as well as
in the water transport network, up to the level of the communities; (ii) the installation of energy meters
to monitor the energy consumption of pumping stations that shall be transmitted and stored in a
database; (iii) a software platform linked with intelligent analytics and methods to help the decisionmaking process in relation to the production of water from different sources (desalination and
treatment of water from reservoirs) taking into account security of water supply, cost of water
production across different systems and drought forecasts. In addition, the measure shall address
cyber- and physical security challenges through tools for enhancing the protection of ICT systems.
The project shall be implemented by the following sequence of actions: detailed requirement analysis
with the help of specialised consultants; procurement and installation of equipment; and
implementation, assessment and commissioning of the IT sub-systems.

The implementation of the investment shall be completed by 30 June 2026.

Investment 4 (C2.3I4): Smart Water and Sewerage Networks Management

The objective of the measure is to enhance operational and energy efficiency through the
digitalisation of Larnaca Sewerage and Drainage Board, Larnaca Water Board and Water Board of

39

Limassol, notably the upgrading of the organisations’ operation and services and integrating the IT
systems currently used into a unified system to operate under cloud services.

The measure consists of a series of smart and digital upgrades in each of the three organisations: (i)
The Larnaca Sewerage and Drainage Board shall take measures to reduce the energy consumption of
the Larnaca Wastewater Treatment Plant through solar and biogas solutions. (ii) The Larnaca Water
Board shall install water quality and pressure sensors in its distribution networks and is thus expected
to replace at least 50% of its conventional consumer meters with smart meters. Moreover, it shall
develop a Digital Twin decision support tool and a data bank. These systems shall draw information
from the installed sensors, smart water meters and existing systems to be combined to accurately
estimate water flow, pressure and quality of water for the timely detection of events. (iii) The Water
Board of Limassol shall replace conventional consumer meters with automated smart meters and
install pressure and quality sensors for infrastructure monitoring and development of innovative
customer services, such as early warning in the case of a leakage. Furthermore, it is expected to design
a customised software integrating all its operations and to support data-driven decision making.

The implementation of the investment shall be completed by 30 June 2026.

Investment 5 (C2.3I5): Anti-flood and water collection measures

The objective of the measure is to mitigate the negative effects on human health, the environment,
cultural sites and income from flooding events through managing flood risk. A specific objective
resulting from the actions to be implemented is the reduction of erosion from extreme runoffs, both
in agricultural and urban areas.

The measure consists of a series of anti-flood and water collection measures. The works shall
concentrate in three areas, namely Livadia, Kladeri and the centre of Nicosia, as follows: (i) In
Livadia, the Municipality of Larnaca shall upgrade and embellish flood channels, through
improvements to the riverbed and riverbanks. (ii) In Kladeri area, the Municipality of Ypsonas shall
construct a complete rainwater collection network of 4 600 meters in length to cover the area ending
in 35 absorption pits. (iii) In Nicosia, the Municipality of Nicosia has already selected eight areas
where a complete sewer system shall be constructed. The works shall include the reconstruction of
streets and pavements and the expansion of the rainwater network.

The implementation of the investment shall be completed by 31 December 2025.

Investment 6 (C2.3I6): Enhance water security for Nicosia and Larnaca regions

The objective of the measure is to increase the water adequacy for the needs of Nicosia and Larnaca
Water Boards.

The measure foresees the construction of three new generation Glass Lined Steel (GLS) water
reservoirs of 26 000 m [3] in total in Nicosia Region and the construction of a 10 000 m [3] water reservoir
in a specific designated area at Klavdia, Larnaca.

The implementation of the investment shall be completed by 30 June 2025.

Investment 8 (C2.3I8) Protection of the marine ecosystem from hazards through oil spills

The objective of the measure is to protect marine ecosystems through an upgrade of the operational
capacity of the Department of Fisheries and Marine Research to respond promptly, adequately and
effectively to incidents from oil pollution to marine pollution.

40

The measure consists of the purchase of three antipollution vessels with the possibility of autonomous
oil recovery operations, two of which shall operate close to the shoreline and the larger one on the
high seas, as well as the purchase of two autonomous oil dispersant air spraying units.

The implementation of the investment shall be completed by 31 December 2025.

41

**D.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|66|C2.3R1<br>Water<br>Resource<br>Management<br>Reform|Milestone|Adoption of an<br>action plan on<br>water resource<br>management|Publication of<br>the action plan<br>on the website<br>of the Ministry<br>of Agriculture,<br>Rural<br>Development<br>and<br>Environment|-|-|-|Q2|2025|Adoption of an action plan on water<br>resource management with regulatory<br>and adaptation measures. The objectives<br>of the suggested action plan shall be: (1)<br>to assist the merging of District Water &<br>Sewerage Boards, (2)  to reduce Non-<br>Revenue Water  (3) to improve water use<br>and (4)  to enhance the safety and<br>sustainable operation of Water<br>Development Department's<br>infrastructures.|
|67|C2.3I1<br>Choirokitia‑<br>Famagusta<br>Conveyor<br>Replacement|Milestone|Preparation of<br>tender<br>documents and<br>issue call for<br>tenders|Published call<br>for tender for<br>the conveyor<br>replacement<br>works|-|-|-|Q3|2023|Preparation of tender documents and<br>issue of call for tenders following the<br>completion of detailed design of the<br>Choirokitia-Famagusta Conveyor<br>replacement, including bill of quantities<br>by quantity surveyor, topography,<br>permits, other technical and<br>environmental studies and licencing.<br>Completed environmental impact<br>assessment on the Environment from<br>Projects Law (127(I)/2018) / Public<br>Procurement procedures (Law<br>73(I)/2016).|
|68|C2.3I1<br>Choirokitia‑<br>Famagusta<br>Conveyor<br>Replacement|Target|Installation of<br>new pipeline<br>with total length<br>of 20km||Number|0|20|Q2|2026|Completion of the construction and<br>installation of a new pipeline with total<br>length of 20km and operation of the<br>equipment. A qualified engineering<br>bureau shall verify the executed work.|

42

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|69a|C2.3I2<br>Water<br>Treatment<br>Plants:<br>upgrade for<br>water quality<br>improvement|Milestone|Completion of<br>the works for<br>the installation<br>of activated<br>carbon polishing<br>units in<br>Tersefanou,<br>Asprokremmos<br>and Limassol<br>Water<br>Treatment<br>Plants|Issued<br>certificates by<br>the project<br>engineer for<br>each of the three<br>contracts|-|-|-|Q1|2024|Completion of the works for installation<br>of activated carbon polishing units of<br>a) 30 000 m3/day capacity for Tersefanou<br>Water Treatment Plant;<br>b) 30 000 m3/day capacity for<br>Asprokremmos Water Treatment Plant;<br>and<br>c) 20 000 m3/day capacity for Limassol<br>Water Treatment Plant.|
|69b|C2.3I2<br>Water<br>Treatment<br>Plants:<br>upgrade for<br>water quality<br>improvement|Milestone|Completion of<br>the works for<br>the replacement<br>of the<br>chlorination<br>infrastructure<br>for the five<br>WTPs|Completion by<br>the project<br>engineer of the<br>works|-|-|-|Q1|2025|Completion of the works for the<br>replacement of the chlorination<br>infrastructure for the Water Treatment<br>Plants of Limassol, Asprokremmos,<br>Tersefanou, Kornos and Kannaviou.|
|70|C2.3I2<br>Water<br>Treatment<br>Plants:<br>upgrade for<br>water quality<br>improvement|Target|Completion of<br>extension works<br>and automation<br>system at<br>Asprokremmos<br>Water<br>Treatment Plant||Number|0|10 000|Q4|2025|Completion of works resulting in the<br>extension of the capacity of<br>Asprokremmos Water Treatment Plant<br>by 10 000 m3/day, including upgrading<br>the monitoring and control system and<br>also the automation system.|

43

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|71|C2.3I3<br>Integrated<br>Monitoring<br>and Control<br>Management<br>System for the<br>Water<br>Development<br>Department’s<br>infrastructure|Milestone|Completion of<br>the detailed<br>requirements<br>analysis and<br>system design<br>document|Approval of<br>detailed<br>requirements<br>analysis and<br>system design<br>document by the<br>Steering<br>Committee of<br>the Water<br>Development<br>Department|-|-|-|Q2|2022|The requirements analysis and system<br>design document shall describe all the<br>aspects, features and functionalities of<br>the system, including: quality sensors,<br>operational sensors (such as flow, level<br>and pressure), energy meters,<br>communications devices, IT equipment<br>(hardware, software). The detailed<br>requirements analysis and system design<br>shall determine the exact number and<br>type of equipment required for this<br>project.|
|72|C2.3I3<br>Integrated<br>Monitoring<br>and Control<br>Management<br>System for the<br>Water<br>Development<br>Department’s<br>infrastructure|Target|Delivery and<br>installation of at<br>least 50% of the<br>equipment||% <br>Percentage|0|50|Q1|2024|Delivery and installation of at least 50%<br>of the total number of units that are<br>prescribed in the Detailed Requirements<br>analysis and system design (quality<br>sensors, communication devises and<br>quality meters).|
|73|C2.3I3<br>Integrated<br>Monitoring<br>and Control<br>Management<br>System for the<br>Water<br>Development<br>Department’s<br>infrastructure|Milestone|Completion of a<br>fully functional<br>Integrated<br>Monitoring and<br>Control Water<br>Management<br>System|Water<br>Development<br>Department<br>project<br>implementation<br>team and<br>responsible<br>officer approves<br>the operation<br>and|-|-|-|Q2|2026|Completion of the Integrated Monitoring<br>and Control Management System, which<br>shall include verification that the system<br>is capable of detecting, at an early stage,<br>events that require immediate actions<br>from the Water Development<br>Department’s personnel. The system<br>shall be able to respond automatically to<br>certain events and at the same time alert<br>operators and/or the public. The system|

44

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||functionality of<br>the entire<br>system||||||shall be capable of collecting and<br>analysing a large amount of data that<br>may be used for forecasting and to aid in<br>decision making.|
|74a|C2.3I4<br>Smart Water<br>and Sewerage<br>Networks<br>Management|Target|Delivery and<br>installation of<br>photovoltaics at<br>the Larnaca<br>Wastewater<br>Treatment Plant||Number|0|700|Q1|2023|Delivery and installation of photovoltaic<br>equipment at the Larnaca Wastewater<br>Treatment Plant generating power of at<br>least 700KW.|
|74b|C2.3I4<br>Smart Water<br>and Sewerage<br>Networks<br>Management|Target|Delivery and<br>installation of<br>biogas unit at<br>the Larnaca<br>Wastewater<br>Treatment Plant<br>||Number|0|90|Q2|2026|Delivery and  installation of biogas unit<br>at the Larnaca Wastewater Treatment<br>Plant generating power of at least 90KW.<br>|
|75|C2.3I4<br>Smart Water<br>and Sewerage<br>Networks<br>Management|Target|Delivery and<br>installation of at<br>least 200 quality<br>and pressure<br>sensors||Number|0|200|Q4|2024|Delivery and installation of at least 200<br>quality and pressure sensors in the<br>Larnaca and Limassol water networks.|
|76a|C2.3I4<br>Smart Water<br>and Sewerage<br>Networks<br>Management|Target|Installation and<br>operation of at<br>least 100 000<br>smart meters||Number|0|100 000|Q2|2026|At least 100 000 smart meters in<br>operation (delivering consumption<br>readings) and a complete smart water<br>metering system, monitoring system, as<br>well as installed and operational control<br>and support systems in Larnaca and<br>Limassol.|
|76b|C2.3I4<br>Smart Water<br>and Sewerage|Target|Development of<br>Digital Twin<br>decision support||Number|0|2|Q2|2026|The Digital Twin decision support tool<br>and data bank in Larnaca are developed<br>and operational; a customised software|

45

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||Networks<br>Management||tool and data<br>bank in Larnaca<br>and design of a<br>customised<br>software<br>solution in<br>Limassol|||||||solution integrating all its operations and<br>supporting data-driven decision making<br>in Limassol is designed.|
|77a|C2.3I5<br>Anti-flood and<br>water<br>collection<br>measures|Milestone|Completion of<br>construction<br>works of<br>drainage<br>network and<br>reconstruction<br>of streets and<br>pavements in<br>areas of Nicosia|Project<br>management<br>team certifies<br>the completion<br>of the<br>construction|-|-|-|Q4|2022|Completion of construction of drainage<br>network and reconstruction of streets and<br>pavements in Agios Antonios, Old city,<br>Likavitos and Agioi Omologites areas of<br>Nicosia with a total length of approx.<br>6.5km.|
|77b|C2.3I5<br>Anti-flood and<br>water<br>collection<br>measures|Milestone|Completion of<br>construction<br>works of<br>drainage<br>network and<br>reconstruction<br>of streets and<br>pavements in<br>areas of Nicosia|Project<br>management<br>team certifies the<br>completion of the<br>construction|-|-|-|Q4|2025|Completion of construction of drainage<br>network and reconstruction of streets and<br>pavements in remaining four areas of<br>Palouriotissa, Trypiotis Agioi<br>Omologites and in the Nicosia city.|
|78|C2.3I5<br>Anti-flood and<br>water<br>collection<br>measures|Milestone|Completion of<br>construction<br>works for the<br>rainwater<br>collection and<br>recycling||-|-|-|Q2|2024|Completion of construction of the<br>rainwater collection and recycling system<br>covering a total water collection system<br>area of 4,5km in Kladeri area.|

46

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||system in<br>Kladeri area||||||||
|79|C2.3I5<br>Anti-flood and<br>water<br>collection<br>measures|Milestone|Completion of<br>construction<br>works for the<br>flood channel in<br>Livadia|Project<br>management<br>team certifies<br>the completion<br>of the<br>construction||||Q4|2025|Completion of construction works for the<br>flood channel with a total capacity of<br>approx. 30 000m3 in Livadia.|
|80|C2.3I6<br>Enhance water<br>security for<br>Nicosia and<br>Larnaca<br>regions|Target|Completion of<br>construction of<br>two glass lined<br>steel reservoirs||Number|0|16 000|Q2|2024|Completion of construction of two glass<br>lined steel reservoirs of a total capacity<br>of 16 000m3.|
|81|C2.3I6<br>Enhance water<br>security for<br>Nicosia and<br>Larnaca<br>regions|Target|Completion of<br>construction of<br>three glass lined<br>steel reservoirs<br>and 1 concrete<br>water reservoir||Number|16 000|36 000|Q2|2025|Completion of construction of three glass<br>lined steel reservoirs and one concrete<br>water reservoir of a total capacity of 36<br>000m³.|
|84|C2.3I8<br>Protection of<br>the marine<br>ecosystem<br>from hazards<br>through oil<br>spills|Milestone|Delivery,<br>quality<br>inspection to<br>verify their<br>operational<br>effectiveness<br>and acceptance<br>of three vessels<br>and two aerial<br>spraying<br>systems|Expert’s<br>reporting and<br>issuance of<br>quality<br>certificate of the<br>operational<br>effectiveness<br>and acceptance<br>of vessels and<br>aerial spraying<br>systems|-|-|-|Q1|2025|Delivery, quality inspection to verify<br>their operational effectiveness and<br>acceptance of three vessels (one vessel of<br>25m in length approximately to operate<br>within the Cypriot Exclusive Economic<br>Zone and two vessels of 8-11m in length<br>approximately to operate within coastal<br>waters and two aerial spraying systems.|

47

**E.** **COMPONENT** **3.1:** **N** **EW GROWTH MODEL AND DIVERSIFICATION OF THE ECONOMY**

The component addresses the challenges of the Cypriot economy with regards to competitiveness,
productivity and investment, as well as overreliance on certain economic sectors, such as tourism.

The objective of the component is to help the economy to transit to a new economic growth model
(Sustainable Business and Trade Centre of Europe) by addressing sectoral challenges as follows:

Primary Sector: the objective is to develop a competitive agriculture sector primarily through agritech and strong collaboration with business, higher-education institutions and research centres to
excel.

Secondary Sector: the objective is to develop a competitive light manufacturing sector that includes
a focus on areas such as green-tech and agri-tech.

Sustainable Tourism: the objective is to develop a strong agri-tourism and sustainable hospitality
infrastructure and attracting health & wellness tourists through competitive and reputable healthcare.

Circular economy (with emphasis on waste management): the objective is to help move towards a
circular economy by making better use of raw materials, reducing waste, raising awareness for
sustainable development and switching to renewable energy in order to mitigate the climate crisis,
protect social well-being and build a resilient economy. The component contributes to addressing the
country specific recommendation related to “focus investment on the green and digital transition” and

                              “on waste and water management” (Country Specific Recommendation 3 of 2020), “focus
investment-related economic policy on sustainable transport, environment” and “on environment, in
particular waste and water management” (Country-Specific Recommendation 4 of 2019)

It is expected that no measure in this component does significant harm to environmental objectives
within the meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of
the measures and the mitigating steps set out in the recovery and resilience plan in accordance with
the DNSH Technical Guidance (2021/C58/01).

**E.1.** **Description of the reforms and investments for non-repayable financial support**

**Sub-Component 3.1.1 Resilient and competitive primary sector**

Reform 1 (C3.1R1): Move agricultural practices from the 20th century to the 21st century by
investing in a national centre for excellence in agri-tech

The objective of the reform is to address challenges in the primary sector, including low productivity
and lack of technological knowledge, by establishing a centralised operating model through strong
collaboration between the Agricultural Research Institute and public universities.

The reform shall consist in establishing Cyprus’s Agricultural Research Institute as the country’s
centre of excellence in agriculture, animal husbandry and environmental protection and to strengthen
the cooperation between the Agricultural Research Institute and universities to develop new curricula.

The implementation of the reform shall be completed by 30 June 2023.

               Reform 2 (C3.1R2): On line platform for improving the trade and information symmetry in the fresh
produce supply chain

The objectives of the reform are to address long-standing drawbacks of the fresh produce supply
chain, especially regarding traceability, market price distortions and the information asymmetry,
which weakens producers’ position in the market.

48

The reform shall consist of a new law on unfair practices in transactions in the local fresh produce
market. A Platform customised to Cyprus’ market specificities shall be offered to the Producers’
Organisations to kick start their cooperation.

The implementation of the reform shall be completed by 30 June 2026.

Reform 3 (C3.1R3): Genetic improvement of the Cyprus sheep and goat population

The objective of the reform is to enhance the productivity and sustainability of the primary sector
through the promotion of agro-technology, advanced reproduction and genomic improvement of
sheep and goats to optimise the production of dairy products.

The reform shall consist of support to the sheep and goat farmers to upgrade their record keeping on
farm, their production processes, product quality evaluation efforts and participation in the nationally
funded AGRICYGEN project, which shall provide them with advanced knowledge and guidance on
the genetic merit of their animals. This shall allow farmers to make informed decisions on animal
reproduction to improve productivity, primarily in terms of milk production.

The implementation of the reform shall be completed by 30 June 2026.

Investment 2 (C3.1I2): Enhancing the existing isotopic databases of Cypriot local traditional
food/drinks, by developing a Block Chain platform, to ensure their identity

The objective of the measure is to develop a mechanism and a fit for purpose verification
methodology for the authentication of Cypriot products as well as of European food in general, by
using stable isotopic databases, thus utilising research and technology. In particular, the measure shall
develop a verification methodology for at least three areas of authenticity (dairy products, honey and
spirits) that are significantly affected by adulteration and fraud.

The investment shall consist in the establishment of a network of expertise that shall inform regulatory
and production stakeholders about food authenticity issues and problems, existing datasets, available
methodology and secure sharing of data and information. Also, it shall develop fit for purpose
verification methodology for at least three areas of authenticity (dairy products, honey and spirits)
that are significantly affected by adulteration and fraud. Moreover, it shall promote knowledge
transfer of “IsoDataBase” outputs to the food industry, regulatory, enforcement, research and
consumer stakeholders and shall build a configurable web and mobile Enterprise Resource Planning
that may convert any paper-based supply chain to digital.

The implementation of the investment shall be completed by 31 March 2025.

Investment 3 (C3.1I3): Upskill the existing farming community and professionalise future labour
force by investing in human capital

The objective of the measure is the upskilling of the farming community, through knowledge transfer
and the promotion of innovation. In this way, it aims at fostering a more competitive agricultural
sector with higher potential, through capacity building and knowledge transfer.

The investment shall consist in the granting of ten scholarships in the agricultural sector, of EUR 10
000 each, for supporting the development of the future labour force in the sector. It shall also support
transfer of knowledge and innovation within the existing labour force, through the use of the
Agricultural Knowledge and Innovation System with links to academia, bridging the gap between
practical application on the one hand and knowledge, science, experience and research on the other.

The implementation of the investment shall be completed by 31 December 2022.

49

**Sub-Component 3.1.2 Innovative and competitive secondary sector**

Investment 5 (C3.1I5): Creation of a National Commercial Identity and promotion of the traditional
product “halloumi”

The objective of the measure is to establish a brand name for the Cypriot products in order to promote
their export.

The investment shall consist in the development of action plans based on two studies: (a) one on the
creation of a National Commercial Identity “Made in Cyprus” (branding) focusing on the quality and
structural characteristics of Cypriot products and services combined with elements of the tradition
and history of the island, and (b) a study for implementing a strategy for halloumi cheese in order to
increase its distinctiveness as an authentic Cyprus product and designing a promotional and awareness
campaign.

The implementation of the investment shall be completed by 31 March 2022.

Investment 6 (C3.1I6): Scheme for modernisation and digitalisation of enterprises engaged in
manufacturing and trading of agricultural products

The objective of the measure is to strengthen the resilience of the agricultural sector, promote
diversification of economic activity and ultimately accelerate sustainable economic growth. The
measure aims to incentivise investments in new businesses or in the technological advancement of
existing businesses, thus helping them bring to the market improved products, increase productivity
and strengthen their growth prospects, create local jobs and provide the base for sustained growth of
the overall economy.

The investment shall consist in the use of a grant scheme that shall provide aid to existing and newly
established enterprises, especially SMEs, engaged in the processing, marketing and development of
agricultural products covered by Annex I of the Treaty on the Functioning of the European Union,
except wine, wine vinegar and activities related to fisheries and aquaculture. The scheme shall assist
enterprises to finance investments in tangible or intangible assets to modernise and improve their
production facilities, expand and increase their productive capacity, introduce new technologies and
procedures and develop new or higher-quality agricultural products. The funding shall also help
businesses to improve their digital capabilities, thus helping them improve their processes.

The implementation of the investment shall be completed by 31 March 2026.

Investment 7 (C3.1I7): Scheme for the enhancement of the competitiveness and/or the energy
efficiency of large enterprises in Cyprus

The objective of the measure is to help large enterprises with capital expenditures for modernisation
efforts that are expected to enable these enterprises to grow, become more competitive, create
employment and thus contribute to economic development of the country, including energy efficiency
improvements.

The investment shall consist in the grant scheme of up to EUR 7 000 000, to develop and promote
existing and new large enterprises, mainly in the manufacturing sector. The grant scheme shall
provide incentives to the enterprises to maintain their activities and employment, as well as to
undertake energy efficiency investments.

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the eligibility criteria contained in terms of reference for upcoming calls for projects

50

shall exclude the following list of activities [5] : (i) activities related to fossil fuels, including downstream
use; (ii) activities under the EU Emission Trading System (ETS) achieving projected greenhouse gas
emissions that are not lower than the relevant benchmarks; (iii) activities related to waste landfills,
incinerators and mechanical biological treatment plants; and (iv) activities where the long-term
disposal of waste may cause harm to the environment. The terms of reference shall additionally
require that only activities that comply with relevant EU and national environmental legislation may
be selected.

The implementation of the investment shall be completed by 30 June 2026.

**Sub-component 3.1.3 Sustainable, high value-added tourism sector**

Investment 8 (C3.1I8): Enhancing the added value of the tourism sector with emphasis on the
countryside, mountainous and remote areas

The objectives of the investment are to enrich the tourism product, attract new markets, while
reducing seasonality and improving the built environment in the countryside, mountainous and

remote areas.

The investment shall consist of grant support to three categories of businesses: (1) SMEs in the
accommodation industry, such as hotels, in the countryside, mountainous and remote areas for
renovation projects, (2) restaurants / taverns or businesses selling traditional food products, which
may be included in the label “Taste of Cyprus”, for renovation works, and (3) SMEs in the
accommodation industry, such as hotels, to include medical and assisted living facilities.

The implementation of the investment shall be completed by 30 June 2026.

Investment 9 (C3.1I9): Promotion of circular economy in hotel establishments

The objectives of the investment are to facilitate the transition of hotels’ business model to circular,
or to develop circular products or services.

The investment consists of diagnostics, recommendations, training and coaching, and monitoring of
the implementation of recommendations leading to certification.

The implementation of the investment shall be completed by 31 March 2026.

Investment 10 (C3.1I10): Enrichment of the tourism product in rural, mountainous and remote areas

The objective of the investment is to support the economy in rural, mountainous and remote areas,
by developing the offer of activities to visitors, such as workshops, live demonstrations and traditional
souvenirs. It aims at enhancing the diversification of the tourism sector, creating jobs, reducing outmigration.

The investment consists of (i) the completion of the 2km long Aphrodite Route, which shall connect
historical, religious and environmental points of the area (such as nature trails) and complements the
creation of the “Authentic Experience Route” project, and (ii) grant support to enterprises and local
community boards for limited-scale restoration of private and public buildings and mostly
repurposing them in order to host micro and small businesses in the creative and manufacturing
sectors, such as artists, handcrafts and traditional products.

The implementation of the investment shall be completed by 31 December 2025.

**Sub-component 3.1.4 Circular economy**

5 All footnotes set out in the text on measure C2.1I4 are also applicable to this measure.

51

Reform 4 (C3.1R4): Enhancement of circular economy in the Industry

The objective of the measure is to enhance the circular economy model in the country through the
implementation of a concrete Action Plan. The Action Plan shall include a grant scheme to enhance
business investment in the circular economy, as well as actions such as (i) raising awareness among
the consumers and the business community regarding the benefits of circular products towards the
environment and about the strengths and business opportunities that the circular economy offers, (ii)
providing consulting services regarding business diagnostics, business coaching, training of
employees and preparation of a roadmap for transitioning to circularity, and (iii) sharing a
marketplace platform for the circular economy to connect supply and demand of materials, scrub and

waste.

The grant scheme shall be open to SMEs aiming to move into a circular operating model. Grants may
go up to EUR 317 500 for each beneficiary, covering up to 60% of the investment cost incurred by
each SME.

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the eligibility criteria contained in terms of reference for upcoming calls for projects
shall exclude the following list of activities [6] : (i) activities related to fossil fuels, including downstream
use; (ii) activities under the EU Emission Trading System (ETS) achieving projected greenhouse gas
emissions that are not lower than the relevant benchmarks; (iii) activities related to waste landfills,
incinerators and mechanical biological treatment plants; and (iv) activities where the long-term
disposal of waste may cause harm to the environment. The terms of reference shall additionally
require that only activities that comply with relevant EU and national environmental legislation may
be selected.

The implementation of the reform shall be completed by 30 June 2026.

Reform 5 (C3.1R5): Establishment of a Coordinating Body between central and local government

The objective of the measure is to upscale waste management towards prevention of waste and
separate collection, thus contributing to compliance with the EU waste management directives as well
as promoting the circular economy. The reform shall provide a mechanism to support local authorities
both technically and financially, help them to liaise with the central government, create expertise and
exploit funding opportunities in the field of waste management.

The reform consists in the establishment of a Coordinating Body between central and local
government that shall promote activities within the waste management hierarchy and the waste
management plan and support local authorities in this perspective. It shall also participate in research
programmes, support pilot programmes and conduct education and information campaigns that aim
at waste prevention and separation of waste, as well as maintain the database of programmes and
projects in the field of waste management.

The implementation of the reform shall be completed by 30 June 2025.

Investment 12 (C3.1I12): Waste management towards circular economy

The objective of the measure is to contribute effectively to upscaling efforts towards recycling of dry
recyclables. The investment aims to assist the achievement of recycling targets, increase waste
prevention as the most important way to improve resource efficiency and reduce the environmental
impact of waste.

The investment consists of the development, set-up, installation and operation of 50 green kiosks for
dry recyclables to help municipalities in remote areas to improve their waste management schemes.

The implementation of the investment shall be completed by 31 December 2025.

6 All footnotes set out in the text on measure C2.1I4 are also applicable to this measure.

52

**E.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|85|C3.1R1<br>Move agricultural<br>practices from the<br>20th century to the<br>21st century by<br>investing in a<br>national centre for<br>excellence in agri-<br>tech|Milestone|Cooperation<br>between the<br>Agricultural<br>Research Institute<br>and public<br>universities, for<br>joint MSc and PhD<br>programmes|Entry into force of<br>signed<br>cooperation<br>agreement(s)|-|-|-|Q4|2022|Entry into force of legally binding<br>document(s) establishing the collaboration<br>for joint MSc and PhD programmes signed<br>between the Agricultural Research<br>Institute and public universities.|
|86|C3.1R1<br>Move agricultural<br>practices from the<br>20th century to the<br>21st century by<br>investing in a<br>national centre for<br>excellence in agri-<br>tech|Milestone|New joint Masters<br>and/or PhDs in the<br>wider domain of<br>Agriculture|Media<br>announcement<br>and<br>communication<br>by competent<br>authorities|-|-|-|Q2|2023|Enrolment of students and start of new<br>joint Masters and/or PhDs in the wider<br>domain of Agriculture.|
|87|C3.1R2<br>On-line platform for<br>improving the trade<br>and information<br>symmetry in the fresh<br>produce supply chain|Milestone|Law on unfair<br>practices in<br>transactions in the<br>local fresh produce<br>market|Provision in the<br>law indicating the<br>entry into force of<br>the new law on<br>unfair practices in<br>transactions in the<br>local fresh<br>produce market|-|-|-|Q2|2022|Entry into force of a new law which shall<br>address unfair trading practices in<br>transactions in the local fresh produce<br>market, such as unilateral and retroactive<br>amendments to contracts, last minute<br>cancellations, payment deadlines longer<br>than 30 days, payment for damaged or<br>unsold products and other actions affecting<br>those involved in the production and<br>distribution chain of agricultural products.|
|88|C3.1R2|Milestone|Platform for<br>recording|Platform available<br>to Producers’|-|-|-|Q2|2026|Fully operational Platform for recording<br>transactions in the local fresh produce|

53

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||On-line platform for<br>improving the trade<br>and information<br>symmetry in the fresh<br>produce supply chain||transactions in the<br>local fresh produce<br>market|Organisations and<br>communication of<br>its availability by<br>competent<br>authorities||||||market shall be available to Producers’<br>Organisations.|
|89|C3.1R3<br>Genetic improvement<br>of the Cyprus sheep<br>and goat population|Target|Upgrade of record<br>keeping in farms<br>and participation<br>of farmers in<br>AGRICYGEN<br>project|-|Number|0|30|Q4|2023|At least 30 farmers have upgraded their<br>record keeping on farm, their production<br>processes, product quality evaluation<br>efforts and participate in the nationally<br>funded AGRICYGEN project.|
|90|C3.1R3<br>Genetic improvement<br>of the Cyprus sheep<br>and goat population|Target|Adoption of<br>advanced<br>recording and<br>genomic<br>evaluation<br>processes, and<br>selection of the<br>best performing<br>animals|-|Number|0|20 000|Q2|2026|Farmers have adopted advanced recording<br>and genomic evaluation processes, and<br>selected the best performing animals based<br>on genomic analysis outputs for at least<br>20 000 animals.|
|93|C3.1I2<br>Enhancement of<br>isotopic database of<br>traditional Cypriot<br>products|Milestone|Liquid<br>Chromatography-<br>Isotopic Ratio<br>Mass Spectrometer<br>(LC-IRMS)<br>equipment|Signed statement<br>of the acceptance<br>of equipment to<br>the standard<br>quality and time<br>specified in the<br>tender documents<br>and the signed<br>contract|-|-|-|Q4|2021|Purchase and Install New Liquid<br>Chromatography- Isotopic Ratio Mass<br>Spectrometer (LC-IRMS) equipment for<br>isotopic characterisation.|

54

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|94|C3.1I2<br>Enhancement of<br>isotopic database of<br>traditional Cypriot<br>products|Target|Local traditional<br>foods/ drinks<br>connected to the<br>system|-|Number|0|10|Q1|2025|Integrated Isotopic DataBases (for at least<br>ten traditional/local foods/ drinks)<br>connected to a Blockchain system.|
|95|C3.1I3<br>Upskill existing and<br>future farmers|Target|Scholarships<br>granted|-|Number|0|5|Q4|2022|At least five scholarships granted to<br>secondary school graduates to study<br>degree courses related to agriculture, in<br>cooperation with the Department of<br>Agriculture, the Agricultural Research<br>Institute and local universities.|
|97|C3.1I5<br>Creation of a<br>National Commercial<br>Identity and<br>promotion of the<br>traditional product<br>“halloumi”|Milestone|Action Plans for<br>(a) the “made in<br>Cyprus” branding,<br>and (b) for the<br>promotion of the<br>halloumi cheese|Publication of the<br>Council of<br>Ministers’<br>decision and of<br>the action plan|-|-|-|Q1|2022|Adoption by the Council of Ministers of<br>Action Plans that shall consist of:<br>(1) assisting businesses to promote their<br>products and services on the basis of the<br>“made in Cyprus” branding, and <br>(2) increasing the distinctiveness of the<br>halloumi cheese as an authentic Cyprus<br>product and designing a promotional and<br>awareness campaign for it.|
|98|C3.1I6<br>Scheme for<br>modernisation and<br>digitalisation of<br>enterprises engaged<br>in manufacturing and<br>trading of agricultural<br>products|Target|Grants to SMEs<br>engaged with trade<br>and production of<br>agricultural<br>products|-|Number|0|65|Q4|2024|Award of grants to at least 65 Small and<br>Medium Enterprises engaged in<br>manufacturing and trading of agricultural<br>products for their modernisation and<br>digitalisation|
|99|C3.1I6<br>Scheme for<br>modernisation and<br>digitalisation of|Target|Grants to SMEs<br>engaged with trade<br>and production of|-|Number|65|176|Q1|2026|Award of grants to at least 176 SMEs<br>engaged in manufacturing and trading of<br>agricultural products for their<br>modernisation and digitalisation|

55

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||enterprises engaged<br>in manufacturing and<br>trading of agricultural<br>products||agricultural<br>products||||||||
|100|C3.1I7<br>Scheme for the<br>enhancement of the<br>competitiveness<br>and/or the energy<br>efficiency of large<br>enterprises in Cyprus|Milestone|Start of the grant<br>scheme on large<br>enterprises|Publication of the<br>call for proposals<br>on the Ministry<br>website|-|-|-|Q3|2023|Following scheme approval by the Council<br>of Ministers, issuance of call for proposals<br>for the award of grants to large enterprises<br>to expand existing business through<br>investments that enhance the technological<br>level, the production process and their<br>productivity, as well as to undertake<br>investments that improve their energy<br>performance. The terms of reference<br>including eligibility criteria that ensure that<br>the selected projects comply with the ‘Do<br>no significant harm’ Technical Guidance<br>(2021/C58/01) through the use of an<br>exclusion list and the requirement of<br>compliance with the relevant EU and<br>national environmental legislation.|
|101a|C3.1I7<br>Scheme for the<br>enhancement of the<br>competitiveness<br>and/or the energy<br>efficiency of large<br>enterprises in Cyprus|Target|Grants to large<br>enterprises|-|Number|0|3|Q4|2024|Award of grants to at least three large<br>enterprises, mainly in the Manufacturing<br>Sector, to expand existing business<br>through investments that enhance the<br>technological level, the production process<br>and their productivity, and to improve<br>their energy performance. <br>All the projects selected shall be in<br>compliance with the ‘Do nosignificant<br>harm’ Technical Guidance (2021/C58/01)<br>through the use of an exclusion list and the<br>requirement of compliance with the|

56

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||relevant EU and national environmental<br>legislation.|
|102a|C3.1I7<br>Scheme for the<br>enhancement of the<br>competitiveness<br>and/or the energy<br>efficiency of large<br>enterprises in Cyprus|Target|Grants to large<br>enterprises|-|Number|3|10|Q2|2026|Award of grants to at least 10 large<br>enterprises, mainly in the Manufacturing<br>Sector, to expand existing business<br>through investments that enhance the<br>technological level, the production process<br>and their productivity, and to improve<br>their energy performance. <br>All the projects selected shall be in<br>compliance with the ‘Do no significant<br>harm’Technical Guidance (2021/C58/01)<br>through the use of an exclusion list and the<br>requirement of compliance with the<br>relevant EU and national environmental<br>legislation.|
|103|C3.1I8<br>Enhancing the added<br>value of the tourism<br>sector with emphasis<br>on the country side,<br>mountainous and<br>remote areas|Target|Grant to SMEs to<br>promote the<br>tourism sector|-|Number|0|200|Q2|2024|Grants awarded to at least 200 SMEs,<br>comprising food establishments,<br>restaurants / taverns, micro, small and<br>medium enterprises selling traditional<br>products, for investing in renovation or<br>refurbishing.|
|104a|C3.1I8<br>Enhancing the added<br>value of the tourism<br>sector with emphasis<br>on the country side,<br>mountainous and<br>remote areas|Target|Grant to hotels to<br>promote the<br>tourism sector|-|Number|0|57|Q2|2026|Grants awarded to at least 57 hotels and<br>other tourism establishments, in<br>countryside, mountainous and remote<br>areas, for investing in renovation or<br>refurbishing, including digital investments.|

57

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|104b|C3.1I8<br>Enhancing the added<br>value of the tourism<br>sector with emphasis<br>on the country side,<br>mountainous and<br>remote areas<br>|Target|Grants to promote<br>medical tourism<br>|-|Number|0|20|Q2|2026|Grants awarded to at least 20 hotels and<br>other tourism establishments, to include<br>medical and assisted living facilities.|
|105|C3.1I9<br>Promotion of circular<br>economy in hotel<br>establishments|Target|Coaching scheme<br>for circular<br>economy|-|Number|0|50|Q2|2022|Signed collaboration agreements with at<br>least 50 hotels have been signed for<br>tailored business coaching for circular<br>economy.|
|106|C3.1I9<br>Promotion of circular<br>economy in hotel<br>establishments|Target|Coaching scheme<br>for circular<br>economy|-|Number|0|18|Q1|2026|At least 18 hotels have been certified<br>according to national standards as circular<br>hotels following audit.|
|107|C3.1I10<br>Enrichment of the<br>tourism product in<br>rural, mountainous<br>and remote areas|Milestone|Aphrodite Route|Signed statement<br>of the acceptance<br>of the project by<br>project team<br>(contracting<br>authority)|-|-|-|Q4|2024|Completion of the Aphrodite Route, which<br>shall connect historical, religious and<br>environmental points of the area (such as<br>nature trails) with a special 2km long<br>route, enhancing environmental awareness<br>and promoting biodiversity.|
|108|C3.1I10<br>Enrichment of the<br>tourism product in<br>rural, mountainous<br>and remote areas|Target|Grants to<br>enterprises and<br>local community<br>boards to promote<br>micro and small<br>businesses in the<br>creative and<br>manufacturing<br>sectors, such as<br>artists, handcrafts|-|Number|0|150|Q4|2025|At least 150 enterprises and local<br>community boards have renovated,<br>refurbished or visually upgraded private<br>and public buildings / infrastructures in<br>countryside, mountainous and remote<br>areas and repurposed them to host micro<br>and small businesses in the creative and<br>manufacturing sectors, such as artists,<br>handcrafts and traditional products.|

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|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||and traditional<br>products||||||||
|109|C3.1R4<br>Enhancement of<br>circular economy in<br>the Industry|Milestone|Approval of the<br>National Action<br>Plan for the<br>Enhancement of<br>Circular Economy<br>in Cyprus|Publication of the<br>Council of<br>Ministers’<br>decision for the<br>approval of the<br>National Action<br>plan.|-|-|-|Q4|2021|Approval, by the Council of Ministers, of<br>the National Action Plan for the<br>Enhancement of Circular Economy in<br>Cyprus|
|110|C3.1R4<br>Enhancement of<br>circular economy in<br>the Industry|Target|Aid for SMEs<br>which are moving<br>into a circular<br>operating model|-|Number|0|40|Q2|2026|Aid granted to at least 40 eligible SMEs,<br>in compliance with the ’Do no significant<br>harm’ Technical Guidance (2021/C58/01)<br>through the use of an exclusion list and the<br>requirement of compliance with the<br>relevant EU and national environmental<br>legislation.|
|111|C3.1R5<br>Establishment of a<br>Coordinating Body<br>between central and<br>local government|Milestone|Legislation on<br>coordination<br>between Central<br>and Local<br>Government|Provision in the<br>law indicating the<br>entry into force of<br>the legislation|-|-|-|Q2|2025|Entry into force of Legislation, which shall<br>establish a Coordinating Body between<br>Central and Local Government. The<br>Coordinating Body shall provide a<br>mechanism to upscale waste management,<br>contribute to compliance with EU waste<br>management directives and promote<br>circular economy.|
|112|C3.1I12<br>Waste management<br>towards circular<br>economy|Milestone|Signature of the<br>contract for the<br>installation of<br>Green kiosks|Signature of the<br>contract|-|-|-|Q3|2023|Signed contract for the set up and<br>installation of at least 50 Green kiosks for<br>dry recyclables.|
|115|C3.1I12<br>Waste management<br>towards circular<br>economy|Target|Completion of<br>installation and<br>start of operation<br>of the green kiosks|-|Number|0|50|Q4|2025|Completion of set up, installation and start<br>of operation of the green kiosks for dry<br>recyclables.|

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**E.3.** **Description of the reforms and investments for the loan**

Investment 1 ( C3.1I1): Construction of a collaborative marine aquaculture infrastructure (port and
land facilities) in the Pentakomo coastal area

The objective of the measure is to cover the gap of not having sufficient port and land infrastructure
for the daily needs of this activity, by covering existing as well as future needs of more than 70% of
the marine aquaculture units operating in Cyprus, aiming at the smooth operation of this sector. The
measure aims at maintaining the aquaculture’s viability, improve its competitiveness and provide for
its future further sustainable development and expansion, strengthening the resilience,
competitiveness and contribution of the primary sector to sustainable development of the Cypriot

economy.

The investment shall consist in the construction of a collaborative infrastructure for marine
aquaculture in the Pentakomo area, which shall be specifically designed to accommodate the needs
of marine offshore aquaculture activities (safe service vessels docking, maintenance areas of
equipment, storage areas, loading and unloading areas and fuelling station). It shall cover the
construction of a small port with the required and appropriate land facilities that shall have the
capacity to serve at least 70% of the marine aquaculture units operating in Cyprus.

The implementation of the investment shall be completed by 31 March 2026.

Investment 11 (C3.1I11): Improvement and extension of the Cyprus Green Points Network and
creation of a network of Collection Points and Recycling Corners

The objectives of the measure are the improvement of the management of solid waste, the protection
of the environment and public health. It aims at mitigating uncontrolled and illegal dumping of waste
in public areas, increasing the rate of recovery and recycling materials, and raising users’ awareness
of sustainable development and circular economy.

The investment foresees the construction of fourteen Green Points covering an area of at least 50 500
m² to serve citizens and local authorities to deposit specific household and municipal waste streams.
In addition to the creation of new Green Points, the investments foresees the construction of
Recycling Corners Network and Collection Points Network to give access to citizens of rural
communities to dispose of their waste.

The implementation of the investment shall be completed by 30 June 2026.

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**E.4.** **Milestones, targets, indicators, and timetable for monitoring and implementation for the loan**

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|91|C3.1I1<br>Marine aquaculture<br>construction|Milestone|Construction of<br>the<br>collaborative<br>marine<br>aquaculture|Contract<br>signature|-|-|-|Q1|2023|Signing the contract for the construction of a<br>collaborative marine aquaculture infrastructure<br>(port and land facilities) that shall specifically be<br>designed for aquaculture activity.|
|92|C3.1I1<br>Marine aquaculture<br>construction|Milestone|Operational<br>collaborative<br>marine<br>aquaculture<br>Infrastructure|Certificate<br>confirming the<br>delivery and<br>operation of the<br>infrastructure<br>developed|-|-|-|Q1|2026|Delivery of a fully functional / operational<br>collaborative marine aquaculture infrastructure<br>(port and land facilities) that shall specifically be<br>designed for aquaculture activity and shall cover<br>the needs of at least 70% of the marine<br>aquaculture units operating in Cyprus.|
|116a|C3.1I11Improvement<br>and extension of the<br>Cyprus Green Points<br>Network and creation<br>of a network of<br>Collection Points and<br>Recycling Corners|Target|Completion of<br>construction,<br>expansion and<br>start of<br>operation of<br>four Green<br>Points|-|Number|0|4|Q3|2024|Completion of construction, expansion and start of<br>operation of four Green Points in accordance with<br>the National Strategic Plan for the Development<br>of a National Green Point Network .|
|116b|C3.1I11Improvement<br>and extension of the<br>Cyprus Green Points<br>Network and creation<br>of a network of<br>Collection Points and<br>Recycling Corners|Milestone|Completion of<br>construction<br>and start of<br>operation of a<br>network of<br>Collection<br>Points and<br>Recycling<br>Corners||-|-|-|Q2|2026|Completion of construction and start of operation<br>of a network of Collection Points and Recycling<br>Corners in accordance with the National Strategic<br>Plan for the Development of a National Green<br>Point Network and the National Strategic Plan for<br>the Development of Mountain Communities,<br>respectively|
|117|C3.1I11Improvement<br>and extension of the<br>Cyprus Green Points|Target|Completion of<br>construction,<br>expansion and|-|Number|4|14|Q2|2026|Completion of construction, expansion and start of<br>operation of fourteen Green Points in accordance|

61

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||Network and creation<br>of a network of<br>Collection Points and<br>Recycling Corners||operation of 14<br>Green Points|||||||with the National Strategic Plan for the<br>Development of a National Green Point Network|

62

**F.** **COMPONENT** **3.2:** **E** **NHANCED** **R** **ESEARCH AND** **I** **NNOVATION**

The component of the Cypriot recovery and resilience plan addresses the challenges that Cyprus faces
as regards the Research and Development ecosystem that plays a relatively limited role in economic
growth. This is mainly due to a low share of Science, Technology, Engineering and Math (STEM)
graduates, limited interaction of the public research system with the business sector and limited access
and availability of risk funding.

The objectives of the component are to strengthen links between research organisations and
enterprises, commercialise research results, increase intensity in research & development (R&D)
activity and investments by both public and private organisations, as well as to make all publicly
funded research infrastructure accessible to the entire ecosystem. Furthermore, it aims to enhance
financial support to start-ups, scale-ups, SMEs, internationalise the local research and innovation
(R&I) ecosystem, develop local talent and attract talent from abroad to work in R&I with emphasis
on specific thematic areas.

The component addresses the Country-Specific Recommendations on increasing the focus on
investment-related economic policy on research and innovation (Country-Specific Recommendations
3 of 2020 and 4 of 2019).

It is expected that no measure in this component does significant harm to environmental objectives
within the meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of
the measures and the mitigating steps set out in the recovery and resilience plan in accordance with
the DNSH Technical Guidance (2021/C58/01).

**F.1.** **Description of the reforms and investments for non-repayable financial support**

                                                            Reform 1 (C3.2R1): Comprehensive national Research and Innovation Policy supported by data
driven policy tools to support the R&I Ecosystem and to enhance links between policy making and
implementation

The objective of the measure is to promote the efficient coordination of the R&I governance system,
to foster awareness raising and nurture innovation culture, to mobilise stakeholders and to develop
and augment the fundamental building blocks of the national R&I ecosystem (of three levels: policy
making, strategy and implementation, stakeholders and users/citizens).

The reform shall consist in the implementation of the Action Plan for the National Strategy for
Research and Innovation. This shall follow the political endorsement of the Action Plan, together
with the adoption of a National Strategy for R&I and the revised Smart Specialisation Strategy for
Cyprus. It shall also consist in establishment of a mechanism for impact driven monitoring and
support of the seven Centres of Excellence and in the development of a digital tool for the dynamic
mapping of the R&I ecosystem (stakeholders, policy measures and tools, R&I performance, registry
of innovative companies and sector analytics).

The implementation of the reform shall be completed by 31 August 2026.

Reform 2 (C3.2R2): Incentives to encourage and attract investments and human capital in Research
and Innovation

The objective of the measure is to attract investment in innovative companies and entrepreneurial and
scientific talents from abroad.

The reform shall consist in the extension of the application of the tax scheme for investing in
innovative companies to legal entities (from physical persons currently). Eligible investments of up
to EUR 150 000 per investor, under this incentive, include equity, loans, guarantees and factoring. In
addition, it shall consist in the review, promotion and, where appropriate, amendment of current
incentive schemes aimed at attracting talents from third countries, including the Scientific VISA

63

scheme for researchers and their families and the Start-up VISA scheme for founders of innovative
enterprises and their families.

The implementation of the reform shall be completed by 30 September 2022.

Reform 3 (C3.2R3): Introduce policies and incentives to facilitate and foster access to publicly funded
research infrastructure and laboratories

The objective of the measure is to optimise utilisation of publicly funded research infrastructure and
laboratories by the business community.

The reform shall consist in (i) the development and launch of a dynamic digital tool accessible to all
stakeholders of the R&I ecosystem, providing information circulation, tools and services for the
facilitation of a collaborative partnership arrangement between different R&I organisations and teams
(public and private) in respect to publicly funded research infrastructures and laboratories; (ii)
introduction of measures and incentives (such as including in Research and Innovation Foundation
grant agreement a clause for opening up funded infrastructure) in order to enhance the collaboration
of Research Performing Organisations with business and spin-offs.

The implementation of the reform shall be completed by 31 December 2024.

Investment 1 (C3.2I1): Set up and operate a central knowledge transfer office

The objective of the measure is to improve technology transfer in Cyprus, through improved
academia-business collaboration and commercialisation of research.

The investment shall consist in the creation and putting in operation of a Knowledge Transfer Office
(KTO) by the Research and Innovation Foundation, to provide a cost-efficient solution for the support
of technology transfer, built on the principles of acquiring a critical mass of research output and
economies of scale. The KTO shall provide knowledge transfer services, facilitating
commercialisation of research, to universities, other research organisations and enterprises. Indicative
list of services: (a) evaluation of commercialisation prospects, (b) intellectual property rights advice,
(c) patents filed and intellectual property rights maintenance cases, (d) development of
commercialisation strategy, (e) technology marketing, (f) support in setting up spin-off companies,
and (g) provision of funding to support translational research.

The KTO shall become self-financed starting from 1 January 2026, by retaining 20% of revenue from
KTO managed agreements for operational costs, to be specified in the contractual arrangements
between the Research and Innovation Foundation and the beneficiary.

The implementation of the investment shall be completed by 31 December 2025.

Investment 2 (C3.2I2): Innovation funding programmes & funding schemes for the enhancement of

                     growth & competitiveness of start ups, innovative companies and SMEs

The objective of the measure is to provide grant support through innovation programmes (such as
Fast-Track Innovation, Pre-Seed, Seed, Innovate) as a means to improve access to funds for
innovative SMEs and start-ups.

The investment shall consist in a grant support through innovation programmes (for instance, FastTrack Innovation, Pre-Seed, Seed, Innovate) for businesses to develop innovative products and
services with international orientation from concept to ready-for-market. The funding programmes
shall (i) promote collaboration of businesses with research organisations; (ii) facilitate
commercialisation of research results in targeting delivery of closer-to-market outputs and outcomes,
thus allowing for shorter-term economic effects; (iii) lead to the creation of employment; (iv) promote
business clustering, and (v) target accelerated transition to a green economy and towards a digital era
of efficiency and productivity. These programmes shall require businesses to leverage private/own
funds in conjunction with public funding (provided by the Research and Innovation Foundation),
therefore contributing to the overall increase of R&D investment.

64

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the eligibility criteria contained in terms of reference for upcoming calls for projects
shall exclude the following list of activities [7] : (i) activities related to fossil fuels, including downstream
use; (ii) activities under the EU Emission Trading System achieving projected greenhouse gas
emissions that are not lower than the relevant benchmarks; (iii) activities related to waste landfills,
incinerators and mechanical biological treatment plants; and (iv) activities where the long-term
disposal of waste may cause harm to the environment. The terms of reference shall additionally
require that only activities that comply with relevant EU and national environmental legislation may
be selected.

The implementation of the investment shall be completed by 30 June 2026.

Investment 3 (C3.2I3): R&I funding program on green transition

The objective of the measure is to provide grant support through thematic R&I programmes of
relatively high technology readiness levels focusing on green transition.

The investment shall consist in grant support of projects that shall be using new technologies to
provide cost-effective solutions for green transition, thereby upgrading the country’s research
capacity. The supported projects shall focus on renewable energy, energy efficiency and sustainable
transport, entail collaboration with Centres of Excellence for R&I and/or other stakeholders, and
facilitate the commercialisation of research results.

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the eligibility criteria contained in terms of reference for upcoming calls for projects
shall exclude the following list of activities [8] : (i) activities related to fossil fuels, including downstream
use; (ii) activities under the EU Emission Trading System achieving projected greenhouse gas
emissions that are not lower than the relevant benchmarks; (iii) activities related to waste landfills,
incinerators and mechanical biological treatment plants; and (iv) activities where the long-term
disposal of waste may cause harm to the environment. The terms of reference shall additionally
require that only activities that comply with relevant EU and national environmental legislation may
be selected.

The implementation of the investment shall be completed by 30 June 2026.

Investment 4 (C3.2I4): Funding schemes to support organisations performing R&D activities on dual
technologies, including the creation of new or upgrade of existing laboratories and the development
of classified laboratories

The objective of the measure is to promote dual-use research and to use technologies, which would
otherwise only serve government/military purposes, for civilian, commercial and societal interests.

The investment shall consist in a grant support that would enable research organisations and
companies to engage in R&D on dual-use technologies. The funding schemes shall enable the upgrade
of the R&I capabilities and capacity of Research Centres of Excellence, academic institutions,
research organisations as well as companies engaged in R&D on dual use technologies. In particular,
they shall enable these organisations to acquire security classification certificates in order to be able
to participate in consortia for European funding (such as Horizon Europe, European Defence Fund)
as well as to enhance their R&I capabilities and competitiveness in the field of dual use technologies.

The funding shall focus on civil business only and research outcomes and infrastructure shall benefit
civil applications only. The measure shall comply with the Council Regulation (EC) No 428/2009 of
5 May 2009 on setting up a Community regime for the control of exports, transfer, brokering and

7 All footnotes set out in the text on measure C2.1I4 are also applicable to this measure.
8 All footnotes set out in the text on measure C2.1I4 are also applicable to this measure.

65

transit of dual-use items, regarding dual use technologies during the implementation of the funding
scheme, and shall be designed in line with ‘EU Funding for Dual Use – A practical guide to accessing
EU funds for European Regional Authorities and SMEs’.

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the eligibility criteria contained in terms of reference for upcoming calls for projects
shall exclude the following list of activities [9] : (i) activities related to fossil fuels, including downstream
use; (ii) activities under the EU Emission Trading System achieving projected greenhouse gas
emissions that are not lower than the relevant benchmarks; (iii) activities related to waste landfills,
incinerators and mechanical biological treatment plants; and (iv) activities where the long-term
disposal of waste may cause harm to the environment. The terms of reference shall additionally
require that only activities that comply with relevant EU and national environmental legislation may
be selected.

The implementation of the investment shall be completed by 30 June 2026.

9 All footnotes set out in the text on measure C2.1I4 are also applicable to this measure.

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**F.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|120|C3.2R1<br>National R&I<br>Policy and<br>policy tools|Milestone|Adoption of the<br>national R&I<br>Strategy and of<br>the Action Plan to<br>implement it|Publication of<br>the Council of<br>Ministers’<br>decision|-|-|-|Q4|2022|Develop an integrated R&I Strategy, providing a<br>long-term perspective framework, ensuring a<br>focused effort and commitment for<br>implementation, over time, on behalf of the State<br>and stakeholders involved in the national R&I<br>system, and a digital tool for the dynamic<br>mapping of the R&I ecosystem.<br>|
|121|C3.2R1<br>National R&I<br>Policy and<br>policy tools|Milestone|Completion of the<br>Action Plan for<br>the R&I Strategy|Publication of<br>the Council of<br>Ministers’<br>approval of the<br>final report,<br>attesting the<br>completion of<br>the action plan|-|-|-|Q2|2026|Implementation of the measures in the Action<br>Plan of the National Research and Innovation<br>Strategy, as evidenced by a final report.|
|122|C3.2R2<br>Incentives for<br>investments<br>and human<br>capital in R&I|Milestone|Tax exemption of<br>legal entities for<br>investing in<br>innovative<br>companies|Provision in<br>the law<br>indicating the<br>entry into<br>force of the<br>legislation|-|-|-|Q1|2022|Entry into force of a law establishing the tax<br>exemption of corporate investors (legal entities)<br>for investing in innovative companies.|
|123|C3.2R3<br>Policies to<br>foster access<br>to publicly<br>funded<br>research<br>infrastructure|Milestone|Digital registry to<br>record and<br>publish research<br>infrastructure|Link to the<br>digital registry<br>published in<br>the Deputy<br>Ministry for<br>Research,<br>Innovation and|-|-|-|Q4|2022|Development and start of operation of a digital<br>registry to record and publish research<br>infrastructure that shall facilitate the request of<br>access of interested parties to such infrastructure.<br>It shall include the mapping of all publicly<br>funded research institutions (under Horizon<br>2020, national schemes). It shall also improve|

67

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||and<br>laboratories|||Digital Policy<br>website||||||visibility of the Research Institutions and support<br>collaboration with the private sector.|
|124|C3.2R3<br>Policies to<br>foster access<br>to publicly<br>funded<br>research<br>infrastructure<br>and<br>laboratories|Milestone|Collaboration of<br>Research<br>Performing<br>Organisations<br>with business and<br>spin-offs|Publication of<br>measures and<br>incentives<br>adopted on the<br>Research and<br>Innovation<br>Foundation<br>website|-|-|-|Q4|2024|Adoption of measures and incentives to enhance<br>the collaboration of Research Performing<br>Organisations with business and spin-offs, such<br>as including in Research and Innovation<br>Foundation grant agreement a clause for opening<br>up funded infrastructure.|
|125|C3.2I1<br>Set up and<br>operate a<br>central<br>Knowledge<br>Transfer<br>Office (KTO)|Milestone|Launch of KTO|Opening of<br>KTO’s first<br>case|-|-|-|Q2|2022|The Research and Innovation Foundation,<br>responsible for putting in operation the KTO, has<br>hired or contracted highly trained staff and/or<br>experts to provide expert knowledge transfer<br>services. Systems and tools shall be in place to<br>support KTO operation. The KTO shall start the<br>provision of services to universities, other<br>research organisations or enterprises.|
|126|C3.2I1<br>Set up and<br>operate a<br>central<br>Knowledge<br>Transfer<br>Office (KTO)|Target|Case files closed<br>attesting<br>provision of<br>relevant<br>knowledge<br>transfer services|-|Number|0|30|Q4|2025|At least 30 completed cases of knowledge<br>transfer services provided by the central KTO to<br>universities, other research organisations or<br>enterprises.|
|127|C3.2I2<br>Innovation<br>funding<br>programmes<br>for start-ups,<br>innovative|Milestone|Signature of grant<br>agreements for<br>50% of budget|Grant<br>agreements<br>signed|-|-|-|Q4|2022|Signing of grant agreements which commit at<br>least 50% of total budget (contracts of a total<br>value of at least EUR 26 000 000 total budget)<br>for innovation funding programmes for start-ups,<br>innovative companies and SMEs, with terms of<br>reference including eligibility criteria that ensure|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||companies<br>and SMEs|||||||||that the selected projects comply with the ‘Do no<br>significant harm’ Technical Guidance<br>(2021/C58/01) through the use of an exclusion<br>list and the requirement of compliance with the<br>relevant EU and national environmental<br>legislation.|
|128|C3.2I2<br>Innovation<br>funding<br>programmes<br>for start-ups,<br>innovative<br>companies<br>and SMEs|Target|Organisations<br>supported to carry<br>out R&I related<br>activities|-|Number|0|70|Q3|2023|Funding support to at least 70 organisations to<br>carry out R&I related activities such as<br>industrial research, experimental research<br>innovation activities, start-up activities,<br>knowledge transfer activities, including (but not<br>limited to) activities for the management and<br>protection of intellectual property, for<br>establishing links between research organisations<br>and companies, for building knowledge transfer<br>capacity and for commercialising research<br>results, in compliance with the ’Do no<br>significant harm’ Technical Guidance<br>(2021/C58/01) through the use of an exclusion<br>list and the requirement of compliance with the<br>relevant EU and national environmental<br>legislation.|
|129|C3.2I2<br>Innovation<br>funding<br>programmes<br>for start-ups,<br>innovative<br>companies<br>and SMEs|Target|Organisations<br>supported to carry<br>out R&I related<br>activities|-|Number|70|200|Q2|2026|Funding support to at least 200 organisations to<br>carry out R&I related activities, in compliance<br>with the ’Do no significant harm’ Technical<br>Guidance (2021/C58/01) through the use of an<br>exclusion list and the requirement of compliance<br>with the relevant EU and national environmental<br>legislation.|
|130|C3.2I3|Milestone|Signature of grant<br>agreements for a|Grant<br>agreements|-|-|-|Q4|2022|Signing of grant agreements for the selected<br>proposals to be funded under a R&I funding|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||R&I funding<br>program on<br>green<br>transition<br> <br>||R&I funding<br>programme of<br>EUR 6 million<br>budget|signed by the<br>Director of the<br>Research and<br>Innovation<br>Foundation||||||program on green transition, with a total budget<br>of EUR 6 million, with terms of reference<br>including eligibility criteria that ensure that the<br>selected projects comply with the ‘Do no<br>significant harm’ Technical Guidance<br>(2021/C58/01) through the use of an exclusion<br>list and the requirement of compliance with the<br>relevant EU and national environmental<br>legislation.|
|131a|C3.2I3<br>R&I funding<br>program on<br>green<br>transition|Target|Organisations<br>supported by<br>grants on green<br>transition R&I<br>activities|-|Number|0|10|Q2|2026|At least 10 organisations supported by grants on<br>green transition R&I activities,in compliance<br>with the ’Do no significant harm’ Technical<br>Guidance (2021/C58/01) through the use of an<br>exclusion list and the requirement of compliance<br>with the relevant EU and national environmental<br>legislation.|
|132|C3.2I4<br>Funding to<br>organisations<br>performing<br>R&D<br>activities on<br>dual<br>technologies|Milestone|Signing of grant<br>agreements which<br>commit 80% of<br>total budget for<br>funding to<br>organisations<br>performing R&D<br>activities on dual<br>technologies|Grant<br>agreements<br>signed|-|-|-|Q2|2023|Signing of grant agreements which commit 80%<br>of total budget (contracts of at least a total value<br>of 2 400 000 euro total budget) for funding to<br>organisations performing R&D activities on dual<br>technologies, with terms of reference including<br>eligibility criteria that ensure that the selected<br>projects comply with the ‘Do no significant<br>harm’ Technical Guidance (2021/C58/01)<br>through the use of an exclusion list and the<br>requirement of compliance with the relevant EU<br>and national environmental legislation.|
|133|C3.2I4<br>Funding<br>organisations<br>performing<br>R&D|Target|Funding for the<br>development of<br>classified<br>Laboratories|-|Number|0|16|Q2|2026|At least 16 enterprises are receiving funding for<br>the development of classified laboratories. An<br>enterprise may be counted more than once if it<br>participates in more than one project, in<br>compliance with the ’Do no significant harm’|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||activities on<br>dual<br>technologies|||||||||Technical Guidance (2021/C58/01) through the<br>use of an exclusion list and the requirement of<br>compliance with the relevant EU and national<br>environmental legislation.|

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**G.** **COMPONENT** **3.3:** **B** **USINESS SUPPORT FOR** **C** **OMPETITIVENESS**

This component of the Cypriot Recovery and Resilience addresses the challenges of low productivity
and competitiveness of the economy, driven by the enterprises’ small size on average, the complex
licensing process requested for an investment and difficulties of access to funding to business. The
objectives of this component are to support entrepreneurs and enterprises and improve their
competitiveness and contribution to the growth of the economy by improving the regulatory
framework regarding investment and entrepreneurial activity and to enhance SMEs productivity,
mainly through digitalisation. It consists of six reforms and four investments, to be completed by Q2
2026.

The component addresses the Country-Specific Recommendation 3 of 2020 and Country-Specific
Recommendation 4 of 2019.

**G.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C3.3R1): Facilitation of Strategic investments

The objective of the measure is to develop a new system supporting strategic investments, aiming at
stimulating investment activity in the country through streamlined rules and mechanisms, simplifying
the licencing and permit procedures, reducing the administrative burden and making the strategic
investment environment more efficient. The definition of strategic investment refers to investments
in strategic sectors (including Health and Social Care, Education, Culture, Sport, Environment,
Industry, Tourism, Energy, Research, Development and Innovation) that significantly contribute to
the development of the economy.

The reform shall consist in the entry into force of a legislation for the facilitation of strategic
investments, in regards to the efficiency of obtaining investment licenses and building permits. A
dedicated governmental sector shall be assigned for the processing of strategic investments. It shall
consist in the preparation of the operational guidelines, process flows, and other ISO 9001:2015
requirements for mainstreaming the process. It shall develop Memorandum of Understandings with
other Departments relevant to parts of the process in order to ensure the fast-track mechanism’s
feasibility. Moreover, it shall include training of employees in the procedures to be introduced. In
addition, the reform shall benefit from the set-up of a digital platform that shall enable applying,
studying and issuing Planning and Building Permits digitally, through an application management
tool and a GIS system (project under Component 3.4: “enhancing e-system for issuing building
permits”).

The implementation of the reform shall be completed by 30 June 2023.

Reform 2 (C3.3R2): Enhancing Fast-Track Business Activation Mechanism

The objectives of the measure are the simplification of the procedures, the digitalisation of the
governmental services and the operation of a Business Support Centre that shall provide all necessary
and supportive information and services

The reform shall consist in the establishment of an interactive digital platform, enhancing the
Business Facilitation Unit. Through the platform the investor shall be able to track his/her application
but also the competent authorities shall be able to interact, exchange documents and process the
application.

The implementation of the reform shall be completed by 31 December 2025.

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Reform 3 (C3.3R3): Modernisation of the Companies Law

The objective of the measure is to support the improvement of the business environment by the review
of the Companies Act, making it clearer in interpreting and applying the law in practice.

The reform shall consist in modernising the Cyprus Companies Law by using best practices from
other common law jurisdictions to provide a foundation of knowledge and clarity in the form of case
law and literature, to assist in interpreting and applying the law in practice. The accompanying
Companies Rules shall also be reviewed. Moreover, Cyprus shall assign a team of legal experts to
undertake the project for advisory and drafting services of the new Companies Law and Regulations.
Moreover, the law review shall include the insolvency proceedings under the Companies Law, which
are Liquidations, Receivership and Examinership. Also, the reform shall include the undertaking of
an SME test during the preparing of the bill.

The implementation of the reform shall be completed by 30 June 2026.

Reform 4 (C3.3R4): Design and establish a National Promotional Agency

The objective of the reform is to improve access to finance for Small Medium Enterprises (SMEs) by
facilitating access to loans, guarantees and equity financing and enhance the absorption capacity of
EU financing through EU tools.

The reform shall consist in an ex-ante assessment analysis covering SMEs’ access to finance in all
sectors of the economy with a focus on green and circular economy, digital enablement and alternative
financing. The report shall define the scope of intervention of the proposed NPA. The legal and
organisational set-up of the National Promotional Agency shall be defined after the final selection of
its scope of activity. The proposed structure shall allow a high transparency of NPA's operations and
autonomy. The Agency shall not operate with a banking license and therefore shall not need to be
capitalised a priori. A steering committee, with the participation of representatives of the Ministry of
Finance and the Ministry of Energy, Commerce and Industry shall monitor the implementation.

The implementation of the reform shall be completed by 30 September 2025.

Reform 5 (C3.3R5): Strategic Investor of the Cyprus Stock Exchange

The objective of the reform is the privatisation of the Cyprus Stock Exchange.

The reform shall consist in a tender process, which is currently underway whereby the Cyprus Stock
Exchange seeks to appoint a reputable independent advisor or consortium thereof, with extensive
relevant expertise to find the most suitable strategic investor for the Cyprus Stock Exchange. The
privatisation phase of the contract shall be concluded upon final approval by the House of
Representatives of the Republic of Cyprus, after all other conditions have been met.

The implementation of the reform shall be completed by 31 December 2024.

Reform 6 (C3.3R6): Incentives to promote mergers & acquisitions

The objective of the measure is to incentivise the increase of SMEs’ size.

The reform shall consist in targeted incentives to promote the mergers or acquisitions of enterprises
in order to scale-up and become more competitive. In particular, the reform shall consist in the
approval of a report and an accompanying action plan by the Council of Ministers, following the
evaluation of similar regimes within the EU and consultation with stakeholders for specific incentives
for promoting mergers and acquisitions.

The implementation of the reform shall be completed by 31 December 2022.

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Investment 2 (C3.3I2): Creation of a Regulatory Sandbox to enable FinTech

The objective of the measure is to enable FinTech, start-ups, and other innovative companies to
expand their offering in new products or services, by regulators establishing a "testing ground" that
would allow them to conduct live experiments in a controlled environment under their supervision.

The investment shall consist in facilitating the development of a suitable and attractive regulatory
regime on FinTech and innovative technologies and strike a balance between the seamless
deployment of innovative products or services and ensuring investors’ protection.

The implementation of the investment shall be completed by 30 September 2025.

Investment 4 (C3.3I4): Scheme for the digital upgrade of enterprises

The objective of the investment is to enhance the integration of digital technology in existing and
future SMEs established in Cyprus. More specifically, the measure aims to enhance the digital
identity of the businesses, increasing the share of Small and Medium Enterprises that use information
and communication technologies, including the e-commerce sector, and to promote digital
entrepreneurship.

The investment shall consist in the provision of financial grants of about EUR 30 000 to each
beneficiary, as a share of what they shall have invested in eligible investment for the digital upgrade
of their enterprises.

The implementation of the investment shall be completed by 30 June 2026.

Investment 6 (C3.3I6): State funded equity fund

The objective of the measure is the establishment of a Fund to support the efforts of the Government
to enhance access to alternative sources of finance aiming to (i) foster economic development and
growth and enhance the competitiveness of small-medium enterprises in Cyprus; (ii) increase the
availability of alternative financing sources, particularly for innovative companies and start-ups; and
(iii) contribute to the enhancement of the ecosystem for equity and venture capital investments.

The investment shall consist in a tender procedure to select and appoint an external fund manager for
an investment period that is foreseen to be five years.

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the legal agreement between Cyprus and the Fund in charge of the financial
instrument and the subsequent investment policy of the financial instrument shall

i. require the application of the Commission’s technical guidance on sustainability proofing for
the InvestEU Fund; and

ii. exclude the following list of activities and assets from eligibility: (i) activities and assets
related to fossil fuels, including downstream use [10] ; (ii) activities and assets under the EU
Emission Trading System (ETS) achieving projected greenhouse gas emissions that are not

10 Except projects under this measure in power and/or heat generation, as well as related transmission and distribution
infrastructure, using natural gas, that are compliant with the conditions set out in Annex III of the ‘Do no significant harm’
Technical Guidance (2021/C58/01).

74

lower than the relevant benchmarks [11] ; (iii) activities and assets related to waste landfills,
incinerators [12] and mechanical biological treatment plants [13] ; and (iv) activities and assets
where the long-term disposal of waste may cause harm to the environment; and

iii. require the verification of legal compliance with the relevant EU and national environmental
legislation of the projects by Fund for all transactions, including those exempted from
sustainability proofing.

The implementation of the investment shall be completed by 30 June 2026.

11 Where the activity supported achieves projected greenhouse gas emissions that are not significantly lower than the
relevant benchmarks an explanation of the reasons why this is not possible should be provided. Benchmarks established
for free allocation for activities falling within the scope of the Emissions Trading System, as set out in the Commission
Implementing Regulation (EU) 2021/447.
12 This exclusion does not apply to actions under this measure in plants exclusively dedicated to treating non-recyclable
hazardous waste, and to existing plants, where the actions under this measure are for the purpose of increasing energy
efficiency, capturing exhaust gases for storage or use or recovering materials from incineration ashes, provided such
actions under this measure do not result in an increase of the plants’ waste processing capacity or in an extension of the
lifetime of the plants; for which evidence is provided at plant level.
13 This exclusion does not apply to actions under this measure in existing mechanical biological treatment plants, where
the actions under this measure are for the purpose of increasing energy efficiency or retrofitting to recycling operations
of separated waste to compost bio-waste and anaerobic digestion of bio-waste, provided such actions under this measure
do not result in an increase of the plants’ waste processing capacity or in an extension of the lifetime of the plants; for
which evidence is provided at plant level.

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**G.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|134|C3.3R1<br>Facilitation<br>of Strategic<br>investments|Milestone|Law for<br>strategic<br>investments|Provision in the<br>law indicating the<br>entry into force of<br>the law|-|-|-|Q1|2022|Entry into force of a law supporting strategic<br>investments in Cyprus which shall include<br>the following elements: streamlining of<br>procedures for licencing strategic<br>investment, project manager for each project,<br>timely issuance of building permits.|
|135|C3.3R1<br>Facilitation<br>of Strategic<br>investments|Milestone|Organisationa<br>l capacity’s<br>enhancement<br>for the<br>facilitation of<br>strategic<br>investments|Publication in the<br>official gazette<br>the setup of a<br>government<br>sector facilitating<br>the reform, and of<br>the process<br>system and<br>guidelines, and<br>stated verification<br>by the<br>coordinating<br>authority of<br>training<br>completion|-|-|-|Q2|2023|Publication in the official gazette of the<br>completion of the setup of a sector in the<br>Department of Town Planning and Housing<br>for the enhancement of the facilitation of<br>strategic system; publication of the process<br>system and of the guidelines design; and<br>reporting by the Coordinating authority of<br>key personnel training for the<br>implementation of the reform.|
|136|C3.3R2<br>Enhancing<br>Fast-Track<br>Business<br>Activation<br>Mechanism|Milestone|Establishment<br>of an<br>electronic<br>system where<br>investors can<br>submit their<br>online<br>application|Announcement<br>by the Ministry of<br>Commerce of the<br>electronic system<br>accepting<br>applications|-|-|-|Q4|2022|Upgrade of the services of applications for<br>business permit issuance, guidance for<br>establishment and operation, provision of<br>information for all the necessary permits<br>required by the company to start operations,<br>facilitation for the issuance of residence and<br>employment permits in Cyprus for third-<br>country nationals, application for registration<br>as a foreign interest company through the|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||establishment of an electronic system where<br>investors may submit their online<br>application.|
|137|C3.3R2<br>Enhancing<br>Fast-Track<br>Business<br>Activation<br>Mechanism|Target|Establishment<br>of a platform<br>where<br>investors can<br>track their<br>online<br>application<br>and interact<br>with the<br>competent<br>authorities<br>and<br>assessments<br>of<br>applications<br>for<br>investment<br>through the<br>platform|-|Number|0|50|Q4|2025|Completion of the assessment of at least 50<br>applications for investment through the<br>platform.|
|138|C3.3R3<br>Modernisati<br>on of the<br>Companies<br>Law|Milestone|Submission<br>of the draft<br>law to the<br>Parliament<br>for approval,<br>restructuring<br>the<br>Companies<br>Law|Submission of the<br>draft law to the<br>Parliament, after<br>its adoption by<br>the Council of<br>Ministers|-|-|-|Q3|2025|Submission of the draft law to the Parliament<br>for approval. The draft law shall restructure<br>the Companies Law. It shall in particular<br>modernise the Cyprus Companies Law by<br>using best practices from other common law<br>jurisdictions to provide a foundation of<br>knowledge and clarity in the form of case<br>law and literature and to assist in interpreting<br>and applying the law in practice.|

77

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|139|C3.3R3<br>Modernisati<br>on of the<br>Companies<br>Law|Milestone|Entry into<br>force of the<br>Companies<br>Law|Provision in the<br>law indicating the<br>entry into force of<br>the law|-|-|-|Q2|2026|Entry into force of the Companies Law<br>which shall restructure the Companies Law.<br>It shall in particular modernise the Cyprus<br>Companies Law by using best practices from<br>other common law jurisdictions to provide a<br>foundation of knowledge and clarity in the<br>form of case law and literature and to assist<br>in interpreting and applying the law in<br>practice.|
|140|C3.3R4<br>Design and<br>establish a<br>National<br>Promotional<br>Agency|Milestone|Approval by<br>the Council of<br>Ministers of<br>the roadmap<br>for the<br>creation and<br>establishment<br>of a National<br>Promotional<br>Agency|Publication of the<br>Council of<br>Ministers’<br>decision|-|-|-|Q2|2023|Approval by the Council of Ministers of the<br>roadmap for the creation and establishment<br>of a National Promotional Agency which<br>shall facilitate access to loans, guarantees<br>and equity financing to Small and Medium<br>Enterprises and enhance the absorption<br>capacity of EU financing through EU tools|
|141|C3.3R4<br>Design and<br>establish a<br>National<br>Promotional<br>Agency|Milestone|Start of<br>operations of<br>Cyprus<br>National<br>Promotional<br>Agency|Initial set-up<br>validated by<br>Permanent<br>Secretary|-|-|-|Q3|2025|Start of operations of Cyprus National<br>Promotional Agency, including staffing with<br>required staff|
|142|C3.3R5<br>Strategic<br>Investor of<br>the Cyprus<br>Stock<br>Exchange|Milestone|Selection of a<br>strategic<br>investor to<br>buy a<br>controlling<br>stake in|Council of<br>Ministers<br>approves<br>Agreement|-|-|-|Q4|2024|Selection of a strategic investor to buy a<br>controlling stake in Cyprus Stock Exchange,<br>signing of the relevant agreements, achieving<br>financial closing of the transaction.|

78

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||Cyprus Stock<br>Exchange||||||||
|143|C3.3R6<br>Incentives to<br>promote<br>mergers and<br>acquisitions.|Milestone|Action Plan<br>for incentives<br>for mergers<br>and<br>acquisitions|Council of<br>Ministers<br>adoption of a<br>report and the<br>accompanying<br>action plan|-|-|-|Q4|2022|Approval of a report and an accompanying<br>action plan by the Council of Ministers on<br>specific incentives for promoting mergers<br>and acquisitions, following the evaluation of<br>similar regimes within the EU and<br>consultation with stakeholders.|
|144|C3.3I2<br>Creation of a<br>Regulatory<br>Sandbox to<br>enable<br>FinTech|Milestone|Regulatory<br>Sandbox with<br>a view on<br>FinTech and<br>innovative<br>technologies|Announcement<br>for the launch of<br>the regulatory<br>Sandbox by<br>Cyprus Securities<br>and Exchange<br>Commission.|-|-|-|Q2|2024|Launch a Regulatory Sandbox which shall<br>facilitate the development of a suitable and<br>attractive regulatory regime on FinTech and<br>innovative technologies and strike a balance<br>between the seamless deployment of<br>innovative products or services and ensuring<br>investors’ protection.|
|147|C3.3I4<br>Scheme for<br>the digital<br>upgrade of<br>enterprises|Milestone|Publication of<br>call for<br>proposals<br>following<br>approval of<br>the scheme by<br>the Council of<br>Ministers|Official<br>announcement of<br>the call for<br>proposals in the<br>press, the<br>MECI/ITS<br>website and<br>MECI/ITS social<br>media|-|-|-|Q2|2023|Publication of call for proposals for grants<br>covering a percentage of expenditure that<br>shall enhance the digital identity of the<br>businesses, or shall increase the amount of<br>small and medium-size enterprises that use<br>information and communication technologies<br>(including the e-commerce sector), or shall<br>promote digital entrepreneurship, following<br>approval of the scheme for the digital<br>upgrade of enterprises by the Council of<br>Ministers.|
|148|C3.3I4<br>Scheme for<br>the digital<br>upgrade of<br>enterprises|Target|SMEs<br>supported<br>following<br>submission of<br>payment<br>applications.|-|Number|0|290|Q2|2026|At least 290 SMEs supported following<br>submission of payment applications and<br>administrative and on the spot verifications<br>performed by the responsible Scheme<br>Management Team.|

79

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|151|C3.3I6<br>State funded<br>equity fund|Milestone|Setup of the<br>Fund|Registration of<br>the Fund|-|-|-|Q4|2022|The setup of the Fund is completed. The Fund<br>shall increase the availability of alternative<br>financing sources, particularly for innovative<br>companies and start-ups.<br> <br>The investment policy shall include eligibility<br>criteria for investees to ensure compliance<br>with the ‘Do no significant harm’ Technical<br>Guidance<br>(2021/C58/01)<br>of<br>supported<br>transactions under this measure through the<br>use of sustainability proofing, the requirement<br>of compliance with the relevant EU and<br>national environmental legislation, and the<br>requirement for beneficiaries that derived<br>more than 50% of their revenues during the<br>preceding financial year from activities or<br>assets in the exclusion list to adopt and<br>publish green transition plans.|
|152|C3.3I6<br>State funded<br>equity fund|Target|Investees<br>supported<br>through the<br>Fund|-|Number|0|12|Q2|2026|At least 12 investees (start-ups and<br>innovative companies) supported through the<br>Fund.|

80

**G.3.** **Description of the reforms and investments for the loan**

Investment 1 (C3.3I1): Integrated Information system for the Department of Registrar of Companies
and Intellectual Property.

The objectives of the measure are the design, development, implementation, maintenance and
operation of an Integrated Registry Platform solution supporting the processes and services of the
Companies Section and Intellectual and Industrial Property Section of the Department of Registrar of
Companies and Intellectual Property, in such a way to drive the digital transformation of the two
aforementioned sections to become established as frontrunners in digital presence, online capabilities
and outstanding customer service delivered by efficient internal processes and supported by flexible
IT systems.

The investment shall consist in the installation of the hardware and software of the system, completing
the network infrastructure, and the training of the personnel for the new system.

The implementation of the investment shall be completed by 31 December 2025.

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**G.4.** **Milestones, targets, indicators, and timetable for monitoring and implementation for the loan**

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|153|C3.3I1<br>Integrated<br>Information<br>system for the<br>Department of<br>Registrar of<br>Companies and<br>Intellectual<br>Property|Milestone|System<br>hardware<br>and<br>software<br>installation<br>and<br>networking<br>completed|Issuance of<br>completion<br>and of<br>operation for<br>the installation<br>of system<br>hardware &<br>software and<br>networking<br>completed|-|-|-|Q1|2024|Installation of system hardware & software<br>and networking completed (servers, hard<br>disks, PCs and peripherals, RDBMS,<br>operating systems and routers).|
|154|C3.3I1<br>Integrated<br>Information<br>system for the<br>Department of<br>Registrar of<br>Companies and<br>Intellectual<br>Property|Target|Training of<br>personnel|-|% <br>(Percentage)|0|100|Q4|2025|Training of 100% of personnel of the<br>Department of Registrar of Companies and<br>Intellectual Property and the Department of<br>Information Technology Services<br>personnel on the rolled-out information<br>system and related operational procedures.|

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**H.** **COMPONENT** **3.4:** **M** **ODERNISING PUBLIC AND LOCAL AUTHORITIES** **,** **MAKING JUSTICE MORE**

**EFFICIENT AND FIGHTING CORRUPTION**

This component of the Cypriot recovery and resilience plan addresses long-standing challenges in the
functioning of public administration, at both the central and the local levels, the justice system and
the anti-corruption framework. The objectives of the component are: (i) to increase the effectiveness,
efficiency and relevance of government processes, considering current challenges, needs, and
expectations of citizens and businesses, (ii) to strengthen the administrative capacity and cooperation
of the Ministry of Interior and local governments to ensure the effective implementation of the new
local administration model, (iii) to improve the effectiveness, including quality and efficiency, of the
justice system, through accelerating the administration of justice and reducing the backlog of cases,
and (iv) to achieve greater coherence to the government’s efforts to fight corruption.

The reforms and investments included in the component contribute to addressing the CountrySpecific Recommendations on improving efficiency in the public sector, in particular as regards the
functioning of the public administration and of local governments (Country-Specific
Recommendations 1 of 2019 and 4 of 2020), on promoting flexible working arrangements (CountrySpecific Recommendation 2 of 2020), on improving the efficiency and digitalisation of the judicial
system (Country-Specific Recommendation 5 of 2019 and Country-Specific Recommendation 4 of
2020) and on anti-corruption reforms (Country-Specific Recommendation 5 of 2019).

**H.1.** **Description of the reforms and investments for non-repayable financial support**

**Subcomponent 3.4.1: Modernising the Public Sector**

Reform 1 (C3.4R1): Enhance the administrative capacity and improve the functioning of public
administration for better policy making and implementation

The objective of the reform is to improve the functioning of general public administration by
improving its human resource management framework and to restructure and enhance the
administrative capacity of the Cyprus Police.

The reform shall consist of two elements:

i) Development and implementation of an action plan to strengthen the administrative capacity
and the strategic role in human resource management of the Public Administration and Personnel
Department relating to the formulation and monitoring of implementation of public administration
and human resource management policies in the public sector, such as policy setting, formulation of
guidelines and basic principles on human resource management matters, review of existing policies,
legislation and practices, and industrial relations. In parallel, the reform shall enhance line Ministries’
capacity to implement public administration policies and human resource functions, while ensuring
adequate accountability and responsiveness;

ii) reorganisation and modernisation of the Cyprus Police by designing and implementing a new
model of policing and operations, a new management framework for learning and development, and
a new human resources management framework.

The implementation of the reform shall be completed by 31 December 2025.

Reform 2 (C3.4R2): Regulate flexible working arrangements in the public sector

The objective of the reform is to increase productivity and effectiveness of the public service through
the use of flexible working arrangements, such as working remotely, partly remotely, and part-time.

The reform shall consist in implementing flexible working arrangements in the public sector on the
basis of an assessment by the Public Administration and Personnel Department of the
recommendations of an external study of best practices and possible limitations noted by other
national public administrations. The study shall review the terms and conditions for flexible working
arrangements in the public service as applied in other jurisdictions.

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The implementation of the reform shall be completed by 31 December 2024.

Reform 3 (C3.4R3): Introduce new framework for evaluation and selection process for filling public
service vacancies and new regulations for the evaluation of employees’ performance

The objective of the reform is to improve the functioning of the public service through a review of
the recruitment and promotion framework and of the performance appraisal system.

The reform shall consist of: (i) introducing a new framework in the public service for the evaluation
and selection of candidates for promotion posts, including managerial posts, based on merit; (ii)
introducing a new performance appraisal system to be used for development and promotion purposes
in order to make appraisal and promotion more transparent, fair, skill-based and effective; and (iii)
improving the recruitment procedures through training, update of the Schemes of Service (the set of
requirements and duties for jobs in the public administration) and changes in the two relevant laws
for recruitment.

The implementation of the reform shall be completed by 31 March 2025.

Reform 4 (C3.4R4): Strengthen administrative capacity and transparency through the
professionalisation of public procurement and further digitalisation of its process

The objective of the reform is to increase the efficiency and effectiveness of public procurement by
introducing new procurement processes using digital tools and increasing knowledge and expertise
of personnel.

The reform shall consist in introducing an integrated fully digitalised e-procurement system using
modern technologies, thus reducing administrative burden for participants while safeguarding
accountability and transparency. It shall be accompanied by measures aimed at the professionalisation
of public procurement, such as revising the organisational structure of the central professional public
procurement function and training and certification of procurement professionals.

The implementation of the reform shall be completed by 31 December 2025.

Reform 5 (C3.4R5): Enhancement of the capacity of the Law Office

The objective of the reform is to implement a digital transformation of the Law Office, aiming to
increase its efficiency and effectiveness, as well as the productivity, quality of work and working
conditions of the employees.

The reform shall consist in digitalising all the processes and procedures of the Law Office by
introducing an IT system (eLaw System), which shall be delivered as a complete Software-as-aService solution. It shall include the supply, development and customisation of an existing web-based
management system to provide features such as the creation of electronic case files and folders, case
management and monitoring, internal communication and workflows, tracking of cases, financial
management and payments. During the implementation of the project, a business analysis shall assess
needs for process re-engineering. All existing paper files shall be migrated into the core eLaw System.

The implementation of the reform shall be completed by 31 December 2023.

                             Investment 2 (C3.4I2): Digitalisation of the law making process

The objective of the investment is to improve the quality of regulation and increase legal certainty
and transparency by modernising the legislative drafting process and publication of applicable
legislation.

84

The investment shall consist in establishing a legislation preparation platform enabling easier
drafting, consolidation, management and storing of laws and regulations. The system shall also
become the official government single point of digital access for the public to all legislation texts in
an interoperable format. The investment shall cover the upload of all existing laws and regulations
into the new platform.

The implementation of the investment shall be completed by 31 December 2025.

Investment 3 (C3.4I3): Economic Policy Modelling Hub

The objective of the investment is to improve policymaking and implementation by increasing the
use of quantitative modelling techniques for regulatory impact assessment.

The investment shall consist in developing modelling tools and expertise among public personnel to
allow for better policy impact assessment. This shall be achieved by (i) establishing an Economic
Policy Modelling Hub disposing of the tools and data for policy analysis and evaluation; (ii)
transferring the policy analysis and evaluation knowledge to the employees of the Ministry of
Finance; and (iii) developing tools for big data and data analytics.

The implementation of the investment shall be completed by 31 December 2025.

**Subcomponent 3.4.2: Local Administration and Spatial reform**

Reform 6 (C3.4R6): New legal framework for Local Authorities and relevant support measures

The objective of the measure is to reform the local government system in Cyprus to improve its
decision-making power and administrative autonomy, to increase efficiency of governance and to
align resources and responsibilities to ensure financial sustainability.

The reform shall consist in adopting new legislation that shall: reduce the number of municipalities
and create community clusters for the centralised provision of services in order to improve
administrative capacity; introduce a new model of administration and a new staff structure for
municipalities; transfer competences and resources from the central government to the municipalities,
in particular in the areas of issuing permits, social policy, local infrastructure maintenance, schools
and the provision of local services to the citizens; reform the financing of municipalities; and ensure
adequate legal supervision, transparency and democratic accountability. The reform shall also include
capacity building through training.

The implementation of the reform shall be completed by 31 December 2024.

Reform 7 (C3.4R7): Urban land consolidation

The objective of the reform is to reduce the pressure for municipalities’ expansion and increasing soil
seal by facilitating the utilisation of available land for construction purposes.

The reform shall consist in setting up a legislative framework for urban land consolidation and
promoting implementation of urban land consolidation master plans in selected areas or in areas of
strategic significance for the island. The reform shall also include the preparation of an expert study,
a digital platform for enabling urban land consolidation, and the preparation of urban land
consolidation pilot master plans.

The implementation of the reform shall be completed by 31 December 2025.

                      Investment 4 (C3.4I4): Enhancing e system for issuing building permits

The objective of the investment is to increase the efficiency of building permit procedures.

85

The investment shall consist of (i) expanding the e-application environment of the existing
Hippodamos IT system for planning and permitting, to enable all planning authorities and building
authorities (municipalities) to submit applications for planning and building permits from a common
platform; (ii) upgrading the Hippodamos system to enable applying, studying and issuing planning
and building permits digitally; and (iii) upgrading or expanding other Hippodamos modules, such as
construction contract management and administration.

The implementation of the investment shall be completed by 31 December 2024.

Investment 5 (C3.4I5): Smart cities

The objective of the investment is to coordinate on-going smart cities initiatives into a nationwide
implementation plan.

The investment shall consist in putting forward a Smart City National Master Plan, focussing on three
priority smart solutions for municipalities: smart parking, smart lighting and smart waste collection
management. The investment shall entail the design and implementation of the smart city
infrastructure (central platform) as well as the design and implementation of the three priority smart
solutions, including the installation of sensors. The central platform shall have the necessary
flexibility for future additions of new smart cities solutions.

The implementation of the investment shall be completed by 30 June 2026.

Investment 6 (C3.4I6): Regeneration and Revitalisation of Nicosia Inner City

The objective of the investment is to revitalise the Nicosia inner city by attracting young residents,
new investments and fostering economic activity.

The investment shall consist of (i) the renovation of the Faneromeni School to be used as a department
of the University of Cyprus; (ii) the purchase and renovation of buildings in the inner city to be
transformed into student accommodation; and (iii) the introduction of private sector incentives to
provide student accommodation in the area.

The implementation of the investment shall be completed by 30 June 2026.

**Subcomponent 3.4.3: Efficient Justice System**

Reform 8 (C3.4R8): Efficiency of Justice

The objective of the reform is to reduce the high backlog of cases pending before the courts and to
increase the overall efficiency and quality of the justice system.

The reform shall consist in preparing an action plan to eliminate the backlog of cases and appeals
with specific annual targets and setting up a taskforce of judges, which is expected to coordinate the
implementation of the action plan to reduce the backlog of pending cases. The action plan is expected
to be completed by 31 December 2021. Pending cases shall be defined as cases pending for more than
two years. On 31 December 2020 there were: 24 777 pending civil cases, 2 222 pending appeals of
civil cases, and 475 pending appeals of administrative cases. The reform shall also consist in
implementing the revised Rules of Civil Procedure, which were adopted by the Supreme Court on 19
May 2021 and which shall increase efficiency in the judicial proceedings including in adjudicating

cases.

The implementation of the reform shall be completed by 30 June 2026.

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Reform 9 (C3.4R9): Digital transformation of courts

The objective of the reform is to address the inefficiencies of the justice system caused by the courts
operating based on manual and paper-based systems. The digitalisation of the system shall streamline
and expedite justice.

The reform shall consist in installing and operating (i) the i-justice system an interim solution to
address the most pressing needs before the e-justice is available, (ii) an integrated e-justice system
and (iii) digital audio recording in court proceedings. The e-justice system shall be accessible to
courts, lawyers, citizens, the Law Office of the Republic and the Police. It shall introduce several
functions such as digital case filing and payment, case categorisation, case searching, document
production and management, tracking and monitoring systems to support the streaming of cases,
monitoring compliance with orders and protocols, managing allocations of cases to hearing, decision
execution and management, case closing and evidence management.

The implementation of the reform shall be completed by 31 March 2025.

Investment 7 (C3.4I7): Training of judges

The objective of the investment is to address the low level of training and lifelong learning for judges.

The investment shall consist in training of judges on the revised Civil Procedure Rules and/or other
judicial trainings on various legal topics and judicial skills organised by the Cyprus School for
Judicial Training.

The implementation of the investment shall be completed by 31 December 2025.

Investment 8 (C3.4I8): Upgrading the infrastructure of courts

The objective of the investment is to address inefficiencies of the justice system caused by inadequate
court buildings, both in terms of quantity and quality.

The investment shall consist of the construction of an extension to the Famagusta District Court
building.

The implementation of the investment shall be completed by 31 December 2021.

**Subcomponent 3.4.4: Fighting Corruption**

Reform 10 (C3.4R10): Improving the legal and institutional framework for fighting corruption

The objective of the reform is to achieve greater coherence in the fight against corruption by
implementing the national horizontal action plan against corruption.

The reform shall consist of: (i) legislation to protect whistle-blowers, to enhance transparency in
public decision-making processes and to prevent conflict of interest, (ii) establishment and operation
of an independent authority against corruption, which shall coordinate the efforts of all bodies
engaged in the fight against and prevention of corruption and shall supervise the timely
implementation of actions by the different competent services (iii) anti-corruption public awareness
and trainings and (iv) reinforcement of the Internal Audit Units in all the Ministries and the Internal
Audit Service.

The implementation of the reform shall be completed by 30 June 2024.

87

**H.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|155|C3.4R1<br>Enhance the<br>administrative<br>capacity and<br>improve the<br>functioning of<br>public<br>administration<br>for better policy<br>making and<br>implementation|Milestone|Action Plan on<br>the efficient<br>management of<br>human resource<br>issues in the<br>national public<br>administration<br>|Adoption of the<br>Action Plan by<br>the Council of<br>Ministers|-|-|-|Q1|2022|The Council of Ministers has adopted an<br>Action Plan that shall include:<br>- Guidelines, templates and<br>implementation support by the Public<br>Administration and Personnel<br>Department (PAPD) to line ministries’<br>administration in relation to human<br>resource management issues such as re-<br>organisation and re-structuring,<br>simplification of procedures and<br>workforce planning;<br>- Implementation of a revised<br>organisational structure of PAPD<br>- Learning and Development Plan for<br>PAPD staff;<br>- Training Plan for line ministries’<br>administration|
|156|C3.4R1<br>Enhance the<br>administrative<br>capacity and<br>improve the<br>functioning of<br>public<br>administration<br>for better policy<br>making and<br>implementation|Milestone|New human<br>resources<br>management<br>framework for<br>Cyprus Police|Adoption by the<br>Chief of Police<br>and the<br>Permanent<br>Secretary of the<br>Ministry of<br>Justice and<br>Public Order,<br>and entry into<br>force|-|-|-|Q4|2023|The new human resources management<br>framework for Cyprus Police has entered<br>into force and shall cover following<br>areas:<br>- Analysis and creation of job<br>descriptions<br>- Recruitment<br>- Motivation<br>- Training and Development<br>- Compensation and Benefits<br>- Labour and employee relations and<br>communication<br>- Management of retired members|

88

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||- Safety and Health<br>- Human resource management strategy|
|157|C3.4R1<br>Enhance the<br>administrative<br>capacity and<br>improve the<br>functioning of<br>public<br>administration<br>for better policy<br>making and<br>implementation|Milestone|Implementation<br>of the Action<br>Plan on the<br>efficient<br>management of<br>human resource<br>issues in the<br>national public<br>administration|Final report<br>approved by the<br>Council of<br>Ministers on the<br>implementation<br>of the Action<br>Plan|-|-|-|Q4|2025|The Action Plan has been implemented,<br>including:<br> <br>- Guidelines and manuals for line<br>ministries’ administration regarding<br>recruitment procedures, disciplinary<br>procedures, workforce planning, re-<br>organisation and simplification of<br>processes reviews<br>- Legislative amendments where<br>appropriate<br>- Training of staff in line ministries’<br>administration|
|158|C3.4R2<br>Regulate<br>flexible<br>working<br>arrangements in<br>the public<br>sector|Milestone|Decision on<br>flexible working<br>arrangements in<br>the public sector|Decision by the<br>Council of<br>Ministers|-|-|-|Q1|2023|A study regarding flexible working<br>arrangements in the public sector shall be<br>conducted. The PAPD shall assess the<br>study’s recommendations considering<br>appropriate safeguards aiming at<br>improving the effectiveness of the public<br>service. Following the assessment of the<br>study’s recommendations, a decision<br>regarding their implementation shall be<br>taken by the Council of Ministers.|
|159|C3.4R2<br>Regulate<br>flexible<br>working<br>arrangements in<br>the public<br>sector|Milestone|Implementation<br>of flexible<br>working<br>arrangements|Final report by<br>the PAPD on<br>implementation<br>of the Council<br>of Ministers<br>Decision|-|-|-|Q4|2024|Implementation of the decision of the<br>Council of Ministers, through, where<br>relevant, amendment of law/regulations,<br>communication of policies and trainings,<br>on the basis of an action plan developed<br>by the Public Administration Personnel<br>Department.|

89

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|160|C3.4R3<br>Introduce new<br>framework for<br>evaluation and<br>selection<br>process for<br>filling public<br>service<br>vacancies and<br>new regulations<br>for the<br>evaluation of<br>employees’<br>performance|Milestone|Entry into force<br>of legislation for<br>the evaluation<br>and selection<br>process for<br>public service<br>vacancies and<br>regulations for<br>employees’<br>performance<br>evaluation.|Provision in the<br>relevant law(s)<br>and regulations<br>indicating their<br>respective entry<br>into force|-|-|-|Q4|2021|The main elements shall be:<br>(i) entry into force of a law providing for<br>the evaluation and selection of candidates<br>to fill the public service promotion posts,<br>including managerial posts, with new<br>criteria and methods based on objective<br>assessment and merit, and amendment of<br>the Public Service Law where deemed<br>necessary, and <br>(ii) entry into force of new regulations for<br>implementing a new performance<br>appraisal system for public employees, to<br>be used for development and promotion<br>purposes in order to make the<br>performance appraisal procedure and the<br>promotion mechanism more transparent,<br>fair, skill-based and effective|
|161|C3.4R3<br>Introduce new<br>framework for<br>evaluation and<br>selection<br>process for<br>filling public<br>service<br>vacancies and<br>new regulations<br>for the<br>evaluation of<br>employees’<br>performance|Milestone|New framework<br>for performance<br>evaluation and<br>filling of<br>vacancies in the<br>public service.|Entry into use<br>of the new<br>framework|-|-|-|Q1|2025|Civil servants’ performance shall be<br>evaluated and public service vacancies<br>filled in accordance with the new legal<br>framework, following its effective<br>implementation including through<br>training of relevant employees.|

90

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|162|C3.4R4<br>Strengthen<br>administrative<br>capacity and<br>transparency<br>through the<br>professionalisati<br>on of public<br>procurement<br>and further<br>digitalisation of<br>its process|Milestone|New integrated<br>e-procurement<br>system|First calls for<br>tender have<br>been launched<br>under the new<br>e-procurement<br>system|-|-|-|Q4|2025|The new integrated e-procurement system<br>shall be fully operational including all<br>development, testing and training of<br>users.<br> <br>The main functionalities of the system<br>shall be:<br>- support the only once principle for<br>submission of data by private users<br>- statistical reporting<br>- support the use of emerging<br>technologies that may be used by both<br>contracting authorities and economic<br>operators in their administrative<br>functionalities<br>- Facilitate the administrative work of the<br>contracting authorities<br>- User-friendly interface to economic<br>operators with emphasis on SMEs<br>- Publication of open data regarding the<br>public procurement procedures<br>- Provide the contracting authorities and<br>the decision-makers information<br>regarding public procurement procedures,<br>throughout the project life cycle.|
|163|C3.4R5<br>Enhancement of<br>the capacity of<br>the Law Office|Milestone|New IT system<br>for the Law<br>Office|Entry into<br>service of the<br>new IT system|-|-|-|Q4|2023|Full operationalisation of a Software-as-<br>a-Service solution for the Law Office that<br>shall have the following features:<br>- creation of electronic case files and<br>folders,<br>- case management and monitoring,<br>- internal communication and work flows,|

91

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||- tracking of cases, financial management<br>and payments,<br>- digitalisation of paper files.<br>Training of users has been concluded.|
|165|C3.4I2<br>Digitalisation of<br>the law-making<br>process|Milestone|Implementation<br>of the Cyprus<br>Legislation<br>Preparation<br>Platform|Entry into<br>service of the<br>new system|-|-|-|Q1|2025|Entry into operation of the Platform and<br>completion of training for administrators<br>and privileged users.<br> <br>The fully functioning Legislation<br>Preparation Platform shall enable:<br>- drafting and management of bills<br>through a web editor, with possibility to<br>export in XML format at all stages of the<br>law preparation process,<br>- a central database to store and<br>disseminate the legal texts as open data<br>though Application Programming<br>Interfaces, as well as in bulk;<br>- a tool to consolidate laws and<br>amendments.|
|166|C3.4I2<br>Digitalisation of<br>the law-making<br>process|Milestone|Digitalisation of<br>laws &<br>regulations in<br>the new<br>platform|Public<br>announcement<br>on the platform|-|-|-|Q4|2025|All past laws and regulations have been<br>uploaded into the new platform, so that<br>all legislation is available online on a<br>governmental platform.|
|167|C3.4I3<br>Economic<br>Policy<br>Modelling Hub|Milestone|Setting up a<br>Modelling Hub<br>for Economic<br>Policy Analysis|Entry into<br>service of the<br>Hub<br>|-|-|-|Q4|2023|Full operationalisation and equipment of<br>the Hub including appointment of the<br>team of scientific staff. The team shall<br>consist of experts on macroeconometric<br>models, econometricians, data analytics<br>experts and economists.|

92

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|168|C3.4I3<br>Economic<br>Policy<br>Modelling Hub|Target|Number of<br>developed<br>impact<br>assessment<br>models and data<br>analysis tools|-|Number|0|20|Q4|2025|Complete development of at least 20<br>macro-econometric impact assessment<br>models and new data analytics tools for<br>the Cyprus economy based on different<br>methodologies shall be simulated, tested<br>and applied for economic policy analysis<br>and forecasting.|
|169|C3.4R6<br>New legal<br>framework for<br>Local<br>Authorities and<br>relevant support<br>measures|Milestone|New legal<br>framework on<br>local authorities|Provision in the<br>law indicating<br>the entry into<br>force of the<br>legislation|-||-|Q2|2024|The intervention shall consist of the entry<br>into force of three laws: Municipalities<br>Law, Communities (Amending) Law and<br>the Law on District Local Government<br>Organisations).<br> <br>The new legal framework shall entail:<br>- Reduction in the number of<br>municipalities<br>- Creation of community clusters for the<br>provision of services<br>- Transfer of new competences and funds<br>from central government to the<br>municipalities<br>- New system of financing of<br>municipalities<br>- Rules on legal supervision, transparency<br>and accountability<br>- Improvement of the efficiency of water<br>supply, sewerage and solid waste<br>management as well as permitting by<br>creating five District Organisations for<br>Local Administration.|
|170|C3.4R6|Target|Number of local<br>authority staff|-|Number|0|500|Q4|2024|Completion of a series of thematic<br>capacity building programmes for local|

93

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||New legal<br>framework for<br>Local<br>Authorities and<br>relevant support<br>measures||participating in<br>capacity<br>building|||||||administration, providing training to at<br>least 500 participants (members and staff<br>of local authorities).|
|171|C3.4R7<br>Urban land<br>consolidation|Milestone|Entry into force<br>of the law on<br>urban land<br>consolidation|Provision in the<br>law indicating<br>the entry into<br>force of the law|-|-||Q2|2024|Entry into force of the law on urban land<br>consolidation with the aim to reduce<br>urban sprawl through rational utilisation<br>of existing residential areas|
|172|C3.4R7<br>Urban land<br>consolidation|Target|Number of<br>master plans for<br>urban planning|-|Number|0|10|Q4|2025<br>|Master plans for urban planning have<br>been drafted, published and approved for<br>utilisation in selected areas or in areas of<br>strategic significance. The master plans<br>shall integrate and redistribute into land<br>parcels segmented and inaccessible land<br>(within the development limits of an<br>area).|
|173|C3.4I4<br>Enhancing e-<br>system for<br>issuing building<br>permits|Milestone|Enhancement of<br>the e-application<br>environment of<br>the Hippodamos<br>System|Applications<br>being received<br>through the<br>enhanced e-<br>application<br>environment|-|-|-|Q4|2022 <br>|Completion of the enhancement of the e-<br>application environment of the existing<br>Hippodamos system to enable the<br>submission of applications for planning<br>and building permits for all planning<br>authorities and building authorities<br>(municipalities) from a common<br>platform.|
|174|C3.4I4<br>Enhancing e-<br>system for<br>issuing building<br>permits|Milestone|Enhancement of<br>planning and<br>control and<br>project<br>management|Fully digital<br>process for<br>permit issuance<br>and<br>construction|-|-|-|Q4|2024|Completion of the enhancement of the<br>planning and control tool, project<br>management tool and of the upgrade of<br>the hardware and software of existing<br>Hippodamos System to support the<br>additional functionalities.|

94

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||functionalities<br>of Hippodamos|contract<br>management|||||||
|176|C3.4I5<br>Smart cities|Target|Development of<br>mobile<br>applications<br>developed as<br>part of the smart<br>cities initiative<br>and installation<br>of smart sensors<br>in service as<br>part of the smart<br>cities initiative|-|Mobile<br>Applications:<br>Number<br> <br>Smart<br>sensors:<br>Number|Mobile<br>Applications:<br>0 <br> <br>Smart sensors:<br>Number<br>0|Mobile<br>Applications:<br>3 <br> <br>Smart sensors:<br>97 000<br>|Q2|2026|Development of three mobile applications<br>(for smart parking, smart lighting, smart<br>waste management), which shall be<br>available for download by users, and full<br>operationalisation of at least 97 000 smart<br>sensors as part of the smart cities<br>initiative consisting of smart parking<br>sensors, smart lighting sensors and smart<br>waste management sensors delivered and<br>installed in municipalities and connected<br>to the central smart cities platform.|
|177|C3.4I6<br>Regeneration<br>and<br>Revitalisation<br>of Nicosia Inner<br>City|Target|Rooms<br>renovated and<br>converted to<br>student dorms|-|Number|0|80|Q4|2024|At least 80 rooms in Nicosia’s inner city<br>have been renovated and converted to<br>student dorms|
|178|C3.4I6<br>Regeneration<br>and<br>Revitalisation<br>of Nicosia Inner<br>City|Target|Rooms<br>renovated and<br>converted to<br>student dorms|-|Number|80|450|Q2|2026|At least 450 rooms in Nicosia’s inner city<br>have been renovated and converted to<br>student dorms|
|179|C3.4I6<br>Regeneration<br>and<br>Revitalisation<br>of Nicosia Inner<br>City|Milestone|Renovation of<br>Faneromeni<br>School|Completion of<br>the renovation<br>of Faneromeni<br>school|-|-|-|Q2|2026|Faneromeni School has undergone<br>extensive renovation and complete anti-<br>seismic upgrade to house the School of<br>Architecture of the University of Cyprus<br>and is ready for use <br>|

95

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|180|C3.4R8<br>Efficiency of<br>Justice|Milestone|Entry into force<br>of new Rules of<br>Civil Procedure|Provision in<br>new Rules of<br>Civil Procedure<br>(published in<br>the Official<br>Gazette)<br>indicating the<br>entry into force<br>of the Rules of<br>procedures (1<br>September<br>2023)|-|-|-|Q3|2023|Implementation of the new Rules of Civil<br>Procedure for the new cases submitted to<br>the court as from 1 September 2023. The<br>new Rules of Civil Procedure shall<br>modernise the hearing of cases in order to<br>deliver a less costly, more accessible and<br>timelier service to parties.|
|181|C3.4R8<br>Efficiency of<br>Justice|Target|Reducing the<br>backlog of cases<br>and appeals|-|% <br>(Percentage)|0|20|Q2|2024|Reduction of the backlog of cases and<br>appeals pending for over two years before<br>the District Courts and the Supreme<br>Court by 20% from the 31 December<br>2020 level, as verified by an Annual<br>Progress Report of the Action Plan to<br>reduce backlog.|
|182|C3.4R8<br>Efficiency of<br>Justice|Target|Further reducing<br>the backlog of<br>cases and<br>appeals|-|% <br>(Percentage)|20|40|Q2|2026|Reduction of the backlog of cases and<br>appeals pending for over two years before<br>the District Courts and the Supreme<br>Court by 40% from the 31 December<br>2020 level, as verified by an Annual<br>Progress Report of the Action Plan to<br>reduce backlog.|
|183|C3.4R9<br>Digital<br>transformation<br>of courts|Milestone|e-justice system|Verification of<br>the contract and<br>acceptance of<br>the deliverables<br>by the project<br>teams for the|-|-|-|Q1|2024|Installation and full operation of the e-<br>justice system and completion of on-site<br>operational support of the i-justice<br>system.  Both systems shall be available<br>through the court’s website.|

96

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||two systems.<br>Both systems<br>available<br>through the<br>court’s website|||||||
|184|C3.4R9<br>Digital<br>transformation<br>of courts|Milestone|Digital audio<br>recording in<br>court<br>proceedings|Verification of<br>the contract and<br>acceptance of<br>the deliverables<br>by the project<br>team for the<br>system.|-|-|-|Q1|2025|Installation and full operation of digital<br>audio recording in court proceedings.|
|185|C3.4I7<br>Training of<br>judges|Target|Training of<br>judges|-|Number|0|110|Q4|2025|At least 110 (out of 130) judges have<br>completed trainings on the new Civil<br>Procedure Rules and other judicial skills.|
|186|C3.4I8<br>Upgrading the<br>infrastructure of<br>courts|Milestone|Extension of the<br>Famagusta<br>District Court|Project<br>management<br>team certifies<br>the completion<br>of the<br>construction.|-|-|-|Q4|2021|Completion of construction of the<br>extension to the Famagusta District Court<br>building to support the operation of new<br>courtrooms to try in addition to criminal<br>also civil cases.|
|187|C3.4R10<br>Improving the<br>legal and<br>institutional<br>framework for<br>fighting<br>corruption|Milestone|Entry into force<br>of the law<br>establishing the<br>Independent<br>Authority<br>against<br>Corruption|Provision of the<br>law indicating<br>the entry into<br>force of the law<br>and start of<br>operation of the<br>Independent<br>Authority<br>against<br>Corruption with<br>key|-|-|-|Q1|2022|The Independent Authority against<br>Corruption has been established on the<br>basis of the entry into force of the<br>corresponding law and is operational. <br>The Authority shall coordinate the efforts<br>of all bodies engaged in the fight against<br>and prevention of corruption and shall<br>supervise the timely implementation of<br>actions by the different competent<br>services.|

97

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||management<br>positions filled<br>and staff<br>recruited.|||||||
|188|C3.4R10<br>Improving the<br>legal and<br>institutional<br>framework for<br>fighting<br>corruption|Milestone|Entry into force<br>of the law on<br>Transparency in<br>Decision-<br>Making and<br>Related Matters|Provision of the<br>law indicating<br>the entry into<br>force of the law|-|-|-|Q4|2021|Entry into force of the law on<br>Transparency in Decision-Making and<br>Related Matters, including provisions to<br>prevent conflict of interest. The law shall<br>create the obligation to publicise contacts<br>made between persons interested in being<br>involved in public decision-making<br>procedures and officials or members of<br>the State service or of the wider public<br>sector or with employees for the benefit<br>of officials who, by their very position,<br>have competence or possibility of<br>initiating such procedures or formulating<br>their content or contributing or<br>determining the final outcome of such<br>procedures. Information on such a<br>contact, as well as its content and<br>purposes, shall be officially recorded and<br>be publicly available.|
|189|C3.4R10<br>Improving the<br>legal and<br>institutional<br>framework for<br>fighting<br>corruption|Milestone|Entry into force<br>of the law to<br>protect whistle-<br>blowers|Provision  of<br>the law<br>indicating the<br>entry into force<br>of the law|-|-|-|Q4|2021|Entry into force of a law to protect<br>whistle-blowers reporting fraud and<br>corruption from internal sanctions. The<br>law shall include supplementary<br>provisions on the protection of persons<br>reporting acts of corruption both in the<br>public and the private sectors (whistle-<br>blowers, persons not involved in the<br>acts), further to the protection already|

98

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||provided for in the Protection of<br>Witnesses Law 95(I)/2001. The law shall<br>also provide measures of leniency for<br>those who are involved in acts of<br>corruption, but voluntarily report to the<br>police and/or offer cooperation with the<br>authorities resulting in the full<br>investigation and prosecution of the case.|

99

**H.3.** **Description of the reforms and investments for the loan**

Investment 9 (C3.4I9): Aid Scheme for the private and public sector for certification with ISO 37001
(Anti Bribery)

The objective of the investment is to contribute to the fight against corruption by introducing to the
private and public sector the accreditation ISO 37001, which shall help in increasing transparency,
stamping out bribes and creating an ethical business culture.

The investment shall consist of grant support to the private and public sector, including local
governments, for consulting services and certification against bribery in accordance with the standard
ISO 37001.

The implementation of the investment shall be completed by 31 December 2025.

100

**H.4.** **Milestones, targets, indicators, and timetable for monitoring and implementation for the loan**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|190|C3.4I9<br>Aid Scheme<br>for the<br>private and<br>public sector<br>for<br>certification<br>with ISO<br>37001 (Anti<br>Bribery)|Target|ISO 37001 anti-<br>bribery<br>management<br>systems|-|Number|0|120|Q4|2025|At least 120 organisations are ISO accredited<br>for the Standard “ISO 37001 ANTI-BRIBERY<br>MANAGEMENT SYSTEMS” due of the<br>support granted|

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**I.** **COMPONENT** **3.5:** **S** **AFEGUARDING** **F** **ISCAL AND** **F** **INANCIAL** **S** **TABILITY**

This component of the Cypriot recovery and resilience plan addresses the challenges of fiscal and
financial vulnerabilities, including macroeconomic imbalances related thereto. The aim is to
safeguard financial stability by reducing legacy risks in the banking sector, putting in place measures
against high private indebtedness, and improving supervision in the non-bank sector. To ensure fiscal
stability, Cyprus aims at combating tax evasion, tax avoidance and aggressive tax planning; and
providing policy makers with comprehensive data in order to design a fair tax system. The envisaged
measures are expected to make revenue collection more efficient and Cyprus’ tax system fairer,
reducing the spill-over effects from aggressive tax planning.

The component supports addressing the Country-Specific Recommendations on financial stability
and private indebtedness (Country-Specific Recommendations 2 and 5 of 2019), and on addressing
features of the tax system that facilitate aggressive tax planning by individuals and multinationals
(Country-Specific Recommendation 4 of 2020 and Country-Specific Recommendation 1 of 2019).

**I.1.** **Description of the reforms and investments for non-repayable financial support**

**Safeguarding financial stability**

Reform 1 (C3.5R1): Legal Framework for crisis management for credit institutions

The objective of the measure is to improve the resilience of the banking sector by introducing a
framework for a coherent and concrete procedure for supporting credit institutions facing financial
difficulties.

The reform shall consist in (i) reviewing and amending the national insolvency framework for credit
institutions to increase its effectiveness and efficiency, in line with best European practices; and (ii)
laying down a framework for precautionary recapitalisation of credit institutions and for government
stabilisation tools for the purpose of participating in the resolution of a credit institution.

The implementation of the reform shall be completed by 30 September 2023.

                                         Reform 2 (C3.5R2): Framework and Action Plan for addressing non performing loans

The objective of the measure is to address financial risks related to legacy non-performing loans in
the banking sector by continuing efforts to improve the asset quality of banks and strengthening the
working environment for servicing of loans.

The reform shall consist in (i) implementing an action plan to address the remaining stock of legacy
non-performing loans and (ii) adopting a package of three amending laws regarding credit acquiring
companies and servicers (placing of loan servicers under regulation and supervision by the Central
Bank; granting access for loan servicers and credit acquiring companies to the Land Registry; and
aligning notification requirements in case of purchase of a loan by a credit acquiring company). A
progress report on the action plan shall be prepared by 30 June 2023 and approved by the Council of
Ministers, tracking the reduction of non-performing loans in the banking sector towards the indicative
reference values of 6% gross and 3% net non-performing loans ratio [14] and proposing policy measures
where appropriate.

14 These reference values are based on the definition of non-performing loans as used in the “Monitoring Report on Risk
Reduction Indicators” (November 2020), available at https://www.consilium.europa.eu/media/ 46978/joint-riskreduction-monitoring-report-to-eg_november-2020_for-publication.pdf

102

The implementation of the reform shall be completed by 30 June 2023.

Reform 3 (C3.5R3): Strategy for addressing inadequacies of the property transaction system (title
deeds)

The objective of the reform is to address inefficiencies in the system of issuing and transferring title
deeds, which results in property rights not being defined, complicates foreclosure procedures and
hinders the liquidation of collateral.

The reform shall consist in: (i) examination of pending cases for the issuance of title deeds or rejection
of the cases, (ii) extension of the new planning and building permit policy, currently up to two
residential units, to four residential units in a plot, which shall reduce the time needed to issue building
and spatial permits, (iii) review of the Streets and Buildings Regulation Law to introduce the right
incentives for the supervising engineer to further discourage irregularities that would result in title
deeds not being issued, (iv) amendment of the Sale of Property (Specific Performance) Law, which
shall ensure in advance that the transfer of immovable property is executed as soon as the buyer fulfils
his/her contractual obligations.

The implementation of the reform shall be completed by 31 December 2023.

Reform 4 (C3.5R4): New legal framework and system of exchange of data and credit bureau

The objective of the measure is to fight high private indebtedness by improving the assessment of
credit risk for new lending through evolvement of the credit registry, to enable it to offer services
such as credit scoring in full conformity with data protection rules.

The reform shall consist in amending the existing system for exchange of credit data, under which a
private company owned by the Association of Cyprus Banks is the credit registry, so as to allow the
provision of credit scoring services. The main elements of the amendment shall be to alleviate the
legal uncertainty regarding the ownership of the system and the distinct role of the credit registry and
other products offered by ARTEMIS as a credit bureau, to ensure continuation of the duty to collect
data on credit facilities by credit institutions and other creditors (such as credit acquiring companies),
to provide data from the Insolvency Department, and to define the terms and conditions of access to
data and its protection.

The implementation of the reform shall be completed by 31 December 2024.

Reform 5 (C3.5R5): Action plan for the development of a liability monitoring register

The objective of the measure is to improve the ability of the authorities to design and implement
targeted policies to prevent and manage the stock of private debt. This shall be pursued by creating a
liabilities monitoring register covering the amounts of debts towards the public as well as towards
credit institutions and credit acquiring companies.

The reform shall consist in implementing an action plan that shall involve the design and development
of a credit liability register to generate reports for decision and policy making, including the
production of person-by-person liability reports.

The implementation of the reform shall be completed by 31 December 2024.

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Reform 6 (C3.5R6): Reinforcing and strengthening the insolvency framework

The objective of this reform is to strengthen the implementation of the insolvency framework,
promote the use of insolvency schemes and tools, and ensure full and effective functioning of the
Department of Insolvency.

The reform shall consist in (i) implementing the remaining measures and actions specified in the 2018
Action Plan that were not already implemented and (ii) setting-up digital systems necessary for
improving the work of the Department of Insolvency and which promote the use of the insolvency
tools. The Action Plan was approved by the Council of Ministers in 2018, and reflects the national
policy for the field of insolvency. This reform shall include actions such as digitalisation of systems
(enhancement of existing systems and introduction of new ones), training delivered to the staff of the
Department of Insolvency, implementation of a Customer Service line and a web portal for customers,
and full implementation of the regulatory framework for Insolvency Practitioners.

The implementation of the reform shall be completed by 30 June 2025.

Reform 7 (C3.5R7): Strategy for Combating Financial Illiteracy

The objective of the measure is to promote financial literacy. It aims at enhancing financial education
within the general population, improve financial decision making, correct wrong attitudes and biases,
support more informed and financially responsible citizens and ultimately, help improve debt
repayment discipline.

The reform shall consist in preparing a strategy for combating financial illiteracy by: (i) identifying
the issues of financial illiteracy (ii) reviewing the international literature on the topic, and (iii)
providing an action plan for implementation. The Strategy shall include concrete goals, measurable
objectives, specify the channels for promoting financial literacy and include specific actions (both
short-term and long terms measures) for implementation. The reform shall also include full
implementation of the short-term measures of the strategy.

The implementation of the reform shall be completed by 31 December 2023.

Reform 8 (C3.5R8): Enhancing supervision of Insurance and Pension Funds

The objective of the measure is to enhance the supervision of the insurance and pension funds.

The reform shall consist in (i) increasing the administrative capacity of the supervisory authorities,
(ii) preparing and implementing the necessary tools for ensuring compliance with the regulatory
frameworks conveyed to the European Insurance and Occupational Pensions Authority (EIOPA)
(such as the revised Institutions for Occupational Retirement Provision (IORP II) Directive) and (iii)
undertaking specific supervisory actions according to plans as conveyed to EIOPA and based on the
authorities supervisory review processes, for ensuring financial stability and for protecting the
interests of pension funds members and insurance policy holders.

The Department of the Registrar of Occupational Retirement Benefit Funds (RORBF) supervising
the pension sector, shall increase permanent staff by 13 persons. The Insurance Companies Control
Service (ICCS) supervising the insurance sector shall increase its permanent personnel by three

persons.

The implementation of the reform shall be completed by 31 March 2025.

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Investment 1 (C3.5I1): Enhancement of the Supervisory Function of Cyprus Securities and Exchange
Commission

The objective of the measure is to enhance the supervisory capacity of Cyprus Securities and

–
Exchange Commission (CySec) through digitalisation allowing for better supervision of
transactions.

The investment shall consist in developing an advanced digital system, based on cloud architecture,
covering the supervision needs of European Market Infrastructure Regulation (EMIR), the Securities
Financing Transactions Regulation (SFTR) and the Markets in Financial Instruments Regulation
(MiFIR). The new system shall support the following features: (i) connect to the European Securities
and Markets Authority (ESMA) hub; load and pre-process transaction data, (ii) aggregate and perform
queries on data to generate regulatory insights (iii) generate on-schedule and ad-hoc reports.

The implementation of the investment shall be completed by 31 December 2023.

**Safeguarding fiscal stability**

Reform 9 (C3.5R9): Improving tax collection and effectiveness of the Tax Department

The objective of the measure is to make tax collection more efficient and effective, through a higher
level of digitalisation and tax compliance, and improve customer service.

The reform shall consist in integrating different tax units, procedures and processes, so as to offer
single point of taxpayer service, legislative changes and implementing a new IT system and digitising
the Tax department. The latter shall include: (a) a single registration to the tax base and Taxisnet (for
electronic submission of Income Tax Returns by Individuals, Legal Persons and Employers); (b) an
integrated tax auditing process based on risk assessment; (c) an integrated refunds audit; (d) an
integrated and enhanced single point of service, including the direct payment of VAT and connecting
businesses to a server held within the Tax Department, without the use of specialised mechanisms;
(e) a process to issue single tax clearances; (f) possibility for immediate adjustments of the system to
accommodate any changes in the legislation and/or procedures and extension of secure interfaces
with other information systems; (g) data analysis capabilities and (h) scanning and electronic storage
of all taxpayer paper documents regarding the real estate (immovable property) and capital gains with
relevant security, integrity and confidentiality parameters. The newly acquired building for the
integrated Nicosia District Office and Large Taxpayers’ Office shall enhance the efforts of integrating
the district tax offices in the capital, from five different office-buildings at different locations deemed
technologically unsuitable previously, and allow the provision of taxpayer services from one single
location in Nicosia district. The legislative changes shall include: a recently introduced legislation to
implement the mandatory submission of tax returns by every natural person with income as defined
in Article 5 of the Income Tax Law, regardless of the threshold starting from the tax year 2020
(subject to exceptions).

The implementation of the reform shall be completed by 31 December 2025.

Reform 10 (C3.5R10): Addressing Aggressive Tax Planning

The overall objective of the measures under the reform is to increase the effectiveness, efficiency and
fairness of the tax system by combatting tax evasion and aggressive tax planning by Multinational
Enterprises.

The measure shall consist in three different reform sub-measures.

The first reform sub-measure shall consist in imposing a withholding tax on outbound payments of
interest, dividends and royalty payments and the introduction of a further corporate tax residency test
based on the incorporation of each entity. A withholding tax shall be imposed to jurisdictions in

105

Annex I of the EU list of non-cooperative jurisdictions on tax matters, as a first step through
enactment of the Law by 31 December 2021, providing for its entry into force by 31 December 2022.

The corporate tax residency test shall be additional to the management and control test. It shall be
enacted by 31 December 2021, providing for its entry into force by 31 December 2022. The first test
shall be the management and control and, in cases where a company is incorporated in Cyprus but its
management and control is done from another jurisdiction, it shall be considered as a Cyprus tax
resident and shall be taxed in accordance with the relevant provision of the Income Tax Law, provided
that the company is not a tax resident elsewhere (to avoid dual residency status).

A second reform sub-measure shall consist in introducing a withholding tax on outbound payments
of interest, dividends and royalty payments to low tax jurisdictions. In respect of interest and royalty
payments, the Cypriot authorities may explore instead the approach of applying non-deductibility.
Such legislative change shall enter into force by 31 December 2024.

As a third reform sub-measure, Cyprus shall assess the effectiveness of the overall set of measures
related to aggressive tax planning, via an independent evaluation to be completed by 31 December
2024. This evaluation shall assess the Cyprus tax framework holistically including all measures
adopted by then. The evaluation shall lead to policy action to be undertaken by Cyprus to address any
shortcomings identified, including in the form of legislative changes, which shall enter into force by
30 June 2026.

The implementation of the reform shall be completed by 30 June 2026.

Investment 2 (C3.5I2): Modernisation of Customs and Electronic Payment System

The objective of the measure is to develop and implement the electronic systems envisaged under the
Union Customs Code. The measure is expected to simplify and expedite customs formalities and
reduce the administrative cost for all stakeholders and thus make revenue collection more efficient.

The investment shall consist in developing and putting into operation twelve systems, consisting in
three different types: (i) the Declaration Systems (such as Manifest, Automated Import, Transit,
Automated Export and Excise Movement Control System), which shall communicate with the
Operational Components, the Management Components and External Interfaces using the Integration
Layer; (ii) the Operational Systems, which shall consist of the Risk Analysis, Accounting, Audit,
Tariff, Customs Warehouse, Case Management, Surveillance and Quota and (iii) the Management
Systems, which shall consist of the Business Rule Management, Business Process Management,
Reference Data Management, Internal IAM and Reporting.

The implementation of the investment shall be completed by 31 December 2025.

106

**I.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|191|C3.5R1<br>Completing the<br>legal framework<br>for Crisis<br>Management for<br>Credit<br>Institutions|Milestone|Entry into<br>force of the<br>amendment of<br>the national<br>insolvency<br>framework for<br>credit<br>institutions,<br>and<br>introduction of<br>government<br>tools for<br>preservation of<br>financial<br>stability|Provision in<br>the laws<br>indicating their<br>entry into force<br>of the|-|-|-|Q3|2023|Entry into force of the following two<br>legislative packages:<br>(a) the 'Insolvency of Credit Institutions'<br>law which shall introduce flexibility and<br>necessary tools to competent authorities<br>for the effective liquidation of insolvent<br>credit institutions and (b) the Financial<br>Stability Law and Financial Support<br>under Resolution Law, which shall lay<br>the framework for government<br>intervention, in particular through<br>precautionary recapitalisation of a credit<br>institution and through government<br>stabilisation tools for the purpose of<br>participating in the resolution of an<br>institution.|
|192|C3.5R2<br>Framework and<br>Action Plan for<br>addressing NPLs|Milestone|Entry into<br>force of the<br>package of<br>amending laws<br>regarding<br>credit<br>acquiring<br>companies<br>(CAC) and<br>credit servicers<br>to improve the<br>working<br>environment<br>for non-|Provision in<br>the law<br>indicating the<br>entry into force<br>of the<br>respective laws|-|-|-|Q4|2021|Entry into force of the following three<br>laws: <br>(a) The Credit Facilities Purchase and<br>Related Matters (Amending) Law of<br>2021, which shall put non-performing<br>loan servicers under regulation and<br>supervision by the Central Bank; <br> (b) The Immovable Property (Transfer,<br>Registration and Valuation) (Amending)<br>Law of 2021, which shall give access for<br>non-performing loan servicers and credit<br>acquiring companies to the Land Registry <br>(c) Evidence (Amending) Law 2020,<br>which shall align notification|

107

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||performing<br>loans<br>management|||||||requirements in case of purchase of a loan<br>by a credit acquiring company.|
|193|C3.5R3<br>Strategy for<br>addressing<br>inadequacies of<br>the property<br>transaction<br>system (title<br>deeds)|Target|Reduction of<br>backlog of<br>cases for<br>issuance of<br>title deed either<br>by issuing title<br>deeds or by<br>rejecting the<br>case|-|% <br>(Percentage)|0|80|Q2|2023|Reduction of backlog of pending cases<br>for issuance of title deeds either by<br>issuing title deeds (the legal document<br>constituting the evidence of a right to the<br>ownership of a property) or by rejecting<br>the case. Title deeds for 1 050<br>developments are pending for assesment,<br>corresponding to 20 000 title deeds. Of<br>this total of 20 000 pending title deeds,<br>80% shall be resolved resulting either to<br>the issuance of title deeds or to a rejection<br>of the case.|
|194|C3.5R3<br>Strategy for<br>addressing<br>inadequacies of<br>the property<br>transaction<br>system (title<br>deeds)|Milestone|Extension of<br>the New<br>Planning and<br>Building<br>Permit Policy|Decree issued<br>by the Minister<br>of Interior|-|-|-|Q4|2022|Extension of the New Planning and<br>Building Permit Policy for up to four<br>residential units in residential plots. The<br>Policy provides the possibility to submit<br>applications electronically and introduces<br>fixed deadlines to grant planning and<br>building permits (ten to twenty days).|
|195|C3.5R3<br>Strategy for<br>addressing<br>inadequacies of<br>the property<br>transaction<br>system (title<br>deeds)|Milestone|Entry into<br>force of the<br>amendment of<br>the Sale of<br>Property<br>(Specific<br>Performance)<br>Law|Provision in<br>the law<br>indicating the<br>entry into force<br>of the amended<br>Sale of<br>Property<br>(Specific|-|-|-|Q4|2022|Entry into force of the amended Sale of<br>Property (Specific Performance) Law to<br>safeguard the buyers interests in advance.<br>The amendment shall allow for transfer<br>of Title Deeds, under full safety and legal<br>certainty, while minimizing operational<br>costs and delays through checks at a<br>preliminary stage to identify specific<br>obstacles to the transfer before the|

108

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||Performance)<br>Law||||||payment of the purchase price. The aim is<br>to create a mechanism to safeguard the<br>interests of the buyers of immovable<br>property and ensure in advance that the<br>transfer of immovable property shall be<br>executed as soon as the buyer fulfils<br>his/her contractual obligations.|
|196|C3.5R3<br>Strategy for<br>addressing<br>inadequacies of<br>the property<br>transaction<br>system (title<br>deeds)|Milestone|Review of the<br>Streets and<br>Building<br>Regulation|Provision in<br>the law<br>indicating the<br>entry into force<br>of the amended<br>Streets and<br>Building<br>Regulation|-|-|-|Q4|2023|Entry into force of the law amending the<br>Streets and Building Regulation which<br>shall introduce the right incentives for the<br>supervising engineer to (i) oversee the<br>project development in accordance with<br>the permit issued, to further discourage<br>irregularities that would result in title<br>deeds not being issued and (ii) submit to<br>the competent authority a certificate<br>confirming the completion of work in line<br>with the permit issued.|
|197|C3.5R4<br>New legal<br>framework and<br>system of<br>exchange of data<br>and credit bureau|Milestone|Entry into<br>force of the<br>framework and<br>system of<br>exchange of<br>data legislation|Provision in<br>the legislation<br>indicating the<br>entry into force<br>of the<br>legislation|-|-|-|Q1|2023|Entry into force of the legislation on the<br>framework and system of exchange of<br>data by ARTEMIS credit bureau, which<br>shall eliminate impediments in the current<br>framework so as to allow it to provide<br>credit scoring services. The main<br>elements of the amendment shall be to<br>broaden the supervisory role of the<br>Central Bank of Cyprus, to maintain a<br>duty to collect data for credit facilities by<br>credit institutions and other creditors, to<br>provide Insolvency Department data, and<br>to define the terms and conditions of<br>access to data and its protection.|

109

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|198|C3.5R4<br>New legal<br>framework and<br>system of<br>exchange of data<br>and credit bureau|Milestone|Upgraded<br>digital system<br>of exchange of<br>data and credit<br>bureau|Successful<br>Production of<br>Credit Scores|-|-|-|Q4|2024|Full implementation and entry into<br>service of the upgraded digital system of<br>exchange of data by ARTEMIS credit<br>bureau in accordance with the legislation<br>on the framework and system of<br>exchange of data, and start of provision<br>of credit scores services.|
|199|C3.5R5<br>Action plan for<br>the development<br>of a liability<br>monitoring<br>register|Milestone|Action Plan for<br>the<br>development<br>of a liability<br>monitoring<br>register|Approval of<br>the Action Plan<br>by the Council<br>of Ministers|-|-|-|Q4|2022|The Action Plan shall put forward the<br>necessary steps for introducing the<br>liability monitor register that shall: <br>- utilise an electronic database, collecting<br>data on liabilities from various public and<br>private creditors, such as the credit<br>registry under reform C3.5R4. <br>- enable the design and implementation of<br>targeted policies for preventing and<br>managing private indebtedness.|
|200|C3.5R5<br>Action plan for<br>the development<br>of a liability<br>monitoring<br>register|Milestone|Action plan for<br>the<br>development<br>of a liability<br>monitoring<br>register|Confirmation<br>by the Council<br>of Ministers on<br>the<br>implementatio<br>n of the Action<br>plan|-|-|-|Q4|2024|Full implementation of Action Plan for<br>the development of a liability monitoring<br>register that shall<br>- utilise an electronic database, collecting<br>data on liabilities from various public and<br>private creditors, such as the credit<br>registry under reform C3.5R4 <br>- enable the design and implementation of<br>targeted policies for preventing and<br>managing private indebtedness.|
|201|C3.5R6<br>Reinforcing and<br>strengthening the<br>insolvency<br>framework|Milestone|Full<br>implementatio<br>n and full<br>operation of<br>the legal and|Appointment<br>of staff<br>confirmed by<br>the Official<br>Gazette.|-|-|-|Q4|2022|Full implementation and full operation of<br>the legal and institutional framework on<br>insolvency through: (a) appointment of<br>staff for all levels of the organisational<br>structure of the Department of|

110

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||institutional<br>framework for<br>insolvency|Council of<br>Ministers’<br>approval of the<br>Progress<br>Report||||||Insolvency, and delivery of trainings for<br>the personnel, (b) establishment of a<br>communication plan for promoting<br>insolvency proceedings, (c) approval of a<br>customer service line, (d) establishment<br>of a framework for continuous<br>professional development for insolvency<br>Practitioners.|
|202|C3.5R6<br>Reinforcing and<br>strengthening the<br>insolvency<br>framework|Milestone|Operation of<br>all digital<br>systems<br>developed for<br>the Department<br>of Insolvency|Approval of<br>the Progress<br>Report by the<br>Council of<br>Ministers|-|-|-|Q2|2025|The new digital systems shall increase the<br>relevance and efficiency of the existing<br>operational and technical systems of the<br>Department of Insolvency.|
|203|C3.5R7<br>Strategy for<br>Combating<br>Financial<br>Illiteracy|Milestone|Strategy for<br>Combating<br>Financial<br>Illiteracy|Approval of<br>the Strategy for<br>Combating<br>Financial<br>Illiteracy by<br>the Council of<br>Ministers|-|-|-|Q4|2023|The Strategy for Combating Financial<br>Illiteracy shall include concrete goals,<br>measurable objectives, specify the<br>channels for promoting financial literacy<br>and include specific actions for<br>implementation (both short-term and long<br>terms measures). The reform shall also<br>include full implementation of the short-<br>term measures of the strategy.|
|204|C3.5R8<br>Enhancing<br>supervision of<br>Insurance and<br>Pension Funds|Target|Strengthening<br>the human<br>resources of<br>the Registrar of<br>Occupational<br>Retirement<br>Benefits Fund<br>(RORBF) and<br>the Insurance|-|Number|0|16|Q1|2025|Increase staff by thirteen employees for<br>the Registrar of Occupational Retirement<br>Benefit Funds (RORBF) and by three<br>employees for the Insurance Companies<br>Control Service (ICCS). This shall be a<br>permanent increase in staff.|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||Companies<br>Control<br>Service (ICCS)||||||||
|205|C3.5R8<br>Enhancing<br>supervision of<br>Insurance and<br>Pension Funds|Milestone|Supervisory<br>tools including<br>data collection<br>and analysis<br>tool|Support tools<br>for enhancing<br>the supervision<br>of pension<br>funds and<br>insurance<br>companies|-|-|-|Q4|2023|Full implementation of tools (such as<br>procedures, checklists, fitness and<br>propriety applications) necessary for<br>compliance with new legislation<br>(providing for the establishment,<br>activities and supervision of Institutions<br>for Occupational Retirement Benefits<br>Law of 2020 -L 10(I)/2020 and the<br>legislation of the Insurance and<br>Reinsurance Business and Other Related<br>Issues Law of 2016(Ν.38(Ι)/2016.|
|206|C3.5I1<br>Enhancement of<br>the Supervisory<br>Function of the<br>Cyprus Securities<br>and Exchange<br>Commission|Milestone|Digital system<br>for supervision<br>of transactions<br>for the Cyprus<br>Securities and<br>Exchange<br>Commission|Project<br>management<br>committee<br>verifies<br>acceptance of<br>deliverables in<br>due time; and<br>quality and<br>standards as<br>specified in<br>tender<br>documents<br>|-|-|-|Q4|2023|Full implementation of a new digital<br>system of supervision of transactions.<br>The new digital system shall have the<br>following features: <br>- Loading and pre-processing of<br>Transaction data. <br>- Aggregations and queries on data to<br>generate regulatory insights. <br>- Generation of on-schedule and ad-hoc<br>reports.|
|207a|C3.5R9<br>Improving tax<br>collection and<br>effectiveness of|Milestone|Operation of<br>VAT Services<br>within an<br>Integrated Tax|Project Board<br>Approval of<br>the Project<br>Deliverables<br>for completion,|-|-|-|Q1|2022|The Cyprus Tax Department (CTD) shall<br>put into operation an Integrated Tax<br>Administration System (ITAS) that shall<br>support the tax administration<br>functionalities and processes. The|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||the Tax<br>Department||Administration<br>System (ITAS)|installation and<br>operation of a<br>new integrated<br>VAT System||||||functionalities related to the VAT<br>Services shall be completed and<br>operational within this system.|
|207b|C3.5R9<br>Improving tax<br>collection and<br>effectiveness of<br>the Tax<br>Department|Milestone|Purchase of the<br>new building<br>for the<br>integrated<br>Nicosia<br>District Office<br>and Large<br>Taxpayers’<br>Office|Completion of<br>the purchase<br>and start of<br>operations||||Q3|2023|The new building for the integrated<br>Nicosia District Office and Large<br>Taxpayers’ Office has been purchased.|
|208|C3.5R9<br>Improving tax<br>collection and<br>effectiveness of<br>the Tax<br>Department|Milestone|Integration of<br>operations of<br>the direct tax<br>administration<br>department<br>within the<br>ITAS|Project Board<br>approval of the<br>System<br>Deliverables<br>for completion<br>installation and<br>operation of<br>ITAS for direct<br>taxes and go-<br>live acceptance<br>report|-|-|-|Q2|2024|The tax administration services related to<br>direct taxes of natural and legal persons<br>(in addition to VAT) shall be operational<br>within the ITAS.|
|209|C3.5R10<br>Addressing<br>Aggressive Tax<br>Planning|Milestone|Entry into<br>force of the<br>law to tackle<br>aggressive tax<br>planning|Provision in<br>the law<br>indicating the<br>entry into force<br>of the law|-|-|-|Q4|2022|Entry into force of a law to tackle<br>aggressive tax planning by (a) imposing a<br>withholding tax on interest, dividends and<br>royalty payments to jurisdictions included<br>in Annex I of the Council conclusions on<br>the revised EU list of non-cooperative<br>jurisdictions for tax purposes and (b)<br>introduction of a further corporate tax|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||residency test based on the incorporation<br>of each entity.|
|210|C3.5R10<br>Addressing<br>Aggressive Tax<br>Planning|Milestone|Entry into<br>force of the<br>law to tackle<br>aggressive tax<br>planning via<br>payments to<br>low tax<br>jurisdictions|Provision in<br>the law<br>indicating the<br>entry into force<br>of the law|-|-|-|Q4|2024|Entry into force of a law to tackle<br>aggressive tax planning via payments to<br>low tax jurisdictions by introducing a<br>withholding tax on interest, dividends,<br>and royalty payments to low tax<br>jurisdictions. In respect of interest and<br>royalty payments, the Cypriot authorities<br>may explore instead the approach of<br>applying non-deductibility.|
|211|C3.5R10<br>Addressing<br>Aggressive Tax<br>Planning|Milestone|Entry into<br>force of<br>legislative<br>changes<br>addressing the<br>findings of an<br>independent<br>evaluation on<br>the<br>effectiveness<br>of measures<br>related to<br>aggressive tax<br>planning|Provision in<br>the law<br>indicating the<br>entry into force<br>of the law|-|-|-|Q2|2026|Cyprus shall assess the effectiveness of<br>the overall set of measures related to<br>aggressive tax planning, via an<br>independent evaluation to be completed<br>by 31 December 2024. This evaluation<br>shall assess the Cyprus tax framework<br>holistically including all measures<br>adopted by then. The evaluation shall<br>lead to policy action to be undertaken by<br>Cyprus including in the form of<br>legislative changes to address any<br>shortcomings identified.|
|212|C3.5I2<br>Modernisation of<br>Customs and<br>Electronic<br>Payment System|Target|Putting into<br>operation the<br>information<br>systems– <br>envisaged<br>under the<br>Union|-|Number|0|2|Q4|2023|At least two of the following import-<br>related information systems have been<br>completed, installed and put into<br>operation:<br>1. Automated Export System <br>2. New Computerised Transit System <br>3. EU Single Window|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and<br>target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||||Customs Code<br>(UCC)|||||||4. Union Customs Code <br>5. Guarantee Management<br>6. Union Customs Code <br>7. SURVEILLANCE 3 <br>8. Union Customs Code - Import Control<br>System 2 <br>9. Import Applications under the Union<br>Customs Code <br>10. Customs Union Performance– <br>Management Information System <br>11. Union Customs Code Proof of Union<br>Status <br>12. Uniform User Management and<br>Digital Signature|
|213|C3.5I2<br>Modernisation of<br>Customs and<br>Electronic<br>Payment System|Target|Putting into<br>operation of<br>the information<br>systems<br>envisaged<br>under the UCC|-|Number|2|12|Q4|2025|The 12 information systems have been<br>completed, installed and put into<br>operation|

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**J.** **COMPONENT** **4.1:** **Upgrade infrastructure for connectivity**

This component of the Cypriot recovery and resilience plan contributes to addressing infrastructure
challenges in the area of data connectivity, in particular in rural areas, with a view to narrowing the
rural-urban divide, as well as differences along gender, age, income and education.

The objective of the component is to enhance access to communication infrastructure for all citizens,
thus bridging the digital divide and supporting an inclusive digital transformation.

The component addresses the country-specific recommendation on investment in the digital transition
and the digitalisation (Country-Specific Recommendation 4 of 2019 and Country-Specific
Recommendation 3 of 2020).

It is expected that no measure in this component does significant harm to environmental objectives
within the meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of
the measures and the mitigating steps set out in the recovery and resilience plan in accordance with
the DNSH Technical Guidance (2021/C58/01).

**J.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C4.1R1): Empower the National Regulatory Authority (OCECPR)

The objective of the measure is to facilitate and accelerate investments in Very High Capacity
Networks (VHCN) in underserved areas by providing stakeholders with the relevant information to
improve transparency and enhance the incentives for market operators to invest faster in VHCN,
thereby increasing connectivity in Cyprus.

The reform consists in providing the proper tools, through the adoption of secondary legislation, to
the Office of the Commissioner of Electronic Communications and Postal Regulation (OCECPR) to
launch a survey in order to collect geographical data on electronic communication networks. The data
shall then be accessible through a web portal providing detailed information regarding network rollout in areas where it is needed. This is expected to help bridge the gap with private investments for
VHCN.

The implementation of the reform shall be completed by 31 December 2024.

Reform 2 (C4.1R2): Empower the National Broadband Competence Office (DEC of the DMRIDP)

The objective of the measure is to facilitate the build-up of VHCN infrastructure by simplifying the
necessary administrative procedures for its deployment while implementing the Connectivity
Toolbox Recommendation (set of best practices for reducing the cost of deploying electronic
communications networks and for efficient access to 5G radio spectrum).

The reform consists in identifying the administrative bottlenecks and barriers to the rapid deployment
of VHCN and possible measures to address them. It shall be followed-up by the entry into force of
legislation to effectively address such bottlenecks and barriers.

The implementation of the reform shall be completed by 30 June 2024.

                             Investment 1 (C4.1I1): Expansion of Very High Capacity Networks in underserved areas

The objective of the measure is to improve connectivity with VHCN (such as fibre and 5G), by
supporting the build-up of VHCN in areas of no private interest and thereby addressing territorial
disparities of broadband availability.

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The investment consists in organising public tenders through an open tender procedure addressed to
telecom operators to select contractors that shall undertake the design, construction and operation of
the network, as well as part of the financing. The geographical territory of the Republic of Cyprus
which is under the control of the Government of Cyprus is expected to be divided into three lots. The
maximum amount of public financial contribution shall be set separately for each lot, and award
criteria are expected to include the requested public support as well as the price offered to end-users
and to other retail operators. Wholesale obligations shall be imposed to the contractors.

The implementation of the investment shall be completed by 31 December 2025.

“                           - ”
Investment 2 (C4.1I2): Upgrade internet connection to be Gigabit ready and promote connectivity
take-up

The objectives of the measure are to encourage the digital transition through support of widespread
take-up of VHCN.

The investment consists in the implementation of a demand subsidy (voucher) scheme, addressed
exclusively to physical persons (i.e. excluding enterprises), encouraging them to proceed with the
upgrade of their internet connection by subscribing to a Gigabit ready internet service. It applies to
single tenant units, as well as apartments in multi-dwelling buildings with no connection capable of
supporting very high capacity services. The voucher value per premise shall be fixed. End-users shall
be able to select a service provider and the technology of their choice to upgrade the connection. After

                                                  the upgrade of the connection, installers shall upload in the IT system the “Gigabit ready” certificate
for the household, along with the acceptance form signed by the owner/tenant who issued the voucher,
thus triggering redemption of the voucher.

The implementation of the investment shall be completed by 30 June 2025.

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**J.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|214|C4.1R1<br>Empower the<br>National<br>Regulatory<br>Authority<br>(OCECPR)|Milestone|Launch of the<br>geographical<br>survey and<br>entry into<br>force of<br>secondary<br>legislation|Entry into<br>force of the<br>secondary<br>legislation and<br>launch of the<br>survey|-|-|-|Q1|2022|The secondary legislation shall enter into force<br>and cover the main aspects related to the survey<br>such as the type, the degree of analysis and the<br>form of the required information, as well as the<br>persons from whom the required information is<br>requested.<br>Launch of the geographical survey of the reach<br>of electronic networks capable of delivering<br>broadband networks and physical infrastructures<br>based on Article 22 of the European Electronic<br>Communications Code.|
|215|C4.1R1<br>Empower the<br>National<br>Regulatory<br>Authority<br>(OCECPR)|Milestone|The web<br>portal on<br>broadband and<br>infrastructure<br>mapping is<br>operational<br>and accessible<br>to the target<br>audience|The web<br>portal on<br>broadband and<br>infrastructure<br>mapping is<br>accessible|-|-|-|Q4|2024|The web portal on broadband and infrastructure<br>mapping is completed, tested, operational and<br>accessible to the target audience (such as the<br>Office of the Commissioner for Electronic<br>Communications and Postal Regulation, Public<br>Authorities, Electronic Communication<br>Network Operators and end-users).|
|216|C4.1R2<br>Empower the<br>National<br>Broadband<br>Competence<br>Office (DEC<br>of the<br>DMRIDP)|Milestone|Entry into<br>force of the<br>administrative<br>acts for very<br>high capacity<br>networks’<br>deployment|Provision in<br>the<br>administrative<br>acts indicating<br>the entry into<br>force of the<br>respective acts|-|-|-|Q2|2024|Entry into force of the administrative acts that<br>shall effectively streamline and reduce<br>administrative barriers (such as shortening<br>permit granting procedures and lowering fees as<br>well as facilitating access to physical<br>infrastructure) for the deployment of very high<br>capacity networks in line with the Connectivity<br>Toolbox Recommendation (including a set of<br>best practices for reducing the cost of deploying|

118

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||electronic communications networks and for<br>efficient access to 5G radio spectrum).|
|217|C4.1I1<br>Expansion of<br>Very High<br>Capacity<br>Networks in<br>underserved<br>areas|Milestone|Start of very<br>high capacity<br>networks’<br>deployment in<br>underserved<br>areas|Signed<br>contracts with<br>contractors to<br>deploy very<br>high capacity<br>networks in<br>areas of no<br>interest to<br>private very<br>high capacity<br>network<br>investors|-|-|-|Q4|2023|Contracts have been signed with contractors,<br>which shall have been selected through an open<br>tender procedure, to deploy very high capacity<br>networks (in particular, fixed and mobile (5G)<br>networks offering a download speed of at least<br>100Mbps, which shall be readily upgradable to<br>Gigabit for fixed access) in areas of no interest<br>to private very high capacity network investors.|
|218|C4.1I1<br>Expansion of<br>Very High<br>Capacity<br>Networks in<br>underserved<br>areas|Target|Expansion of<br>very high<br>capacity<br>networks’<br>deployment in<br>underserved<br>areas|-|Number|0|10 000|Q4|2024|At least 10 000 premises in areas of no interest<br>to private very high capacity network investors<br>are covered by very high capacity networks with<br>fixed or mobile (5G) network, offering a<br>download speed of at least 100Mbps, which<br>shall be readily upgradable to Gigabit (for fixed<br>networks).|
|219|C4.1I1<br>Expansion of<br>Very High<br>Capacity<br>Networks in<br>underserved<br>areas|Target|Completion of<br>very high<br>capacity<br>networks’<br>deployment in<br>underserved<br>areas|-|Number|10 000|44 000|Q4|2025|At least 44 000 premises in areas of no interest<br>to private very high capacity network investors<br>are covered by very high capacity networks with<br>fixed or mobile (5G) network, offering a<br>download speed of at least 100Mbps, which<br>shall be readily upgradable to Gigabit (for fixed<br>networks).|

119

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|220|C4.1I2<br>Upgrade<br>internet<br>connection to<br>be “Gigabit-<br>ready” and<br>promote<br>connectivity<br>take-up|Target|Expansion of<br>Gigabit-ready<br>internet<br>connection<br>take-up by<br>households|-|Number|0|24 300|Q2|2023|Internet connection has been upgraded to be<br>able to support provision of Gigabit<br>connectivity in at least 24 300 homes.|
|221|C4.1I2<br>Upgrade<br>internet<br>connection to<br>be “Gigabit-<br>ready” and<br>promote<br>connectivity<br>take-up|Target|Completion of<br>Gigabit-ready<br>internet<br>connection<br>take-up by<br>households|-|Number|24 300|82 000|Q2|2025|Internet connection has been upgraded to be<br>able to support provision of gigabit connectivity<br>in at least 82 000 homes.|

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**K.** **COMPONENT** **4.2:** **P** **ROMOTE E** **-** **GOVERNMENT**

This component of the Cypriot recovery and resilience plancontributes to accelerating the digital
transformation of Cyprus through the digitalisation of government services enhancing the efficiency
and the provision of online, secure and prompt services to citizens, in a user friendly, efficient and
effective way. This is expected to facilitate the interaction between citizens and the public services,
without the need for physical presence.

The objective of the component is to build a secured, integrated and modern digital architecture to
achieve the transformation to a digital government.

The component addresses the country-specific recommendation on investment in the digital transition
and the digitalisation (Country-Specific Recommendation 4 of 2019 and Country-Specific
Recommendation 3 of 2020).

**K.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C4.2R1): Digital Services Factory (DSF)

The objective of the measure is to build a new Service Delivery Model for the development of endto-end quality digital services to the public, in a user-friendly, efficient and effective way that shall
ultimately facilitate the interaction with public services, without the need for physical presence.

The reform shall consist in designing and developing this new delivery model, the DSF. First, the
project shall (i) set up the core team of the DSF (comprised of experts of different specialties with the
appropriate skills and qualifications), (ii) define the standards and procedures for the development of
digital services, and (iii) build and develop a number of digital services. Second, using the
methodologies defined, digital services shall be developed in an industrialised fashion, in cooperation
with the private sector. Services shall be provided securely to citizens through a single government
website portal Gov.Cy. Single sign-on and digital identity are expected to be the basic key enablers
for the secure provision of eServices. Furthermore, existing common mechanisms like ‘ePayment’
offering several methods of payments (such as visa, instant payments and direct banking) and
‘notification’ (such as SMS, email) are expected to be utilised.

The implementation of the reform shall be completed by 30 June 2026.

Reform 2 (C4.2R2): Definition and implementation of a new cloud policy with regard to government
IT systems and services

The objective of the measure is to elaborate the cloud policy of the government, notably the data
classification, data residency, the hosting and operation of the government IT systems either in a
public cloud or in a government private cloud (G-Cloud) environment.

The reform shall consist in setting up the G-Cloud to host the IT systems and digital services of certain
government departments / ministries (such as the registrar of companies system, the customs system
and the tax department system). Two local data centres shall be acquired through rental, while
consultancy services as well as training shall be acquired for the development of the G-Cloud. A
tender for the development and operation of the G-Cloud environment is also expected to be issued.

The implementation of the reform shall be completed by 31 December 2025.

Reform 3 (C4.2R3): Police procedures digitalisation (“Digipol”)

The objective of the measure is to eliminate the use of paper procedures and physical presence of the
citizens by moving to digitalised procedures for the Cyprus Police Force. This is expected to be
beneficial for both citizens and police officers as procedures shall be simplified and efficient.

121

The reform shall consist in the creation of a new platform (Digipol) of demands for police procedures
and services for citizens to achieve remote communications. Both citizens and police officers shall
make use of it. To maximise the uptake, trainings (such as online courses, videos, step-by-step guides)
for police officers as well as for citizens shall be organised to help transitioning to online services.

The implementation of the reform shall be completed by 30 September 2025.

Reform 4 (C4.2R4): Setting up the beneficial ownership registry

The objective of the measure is to set up the register for the submission of the data of beneficial
owners of all corporate and other legal entities. Such registration shall improve corporate trust and
transparency in Cyprus by making it clear who ultimately owns and controls companies and other
legal entities.

The reform shall consist in setting up the register. Currently, an online platform has been developed
as an interim solution but its functionalities are limited. The reform shall result in a solution with all
necessary functionalities to support the maintenance of the register and management of relevant
information (such as sending out notifications for updating, enforcement of late filing fees, search
facilities with prescribed levels of access). This is expected to support the registration of the data of
beneficial owners of all corporate and other legal entities and achieve interconnection with the
beneficial ownership registers of other Member States.

The implementation of the reform shall be completed by 31 December 2023.

Investment 1 (C4.2I1): Digitalisation in various central government ministries/services

The objective of the measure is to digitalise key workflows in a number of ministries and central
government services, to improve efficiency in the delivery of government services, simplify
compliance with government regulations, strengthen citizen participation and trust in government,
and yield cost savings.

The investment shall consist in digitalisation in the following ministries, deputy Ministries or services
of the government: (i) Road Transport Department of the Ministry of Transport, Communication and
Works, (ii) Deputy Ministry of Shipping, (iii) Ministry of Foreign Affairs, (iv) Directorate General
Growth and (v) Department of Town Planning and Housing of the Ministry of Interior (for
Architectural Heritage). Digitalisation of the Directorate General Growth shall include development
of a transitory repository system and of a final dedicated Monitoring Information System for
recording and storing the relevant data related to the implementation of the recovery and resilience
plan (in particular on the achievement of milestones and targets, data on final recipients, contractors,
subcontractors and beneficial owners).

The implementation of the investment shall be completed by 31 December 2025.

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Investment 2 (C4.2I2): Digitalisation of the Cyprus Ports Authority

The objective of the measure is to digitalise key processes in the Cyprus Ports Authority (CPA) to
improve their efficiency and effectiveness, including communications between vessels and the
relevant authorities and improvements to monitoring vessel traffic in Cyprus waters. The latter is to
ensure the safe navigation of vessels, reduce the risk of environmental damages due to spills from
accidents and reduce vessel emissions by plotting more efficient routes.

The investment shall consist of (i) several upgrades to the CPA’s network infrastructure, hardware
and software, and server capacity; (ii) incorporation of new HR Management Systems to automate
procedures; (iii) overhaul of the existing Port Community System to increase the efficiency of the
maritime transport sector and to reduce administrative burdens; and (iv) installation of Vessel Traffic
Control Stations at the Ports of Larnaca and Vassiliko (in addition to the existing one in Limassol
port).

The implementation of the investment shall be completed by 31 December 2025.

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**K.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Timeline for<br>completion<br>(indicate the<br>quarter and<br>the year)|Col10|Description and clear definition of each<br>milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|224|C4.2R1<br>Digital Services<br>Factory|Milestone|Definition of the<br>Service Delivery<br>Model for the<br>Digital Services<br>Factory|Appointment<br>decision of the<br>Deputy<br>Minister of<br>Research,<br>Innovation and<br>Digital Policy<br>establishing the<br>team;<br>publication of<br>the standards<br>on the website<br>of the Deputy<br>Ministry|-|-|-|Q4|2022|The Service Delivery Model for the Digital<br>Services Factory has been defined so as to enable<br>the efficient provision of high-quality and user-<br>friendly digital services to the public. This shall<br>include: (a) the establishment of the core Digital<br>Services Factory team (including the procurement<br>of services of experts from the private sector), and<br>(b) definition of the standards and procedures for<br>the development of digital services.|
|225|C4.2R1<br>Digital Services<br>Factory|Target|Expansion of<br>delivery of<br>government<br>services online<br>through the<br>Digital Services<br>Factory|-|Number|0|20|Q4|2023|Digitalisation and delivery online of at least 20<br>previously non-digital services to the public<br>through the Digital Services Factory, using the<br>defined Service Delivery Model (under milestone<br>with a sequential number 224) and agile<br>methodologies.|
|226|C4.2R1<br>Digital Services<br>Factory|Target|Delivery online<br>of at least 70<br>previously non-<br>digital services to<br>the public<br>through the<br>Digital Services<br>Factory|-|Number|20|70|Q2|2026|Digitalisation and delivery online of at least 70<br>previously non-digital services to the public<br>through the Digital Services Factory, using the<br>defined Service Delivery Model (under milestone<br>with a sequential number 224) and agile<br>methodologies.|

124

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Timeline for<br>completion<br>(indicate the<br>quarter and<br>the year)|Col10|Description and clear definition of each<br>milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|227|C4.2R2<br>Definition and<br>implementation of<br>a new cloud<br>policy with regard<br>to government IT<br>systems and<br>services|Milestone|The government<br>cloud (G-cloud)<br>is operational|Services<br>migrated to G-<br>cloud|-|-|-|Q4|2024|G-cloud is operational, providing cloud services<br>for data storage to at least the Registrar of<br>Companies, the Digital Services Factory, and the<br>customs system. These three services have been<br>migrated to the G-cloud and are no longer using<br>the old IT system.|
|228|C4.2R2<br>Definition and<br>implementation of<br>a new cloud<br>policy with regard<br>to government IT<br>systems and<br>services|Target|The government<br>cloud (G-cloud)<br>in two data<br>centres is<br>operational and<br>offering cloud<br>services|-|Number|0|2|Q4|2025|G-cloud in two new data centres shall be fully<br>operational, including the premises, hardware and<br>software, and offer cloud services to governmental<br>IT systems.|

125

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Timeline for<br>completion<br>(indicate the<br>quarter and<br>the year)|Col10|Description and clear definition of each<br>milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|229|C4.2R3<br>Police Procedures<br>digitalisation<br>Digipol|Milestone|Digipol<br>prototype<br>operational|Declaration by<br>Cyprus Police<br>confirming that<br>the prototype<br>platform<br>(Digipol) is<br>operational|-|-|-|Q2|2023|The prototype platform (Digipol) is operational.<br>Police officers shall be the users and have access to<br>the prototype Digipol for familiarity and training<br>purposes.|
|230|C4.2R3<br>Police Procedures<br>digitalisation<br>Digipol|Target|Citizens use<br>Digipol|-|Number|0|500|Q3|2025|Digipol shall be accessible online through the<br>Cyprus Police ICT infrastructure. At least 500<br>citizens have used one or more of the services<br>available on the Digipol platform for citizens.|
|231|C4.2R4<br>Setting up the<br>beneficial<br>ownership<br>registry|Milestone|Beneficial<br>ownership<br>registry available<br>for use|Beneficial<br>ownership<br>registry<br>publicly<br>available online<br>at national and<br>European Level|-|-|-|Q4|2023|The beneficial ownership registry shall be<br>deployed and become available for use at national<br>level and European level, enabling users to check<br>the ultimate beneficial ownership information of<br>legal entities and to achieve interconnection of the<br>beneficiary ownership registers with other Member<br>States.|
|232|C4.2I1<br>Digitalisation in<br>various Central<br>Government<br>Ministries -<br>Services|Milestone|Repository<br>system for audit<br>and control:<br>information for<br>monitoring<br>implementation<br>of RRF|An audit report<br>confirming<br>repository<br>system<br>functionalities|-|-|-|Q1|2022|A repository system for monitoring the<br>implementation of the RRF shall be in place and<br>operational. The system shall include, as a<br>minimum, the following functionalities:<br>(1) collection of data and monitoring of the<br>achievement of milestones and targets; (2) collect,<br>store and ensure access to the data required by<br>Article 22(2)(d) (i) to (iii) of Regulation (EU)<br>2021/241.|

126

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Timeline for<br>completion<br>(indicate the<br>quarter and<br>the year)|Col10|Description and clear definition of each<br>milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|233|C4.2I1<br>Digitalisation in<br>various Central<br>Government<br>Ministries -<br>Services|Target|Start of the<br>digital upgrade<br>of a number of<br>central<br>government<br>ministries and<br>departments|-|Number|0|4|Q1|2022|The contracts with providers selected through<br>public procurement procedures have been signed<br>to digitalise/digitally upgrade at least four of the<br>following central government<br>ministries/departments: <br>1. Road Transport Department of the Ministry of<br>Transport, Communication and Works, <br>2. Deputy Ministry of Shipping. <br>3. Ministry of Foreign Affairs <br>4. Directorate General Growth <br>5. Department of Town Planning and Housing of<br>the Ministry of Interior (for Architectural<br>Heritage).|
|234|C4.2I1<br>Digitalisation in<br>various Central<br>Government<br>Ministries -<br>Services|Target|Advancement of<br>the digital<br>upgrade of a<br>number of<br>central<br>government<br>ministries and<br>departments|-|Number|0|2|Q4|2024|Development completed and systems put into<br>operation for two government<br>ministries/departments from the list in target with<br>sequential number 233.|
|235|C4.2I1<br>Digitalisation in<br>various Central<br>Government<br>Ministries -<br>Services|Target|Finalisation of<br>the digital<br>upgrade of a<br>number of<br>central<br>government<br>ministries and<br>departments|-|Number|2|5|Q4|2025|Development completed and systems put in<br>operation for all five government<br>ministries/departments from the list in target with<br>sequential number 233.|

127

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Timeline for<br>completion<br>(indicate the<br>quarter and<br>the year)|Col10|Description and clear definition of each<br>milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|236|C4.2I2<br>Digitalisation of<br>the Cyprus Ports<br>Authority|Target|Start of the<br>digital upgrade<br>of the Cyprus<br>Ports Authority|-|Number|0|4|Q2|2023|The contracts with providers selected through a<br>public procurement procedure have been signed to<br>develop/upgrade at least four of the following<br>seven systems for the Cyprus Ports Authority: <br>1. Upgrade of the Port Community System; <br>2. Installation of VTS Station; <br>3. Digitisation of CPA archives; <br>4. Upgrade of IT infrastructure (such as network,<br>switches); <br>5. Update IS systems; <br>6. Installation of an HR Management System; <br>7. Upgrade CPA Servers; <br> <br>and contracts have been signed to develop the<br>following e-service: <br> <br>• monitoring and safety of navigation to and from<br>the ports of Larnaca and Vasiliko.|
|237|C4.2I2<br>Digitalisation of<br>the Cyprus Ports<br>Authority|Target|Advancement of<br>the digital<br>upgrade of the<br>Cyprus Ports<br>Authority|-|Number|0|4|Q4|2024|Finalisation and installation of at least four of the<br>systems from the list in target with sequential<br>number 236 for all relevant ports.|
|238|C4.2I2<br>Digitalisation of<br>the Cyprus Ports<br>Authority|Target|Finalisation of<br>the digital<br>upgrade of the<br>Cyprus Ports<br>Authority|-|Number|4|7|Q4|2025|All of the seven systems from the list in target with<br>sequential number 236 for all relevant ports are<br>installed and operational, with all<br>hardware/equipment installed and set up and<br>• administrative and reporting formalities between<br>ships arriving and/or departing from the Republic<br>of Cyprus;|

128

|Sequential<br>Number|Related Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Timeline for<br>completion<br>(indicate the<br>quarter and<br>the year)|Col10|Description and clear definition of each<br>milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||~~• monitoring and safety of navigation to and from ~~<br>the ports of Larnaca and Vasiliko.|

129

**L.** **COMPONENT** **5.1:** **E** **DUCATIONAL SYSTEM MODERNISATION** **,** **UPSKILLING AND RETRAINING**

This component of the Cypriot Recovery and Resilience plan addresses the challenges of low
participation in vocational education and training (VET) and lifelong learning, rising skills
mismatches (particularly among young graduates) and poor digital skills. It further addresses the
quality of teaching and the availability and affordability of early childhood education and care
(ECEC) for children aged four years old. Its objective is to (i) improve the quality and effectiveness
of education and training at all levels, (ii) foster the uptake of labour market-relevant reskilling and
upskilling opportunities, in particular regarding the twin transitions, across society regardless of
employment status, skills level or age, and (iii) modernise the school structures making them fit for
the digital transition.

The reforms and investments included in the component address the country-specific
recommendations on education and skills (country-specific recommendation 2 2020 and countryspecific recommendation 3 2019), early childhood education and care (country-specific
recommendation 3 2019) as well as on digital skills (country-specific recommendation 4 2019 and
country-specific recommendation 3 2020).

**L.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C5.1R1): Addressing skills mismatch between education and labour market (Secondary
and Higher Education)

The objective of the reform is to address the skills mismatch between the labour market and the
secondary and higher education system.

For this purpose, key initiatives of the National Action Plan shall be implemented including the
introduction of (i) a higher education graduate tracking system, (ii) a reform of secondary schools’
educational curricula to improve soft and entrepreneurial skills, (iii) an in-job shadowing programme
for secondary general education pupils, and (iv) new programmes of study in secondary general as
well as vocational education and training tailored to labour market needs. It shall further entail the
provision of high-quality training to secondary education teaching staff in close collaboration with
labour market experts as well as the upgrading of school laboratories with the latest technology and
equipment.

The implementation of the reform shall be completed by 31 December 2025.

Reform 2 (C5.1R2): A new teacher and school evaluation system

The aim of the reform is to improve the quality of education and consequently students’ educational

outcomes.

This reform shall modernise and update the current teachers and schools evaluation system by
developing a single evaluation scheme for primary, secondary and technical and vocational education
with differentiated elements. This contemporary evaluation system of schools and teachers shall
incorporate the training of teachers and evaluators.

The implementation of the reform shall be completed by 31 December 2025.

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                                       Reform 3 (C5.1R3): Gradual extension of free compulsory pre primary education from the age of

four

The objective of this reform is to enhance the availability and affordability of early childhood
education and care (ECEC) promoting the (re-)entry of people with childcare responsibilities, mostly
women, into the labour market as well as children’s educational outcomes and social inclusion.

It shall include the entry into force of a law providing for the gradual eight-month reduction of the
entry age in free compulsory pre-primary education (from current entry age of four years and eight
months to four years) starting in the academic year 2024-2025 until academic year 2032-2033.

The reform shall consist of the following: (i) gradual expansion of public kindergartens’ capacity; (ii)
an aid scheme to subsidise in full the tuition fees of communal kindergartens for children at the entry
age in free compulsory pre-primary education; (iii) an aid scheme which shall subsidise the tuition
fees for children above 4 years old and under the entry age in compulsory pre-primary education and
are enrolled in private kindergartens up to a maximum of 100% subject to a cap. The legislative
reform shall be gradually implemented in line with the adopted law. An Action Plan shall indicate
how the reform is implemented, through the gradual expansion of the capacity in public kindergartens
and the gradual corresponding reduction of the two aid schemes from the time of the entry into force
of the law until the completion of the decrease in compulsory age.

By 30 June 2026, the reform shall provide free and compulsory pre-primary education to children as
of the age of 4 years and 5 months and subsidise tuition fees for children between the age 4 years and
4 years and 5 months enrolled in private kindergartens.

Reform 4 (C5.1R4): Digital transformation of school units with the aim of enhancing digital skills
and skills related to STEM education

The aim of the reform is to support the digital transition of the education system.

This measure shall entail the modernisation of educational structures through the development of eclasses and the equipment of classrooms with digital tools, the transformation of curricula and
educational material to enhance digital skills and STEM methodology, as well as the relieving of
costs for the purchase of digital equipment (laptops/tablets) for students from low socio-economic
background. It shall further include the provision of digital skills and STEM methodology training to
at least 675 (out of which 300 primary, 300 secondary general and 75 secondary vocational teachers)
teachers per year for 5 years (in total at least 3 375 teachers which accounts for around 32% of all
teachers (primary and secondary)).

The implementation of the reform shall be completed by 30 June 2026.

Reform 5 (C5.1R5): E-skills Action Plan – Implementation of specific actions

This measure aims at enhancing digital competences across all population groups.

It shall include the (i) development of an e-skills policy framework and action plan, (ii) the design
and delivery of targeted programmes for public sector professionals promoting cross-sectoral
competencies, as well as (iii) the design of reskilling/upskilling interventions enhancing the digital
literacy of the workforce in the private sector and unemployed persons, with a special focus on women
and vulnerable groups. Furthermore, this measure shall entail a communication strategy to promote
lifelong learning and a digital culture in Cyprus, investments in digital infrastructure to support digital
learning and the development of an e-learning platform with key content material on digital skills and
cross-sectoral competences accessible to all target groups.

131

The implementation of the reform shall be completed by 31 December 2025.

Investment 1(C5.1I1): Construction of one Model Technical School

The objective of the investment is to provide students and educators with a modern well-equipped
environment for learning increasing the capacity, quality and attractiveness of vocational education
and training (VET) in Cyprus.

This measure shall comprise of the construction of one new technical school in Limassol (in
replacement of current A’ Technical School).

The implementation of the investment shall be completed by 30 June 2026.

Investment 2 (C5.1I2): Skilling, Reskilling and Upskilling

The aim of this investment is to strengthen the digital skills of the population in line with the e-skills
action plan, to enhance the knowledge and skills of persons in green and blue sectors of the economy
and to promote entrepreneurship competences.

The measure shall include the delivery of trainings for the strengthening of digital, green and blue
skills for all, entrepreneurship trainings for the unemployed, with a special emphasis on women and
vulnerable groups, as well as trainings in digital skills for people over the age of 55.

The implementation of the investment shall be completed by 31 December 2025.

132

**-**
**L.2. Milestones, targets, indicators, and timetable for monitoring and implementation for non** **repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|239a|C5.1R1<br>Addressing<br>skills mismatch<br>between<br>education and<br>labour market<br>(Secondary and<br>Higher<br>Education)|Milestone|Implementation of<br>key measures<br>from the National<br>Action Plan|Publication of<br>reports and<br>communication<br>by competent<br>authorities|-|-|-|Q4|2024|Full implementation of key measures from<br>the National Action Plan, including at<br>least:<br>(a) report on the preliminary results of<br>“Graduate Tracking of Cyprus Higher<br>Education" survey is published;<br>(b) 320 of the secondary schools’<br>educational curricula are reformed to<br>improve digital literacy, emotional<br>intelligence, soft skills and<br>entrepreneurship skills; and<br>(c) two new programmes of study are<br>developed.|
|239b|C5.1R1<br>Addressing<br>skills mismatch<br>between<br>education and<br>labour market<br>(Secondary and<br>Higher<br>Education)|Target|Completion of the<br>in-job shadowing<br>programme||Number|0|2250|Q2|2026|Complete an in-job shadowing programme<br>for at least 2250 secondary general<br>education pupils.|
|239c|C5.1R1<br>Addressing<br>skills mismatch<br>between<br>education and<br>labour market<br>(Secondary and<br>Higher<br>Education)|Target|Laboratories<br>equipped and<br>updated|-|Number|0|170|Q2|2026|Upgrading of 20 laboratories related to<br>Secondary Vocational Education and<br>Training, and 150 laboratories related to<br>General Secondary Education.|

133

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|240|C5.1R1<br>Addressing<br>skills mismatch<br>between<br>education and<br>labour market<br>(Secondary and<br>Higher<br>Education)|Target|Secondary<br>education<br>teaching staff<br>trained|-|Number|0|3 100|Q4|2025|At least 3 100 secondary education<br>teaching staff are trained in the reformed<br>educational curricula.|
|241|C5.1R2<br>A new teacher<br>and school<br>evaluation<br>system|Milestone|Entry into force of<br>the law for<br>establishing a new<br>Teacher and<br>School Evaluation<br>mechanism|Provision in the<br>law(s)<br>indicating the<br>entry into force<br>of the law(s)|-|-|-|Q4|2023|Entry into force of the law for establishing<br>a new Teacher and School Evaluation<br>mechanism, which shall stipulate that the<br>new mechanism applies at the latest from<br>the school year 2024/2025.|
|242|C5.1R2<br>A new teacher<br>and school<br>evaluation<br>system|Target|Training of<br>teaching staff|-|Number|0|1 100|Q4|2025|At least 1 100 teaching staff (teachers,<br>deputy heads and school heads) have been<br>trained for the new Teachers and School<br>Evaluation system.|
|243|C5.1R3<br>Gradual<br>extension of free<br>compulsory pre-<br>primary<br>education from<br>the age of four|Milestone|Entry into force of<br>the new Law<br>regarding the<br>gradual extension<br>of free<br>compulsory pre-<br>primary education<br>from the age of<br>four years and<br>adoption of aid<br>schemes by the<br>Council of<br>Ministers|Provision in the<br>law(s)<br>indicating the<br>entry into force<br>of the law(s)|-|-|-|Q4|2023|Entry into force of the Law which shall<br>gradually (starting in the academic year<br>2024-2025 until academic year 2032-2033)<br>reduce the entry age in free compulsory<br>pre-primary education from the age of four<br>years and eight months to four years.<br>Adoption by the Council of Ministers of<br>aid schemes to (a) cover tuition fees for the<br>free compulsory pre-primary education in<br>communal kindergartens, for children that<br>cannot be enrolled in public kindergartens,<br>and (b) subsidise tuition fees in private<br>kindergartens, for the enrolment of|

134

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||~~children aged under the entry level of~~<br>compulsory pre-primary education and<br>above the age of four.|
|244|C5.1R3<br>Gradual<br>extension of free<br>compulsory pre-<br>primary<br>education from<br>the age of four|Target|Children aged<br>between 4 years<br>and 4 years and 8<br>months enrolled<br>in public,<br>communal and<br>private<br>kindergartens|-|Number|0|3375|Q2|2026|At least 3 375 children between the ages of<br>4 years and 5 months and 4 years and 8<br>months enrolled in free compulsory pre-<br>primary education. At least 3 375 children,<br>between the ages of 4 years and 4 years<br>and 5 months were enrolled in private<br>kindergartens with subsidised fees.|
|245|C5.1R3<br>Gradual<br>extension of free<br>compulsory pre-<br>primary<br>education from<br>the age of four|Target|New places<br>developed in new<br>or extended<br>public<br>kindergartens|-|Number|0|675 new<br>places in<br>public<br>kindergartens|Q2|2026|At least 675 new places in public<br>kindergartens in line with an Action Plan.<br>|
|246a|C5.1R4<br>Digital<br>transformation<br>of school units<br>with the aim of<br>enhancing<br>digital skills and<br>skills related to<br>STEM<br>education|Target|Classrooms<br>digitally equipped|-|Number|0|700|Q2|2024|Classrooms in at least 700 schools have<br>been digitally equipped with laptops,<br>projectors, microphones, speakers, digital<br>graphic boards.|
|246b|C5.1R4<br>Digital<br>transformation<br>of school units<br>with the aim of<br>enhancing|Target|Partial<br>reimbursement<br>for the purchase<br>of digital<br>equipment for<br>pupils|-|Number|0|15 000|Q2|2026|Partial reimbursement of the purchase of a<br>tablet/laptop for 15000 primary and<br>secondary school students from lower<br>socio-economic background.|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**<br>|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
||~~digital skills and~~<br>skills related to<br>STEM<br>education||||||||||
|247|C5.1R4<br>Digital<br>transformation<br>of school units<br>with the aim of<br>enhancing<br>digital skills and<br>skills related to<br>STEM<br>education|Target|Curriculum<br>transformation<br>and production of<br>educational<br>material for<br>digital skills and<br>STEM<br>methodology|-|Number|0|120|Q4|2024|Curriculum transformation and production<br>of educational material for digital skills<br>and STEM methodology for 120 school<br>subjects.|
|248|C5.1R4<br>Digital<br>transformation<br>of school units<br>with the aim of<br>enhancing<br>digital skills and<br>skills related to<br>STEM<br>education|Target|Teachers<br>benefitting from<br>In-Service<br>Training &<br>Professional<br>Development|-|Number|0|3 375|Q2|2026|At least 3 375 primary and secondary<br>teachers have benefitted from In-Service<br>Training & Professional Development on<br>Digital Competences.|
|249|C5.1R5<br>E-skills Action<br>Plan– <br>Implementation<br>of specific<br>actions|Milestone|National e-Skills<br>Action Plan is<br>adopted by the<br>Council of<br>Ministers|National e-<br>Skills Action<br>Plan is adopted<br>by the Council<br>of Ministers<br>|-|-|-|Q4|2021|National e-Skills Action Plan is adopted by<br>the Council of Ministers, which shall<br>include at least:<br>• development of an e-learning platform,<br>containing a<br>self-assessment tool for digital fitness,<br>index of all available skilling programmes,<br>and content material on digital skills and<br>cross-sectoral competences;|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||~~• design and delivery of programmes and~~<br>interventions for professionals within the<br>public sector in areas such as Project<br>management, Microsoft tools,<br>cybersecurity, social media, e-<br>collaboration and productivity tools;<br>• investment in digital infrastructure.|
|250|C5.1R5<br>E-skills Action<br>Plan– <br>Implementation<br>of specific<br>actions|Milestone|Implementation of<br>key measures<br>from the e-Skills<br>Action Plan|Publication of<br>annual report by<br>Deputy Ministry<br>of Research,<br>Innovation and<br>Digital Policy<br>and relevant<br>postings<br>/announcements<br>on the e-<br>learning<br>platform<br>|-|-|-|Q4|2025|Full implementation of key measures from<br>the e-Skills Action Plan, which shall<br>include at least:<br>- design and delivery of targeted<br>programmes for professionals within the<br>public sector for digital skills and cross-<br>sectoral competencies (such as project<br>management);<br>- relevant investments in digital<br>infrastructure (such as laptops, computers);<br>- design of one e-learning platform with<br>educational material is provided to include<br>courses offered by educational institutions;<br>- implementation of communication<br>strategy through, amongst others, funded<br>events.|
|251|C5.1I1<br>Construction of<br>one Model<br>Technical<br>School|Milestone|Contract for the<br>construction of<br>one Technical<br>School|Contract<br>Signature and<br>initiation of<br>construction|-|-|-|Q4|2022|Signing of a contract with the contractor<br>selected under a competitive call for<br>proposals for the construction of one<br>Technical School  in Limassol and issue of<br>construction initiation order by the project<br>Engineer.|
|252|C5.1I1<br>Construction of<br>one Model<br>Technical<br>School|Milestone|Completion of<br>construction of<br>one Technical<br>School|Issue of Taking-<br>Over<br>Certificate for<br>one construction<br>project|-|-|-|Q2|2026|Completion of construction of one<br>Technical School in Limassol and issue of<br>taking over certificate. School fully<br>operational from start of the school year<br>2026-2027.|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|253|C5.1I2<br>Skilling,<br>Reskilling and<br>Upskilling|Target|Completion of<br>trainings for at<br>least 11 500<br>participants|-|Number|0|11 500|Q4|2024|Completion of trainings for at least 11 500<br>participants in programmes for digital<br>skills, skills related to blue and green<br>economy, entrepreneurship programmes<br>for unemployed and inactive people and<br>training programmes for people over 55.|
|254|C5.1I2<br>Skilling,<br>Reskilling and<br>Upskilling|Target|Completion of<br>trainings for at<br>least 25 600<br>participants|-|Number|11 500|25 600|Q4|2025|Completion of trainings for at least 25 600<br>participants in programmes for digital<br>skills, skills related to blue and green<br>economy, entrepreneurship programmes<br>for unemployed and inactive people and<br>training programmes for people over 55.|

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**M.** **COMPONENT** **5.2:** **LABOUR MARKET** **,** **SOCIAL PROTECTION AND INCLUSION**

This component of the Cypriot Recovery and Resilience plan addresses: (i) inefficiencies and gaps in
social protection notably for self-employed and people working in non-standard forms of
employment, (ii) the lack of legislation for flexible working arrangements in the form of teleworking,
(ii) challenges related to unemployment and youth unemployment and the high level of young people
not in employment, education or training (NEETs), (iii) gaps in early childhood education and care
(ECEC) and (iv) challenges with respect to social inclusion and welfare, including a high level of
people at risk of poverty or social exclusion (AROPE) and increasing needs in long-term care.

The reforms and investments included in the component address the country-specific
recommendations on improving the effectiveness of the public employment services and the
education and training system (country specific recommendation 3 of 2019 and country specific
recommendation 2 of 2020), providing social protection for all and introducing flexible working
arrangements (country specific recommendation 2 of 2020), and improving the efficiency and
digitalisation of the public sector (country specific recommendation 1 of 2019 and country specific
recommendation 4 of 2020).

**M.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 2 (C5.2R2): Flexible work arrangements in the form of telework

The objective of the reform is to promote flexible work arrangements in the form of telework to
enhance work-life balance and increase employment opportunities.

The reform consists of new legislation for flexible work arrangements in the form of telework and
the promotion of collective agreements to regulate telework. It shall also include a scheme relieving
part of staff costs as an incentive for employers to hire unemployed persons who shall telework.

The implementation of the reform shall be completed by 30 September 2025.

Investment 1 (C5.2I1): Improving the effectiveness of the Department of Labour and Public
Employment Services (PES) and reinforcing support for young people

The objectives of the investment are to: (i) safeguard the successful implementation of employment
schemes through digitalisation of their administration, (ii) improve the operational performance of
the PES, (iii) minimise the risk for young persons not in employment, education or training (NEETs)
to become long-term unemployed, (iv) support NEETs who are not yet registered with the PES by
facilitating the integration of young registered unemployed in the labour market.

The investment consists of: the completion of platforms/IT systems for digitalising the schemes
managed by the Department of Labour, developing a Performance Management System for the PES
and developing an early warning and tracking system for NEETs. In addition, the investment shall
include coaching and career guidance for the labour market orientation and integration of NEETs and
an incentive scheme for employers to hire NEETs.

The implementation of the investment shall be completed by 30 June 2026.

Investment 2 (C5.2I2): Establishment of Multifunctional Centres and Childcare Centres

The objective of the investment is to increase the labour market participation of carers (often women),
and to enhance the availability of quality care and social development infrastructure for children,
thereby contributing to gender equality and equal opportunities for all.

The investment consists of a scheme targeted at local authorities and non-governmental organisations
(NGOs) for establishing new or improving existing multifunctional centres and child centres for
children aged 0 to 3 years and 8 months, as well as for children until the age of 13 based on needs

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assessment and viability analysis. In addition, in line with Article 7 (2) of the Recovery and Resilience
Facility Regulation, the investment includes a study under the Technical Support Instrument (TSI) to
analyse the state of provision of early childhood education and care services for young children (aged
0 to school age) in Cyprus and to develop recommendations for investment in the sector, and
specifically in child centres. Following the recommendations of the TSI project, a national strategy
on early childhood education and care (ECEC) and an accompanying action plan shall be adopted.

The implementation of the investment shall be completed by 30 June 2026.

Investment 3 (C5.2I3): Establishment of home structures for children, adolescents with conduct
disorders, persons with disabilities and people in need of long-term care

The objectives of the investment are to: (i) support the Republic of Cyprus to meet its obligations
under the Refugee Act 2000-2016 to provide care and to safeguard the rights of unaccompanied
minors who arrive in the Republic, (ii) meet the housing needs for children and adolescents with
particular difficulties who are placed under the guardianship of the social welfare services, (iii)
enhance community-based supported living structures for persons with disabilities to avoid
institutionalisation and social exclusion and (iv) address gaps in long-term care services.

The investment consists of the establishment of at least eight state structures for children or persons
with disabilities and the establishment or renovation of at least eighteen homes for children,
adolescents with conduct disorders and people in need of long-term care (through tender procedures
and aid schemes).

The implementation of the investment shall be completed by 30 June 2026.

Investment 4 (C5.2I4): Child centres in municipalities

The objective of this investment is to facilitate the participation and re-entering of workers with caring
responsibilities, mostly women, in the labour market, thereby promoting gender equality. It further
aims at enhancing the social inclusion of children from disadvantaged and/or migrant background.

The investment consists of the construction of four (4) child care centres in the municipalities of
Ayios Athanasios, Ayia Napa, Paralimni and Yermasoyia.

The implementation of the investment shall be completed by 31 December 2024.

Investment 5 (C5.2I5): Construction of two model special education schools

The objective of the investment is to improve the school environment for pupils with severe
disabilities or other special educational needs and support their academic and social development.

The investment consists of the replacement of two special schools in the Limassol district: (i) the
Special Education School of Apostolos Loucas and (ii) the Red Cross Recovery Special Needs
School. The schools shall be constructed adjacent to each other and shall share the multi-purpose hall
as well as a therapeutic indoor swimming pool.

The implementation of the investment shall be completed by 31 December 2025.

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**M.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|255|C5.2R2<br>Flexible Work<br>Arrangements in<br>the Form of<br>Telework|Milestone|Entry into force of<br>the law for<br>flexible work<br>arrangements in<br>the form of<br>telework|Provision in<br>the law<br>indicating the<br>entry into<br>force of the<br>law for the<br>flexible work<br>arrangements<br>in the form of<br>telework|-|-|-|Q2|2023|Entry into force of a new law which shall regulate<br>flexible work arrangements in the form of<br>telework. The law shall include a definition of<br>telework, description of the economic activities<br>where telework is applicable, the conditions for<br>taking up telework and the rights and obligations<br>of employers and employees.|
|256|C5.2R2<br>Flexible Work<br>Arrangements in<br>the Form of<br>Telework|Target|Grant awarded for<br>at least 400<br>persons in<br>telework|-|Number|0|400|Q3|2025|Grant awarded to employers to employ at least<br>400 previously unemployed persons after<br>completing 12 months of employment with at<br>least 30% in telework.|
|258|C5.2I1<br>Improving the<br>effectiveness of<br>the Department<br>of Labour and<br>Public<br>Employment<br>Services and<br>reinforcing<br>support for<br>young people|Target|Implementation of<br>completed, fully<br>operational<br>platforms|-|Number|0|3|Q4|2024|Implementation of completed, fully operational<br>platforms for<br>(1) digitalising the hiring schemes of the<br>Department of Labour,<br>(2) developing a Performance Management<br>System for the Public Employment Services and<br>(3) developing an early warning and tracking<br>system for young people not in education,<br>employment or training (NEETs) for the Public<br>Employment Services.|
|259|C5.2I1<br>Improving the<br>effectiveness of|Target|Grant awarded to<br>employers for<br>hiring at least 600|-|Number|0|600|Q4|2025|Grant awarded to employers for hiring at least 600<br>young people (aged 15-29) not in employment,<br>education or training (NEETs), for a 12-month|

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|Col1|the Department<br>of Labour and<br>Public<br>Employment<br>Services and<br>reinforcing<br>support for<br>young people|Col3|young people not<br>in employment or<br>in education or<br>training (NEETs)|Col5|Col6|Col7|Col8|Col9|Col10|employment period, following completion of a<br>two-month subsidised training period (two months<br>subsidised training and 10-month subsidised<br>employment).|
|---|---|---|---|---|---|---|---|---|---|---|
|260|C5.2I1<br>Improving the<br>effectiveness of<br>the Department<br>of Labour and<br>Public<br>Employment<br>Services and<br>reinforcing<br>support for<br>young people|Target|Coaching and<br>career guidance<br>for young people<br>not in<br>employment or in<br>education or<br>training (NEETs)|-|Number|0|5 500|Q2|2026|Coaching and career guidance for the labour<br>market orientation and integration of young<br>people offered to at least 5 500 young people not<br>in employment, education or training (NEETs)<br>through the public employment services.|
|261|C5.2I2<br>Establishment<br>of<br>multifunctional<br>centres and<br>childcare<br>centres|Milestone|Adoption of a<br>national strategy<br>on early<br>childhood<br>education and<br>care (ECEC) and<br>an accompanying<br>action plan by the<br>Council of<br>Ministers|Publication of<br>the national<br>strategy on<br>ECEC and the<br>accompanying<br>action plan|-|-|-|Q4|2024|A national strategy on enhancing early childhood<br>education and care (ECEC) covering children<br>aged zero to school age, and an accompanying<br>action plan have been adopted by the Council of<br>Ministers, taking into account the<br>recommendations of the completed TSI project.|
|262|C5.2I2<br>Establishment<br>of<br>multifunctional<br>centres and<br>childcare<br>centres|Target|Grant awarded to<br>at least ten local<br>authorities/ Non-<br>Governmental<br>Organisations for<br>establishing or<br>enhancing<br>Multifunctional<br>Centres or Child<br>Centres|-|Number|0|10|Q4|2024|At least ten local authorities/ Non-Governmental<br>Organisations have received a grant for<br>establishing or enhancing Multifunctional Centres<br>or Child Centres.|
|263|C5.2I2|Target|Grant awarded to<br>at least 27 local|-|Number|10|27|Q2|2026|At least 27 local authorities/ Non-Governmental<br>Organisations have received a grant for|

142

|Col1|Establishment<br>of<br>multifunctional<br>centres and<br>childcare<br>centres|Col3|authorities/ Non-<br>Governmental<br>Organisations for<br>establishing or<br>enhancing<br>Multifunctional<br>Centres or Child<br>Centres|Col5|Col6|Col7|Col8|Col9|Col10|establishing or enhancing Multifunctional Centres<br>or Child Centres.|
|---|---|---|---|---|---|---|---|---|---|---|
|264|C5.2I3<br>Establishment<br>of Home<br>structures for<br>children,<br>adolescent with<br>conduct<br>disorders and<br>persons with<br>disabilities and<br>people in need<br>of long term<br>care (LTC)|Target|Buildings for the<br>needs of children<br>or persons with<br>disabilities and<br>support for homes<br>for children,<br>adolescents with<br>conduct disorders<br>and people in<br>need of long-term<br>care (signing of<br>contracts/funding<br>agreements)|-|Number|0|26|Q3|2024|Signing of contracts/funding agreements for the<br>establishment of at least 26 buildings for the needs<br>of children or persons with disabilities and for<br>homes for children, adolescents with conduct<br>disorders and people in need of long-term care.|
|265|C5.2I3<br>Establishment<br>of Home<br>structures for<br>children,<br>adolescent with<br>conduct<br>disorders and<br>persons with<br>disabilities and<br>people in need<br>of long term<br>care (LTC)|Target|Buildings for the<br>needs of children<br>or persons with<br>disabilities and<br>support for homes<br>for children,<br>adolescents with<br>conduct disorders<br>and people in<br>need of long-term<br>care<br>(establishment)|-|Number|0|26|Q2|2026|Establishment of at least 26 buildings for the<br>needs of children or persons with disabilities and<br>for homes  for children, adolescents with conduct<br>disorders and people in need of long-term care.|
|266|C5.2I4<br>Child Centres in<br>Municipalities|Target|Construction of at<br>least one child<br>centre|-|Number|0|1|Q4|2022|Completion of construction and issue of taking-<br>over certificate of at least one child centre in one<br>of the following municipalities: Ayios Athanasios,<br>Ayia Napa, Paralimni and Yermasoyia.|
|267|C5.2I4<br>Child Centres in<br>Municipalities|Target|Construction of at<br>least four child<br>centres|-|Number|1|4|Q4|2024|Completion of construction and issue of taking-<br>over certificates of four child centres (one child|

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|Col1|Col2|Col3|Col4|Col5|Col6|Col7|Col8|Col9|Col10|centre in Ayios Athanasios, one in Ayia Napa, one<br>in Paralimni and one in Yermasoyia).|
|---|---|---|---|---|---|---|---|---|---|---|
|268|C5.2I5<br>Construction of<br>Two Model<br>Special<br>Education<br>Schools|Milestone|Signing of<br>contract with the<br>selected tenderer<br>(contractor)|The contract<br>shall be signed<br>with the<br>selected<br>tenderer<br>(contractor)|-|-|-|Q4|2022|Signing of contract with the selected tenderer(s)<br>(contractor (s)) selected under a competitive call<br>for proposals for the construction of two model<br>schools in Limassol - the Special Education<br>School of Apostolos Loucas and the Red Cross<br>Recovery Special Needs School.|
|269|C5.2I5<br>Construction of<br>Two Model<br>Special<br>Education<br>Schools|Milestone|Completion of<br>construction of<br>Apostolos Loukas<br>& Red Cross<br>Special needs<br>school|Issue of<br>taking-over<br>certificates by<br>the project<br>engineer<br>verified<br>administrative<br>ly and on the<br>spot, by the<br>Head of<br>Technical<br>Services of the<br>Ministry of<br>Education &<br>Culture.|-|-|-|Q4|2025|Completion of construction of the Special<br>Education School of Apostolos Loucas and of the<br>Red Cross Recovery Special Needs School.|

144

**M.3.** **Description of the reforms and investments for the loan**

Reform 1 (C5.2R1): Reform of the Social Insurance System and Restructuring of the Social Insurance
Services

The objectives of the reform are to widen access to social protection and to improve the operational
efficiency and effectiveness of the Social Insurance Services. More specifically, the reform shall
extend and improve the cover of benefits. This may include, for example, unemployment benefit,
accident at work benefit and occupational disease benefit in particular for the self-employed,
including people working with contracts or new forms of employment (such as platform workers). In
addition, the reform shall improve the timeliness and accuracy of the services provided to citizens
and minimise fraud and errors through risk analysis and quality control mechanisms.

The reform consists of: (i) a revision of the legislation for the Social Security System which shall
incorporate the extension of the social security coverage to self-employed, including non-standard
forms of employment, such as platform work, and (ii) the re-engineering of business processes,
personnel training, set-up of data analytics capacity and digitalisation of services, as well as (iii) the
gradual upgrading of the existing IT Systems to an Integrated Information System.

The implementation of the reform shall be completed by 30 June 2026.

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**M.4.** **Milestones, targets, indicators, and timetable for monitoring and implementation for the loan**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|270|C5.2R1<br>Reform of the<br>Social<br>Insurance<br>System and<br>Restructuring<br>of the Social<br>Insurance<br>Services|Milestone|Entry into<br>force of the<br>revised<br>Social<br>Insurance<br>Law|Provision in the<br>amending law<br>indicating the entry<br>into force of the<br>revisions to the<br>Social Insurance<br>Law|-|-|-|Q2|2023|Entry into force of the revised Social Insurance<br>Law, which shall incorporate the extension of<br>the social security coverage to self-employed,<br>including non-standard forms of employment,<br>such as platform work.|
|271|C5.2R1<br>Reform of the<br>Social<br>Insurance<br>System and<br>Restructuring<br>of the Social<br>Insurance<br>Services|Milestone|Completion<br>of the<br>upgrading<br>of the<br>existing IT<br>systems to<br>an<br>Integrated<br>Social<br>Security<br>Information<br>System|Deliverables<br>acceptance team<br>(contracting<br>authority side) signs<br>off on analysis,<br>design and<br>development report|-|-|-|Q2|2026|Completion and go-live of the Integrated<br>Social Security Information System including<br>payment module, benefits administration<br>module, data analytics and interoperability<br>with other systems.|

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**N.** **COMPONENT** **6.1:** **REP** **OWER** **EU**

The REPowerEU chapter addresses the challenge of reducing reliance on fossil fuels. The objectives
of the component are to strongly reduce Cyprus’ dependence from imported fossil fuels in general.
The new RePowerEU chapter contributes to the achievement of Cyprus’s energy efficiency
obligations and targets set for 2030, under the National Energy and Climate Plan. In order to limit its
energy dependence, Cyprus shall further invest in energy efficiency improvements in buildings and
road transport and accelerate the deployment of renewables.

The measures included in the REPowerEU chapter address most aspects of recent country-specific
recommendations in the field of energy, as they shall foster research and innovation in the field of
green transition and energy production, storage, transmission and distribution solutions, promote
renewables and accelerate energy efficiency measures in various buildings in the public and private
sector, enhance the regulatory framework for the operation of Energy Communities, and promote
widespread use of Electric Vehicles.

It is expected that no measure in this component does significant harm to environmental objectives
within the meaning of Article 17 of Regulation (EU) 2020/852, taking into account the description of
the measures and the mitigating steps set out in the recovery and resilience plan in accordance with
the ‘Do no significant harm’ Technical Guidance (2021/C58/01).

The implementation of the measures are all expected to contribute to reducing dependency on fossil
fuels. Increasing the share of renewable energy sources has a cross-border and multi-country
dimension because it contributes to securing the energy supply in the Union as a whole.

**N.1.** **Description of the reforms and investments for non-repayable financial support**

Reform 1 (C6.1R1) Regulating and facilitating the participation of Active Customers, Renewable
Self-consumers, Citizen Energy Communities, Renewable Energy Communities and Demand
Response through Cumulative Representation in the electricity market

The objectives of this reform are the promotion of participation of citizens either as Active Customers
and/or Renewable Self-consumers, through Citizen Energy Communities and/or Renewable Energy
Communities, Demand Response through Cumulative Representation in the national energy market.
This reform should enable the uptake of renewable energy projects in the country, thereby allowing
a faster penetration of renewable energy in the economy.

Following the adoption of the relevant regulatory decisions by CERA, completing the framework
regarding Active Customers and Renewable Self-consumers, Citizen Energy Communities,
Renewable Energy Communities and Demand Response, the measure aims at creating one or more
contact points for the above-mentioned groups and communities by expanding the single contact point
established as per the Renewable Energy Directive (EU) 2018/2001, on the relevant permit-granting
process. Those contact points shall, upon the request of an interested party, guide and facilitate the
interested parties during the entire administrative procedure that is needed for the

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creation/participation in RECs and CECs as well as for becoming Renewable self-consumers or active
customers. Moreover, the contact points will be responsible to provide to eligible entities, useful
information and reply to questions, facilitate meetings with stakeholders and relevant authorities,
regarding the establishment of energy communities and/or their participation in the electricity
market. Interested parties shall be allowed to submit relevant requests, queries and documents both
in digital and physical form.

The implementation of the reform shall be completed by 31 December 2025.

Reform 2 (C6.1R2) Introduction of regulatory framework for the connection of EV recharging points
to the distribution network

The objectives of this reform are the establishment of guidelines for the formulation of regulatory
frameworks regarding the procurement of flexibility services by the DSO as well as the connection
of Electric Vehicle Charging Points to the Distribution Network. This reform shall facilitate the
rollout of electric vehicles (EVs) and enable final consumers to actively participate in the electricity

market.

The reform consists in the introduction of a regulatory framework that facilitates the connection of
charging points to the distribution network and ensures the interplay with the DSO, together with the
guidelines on a fair tendering procedure for the public contracts; and provides the framework for the
licencing of the DSO for the procurement of flexibility services, including congestion management.

The implementation of the reform shall be completed by 31 December 2025.

                   Investment 1 (C6.1I1). Scaled up measure: Promoting renewables and individual energy efficiency
measures in dwellings and tackling energy poverty, including in households with vulnerable
electricity consumers

The objective of this measure is to scale up Investment C2.1I2: Promoting renewables and individual
energy efficiency measures in dwellings and tackling energy poverty, including in households with
vulnerable electricity consumers under Component 2.1. The scaled-up part of the measure shall
increase the number of dwellings, including households of vulnerable electricity consumers, with
improved energy performance thus aiming at increasing energy savings and further tackling energy

poverty.

                   Investment 2 (C6.1I2). Scaled up measure: Encouraging the use of renewables and energy savings
by local/wider public authorities

The objective of this measure is to scale up Investment C2.1I3: Encouraging the use of renewables
and energy savings by local/wider public authorities and facilitating the transition of local
communities towards climate mitigation & adaptation under Component 2.1. The scaled-up part of
the measure shall lead to further reduction in primary energy consumption per year for local and wider
public authorities.

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Investment 3 (C6.1I3) Promoting extensive energy upgrading of housing stock

The aim of this investment is to reduce the primary and final energy consumption and the CO2
emissions in existing households. In addition, the scheme shall promote the installation of Renewable
Energy Systems in those households. The renovation programme shall lead to a 30% reduction in the
Primary Energy Demand of the buildings renovated.

The eligible investments under the grant scheme shall include:

a. The cost of issuing the Energy Performance Certificate (EPC) of the household before and

after the implementation of the interventions.
b. Energy efficiency measures (including building renovations) in buildings such as thermal

insulation of horizontal and vertical building elements, replacement of windows, external
shading, solar systems for the production of hot water, installation of RES Systems for space
heating / cooling, highly efficient air-conditioning systems.
c. Installation of Photovoltaic Systems (Net-Billing οperation). Installation of batteries for

energy storage.

                  Investment 4 (C6.1I4). Scaled up measure: Promote widespread use of Electric Vehicles (EVs)

The objective of this measure is to scale up Investment C2.2I3: Promote widespread use of Electric
Vehicles (EVs), under Component 2.2. The scaled-up part of the measure shall increase the number
of electric vehicles purchased, taking also into account price increases in the market.

Investment 5 (C6.1I5). Scaled-up measure: Scheme for the enhancement of the competitiveness and
the energy efficiency of large enterprises in Cyprus

The objective of this measure is to scale up Investment C3.1I7: Scheme for the enhancement of the
competitiveness and the energy efficiency of large enterprises in Cyprus, under Component 3.1. The
scaled-up part of the measure shall increase the number of large enterprises supported, in all economic
sectors, with the aim to improve their energy performance through energy efficiency measures,
installation of photovoltaic systems and circular economy measures linked to the REPowerEU
objectives as laid out in Article 21c(3) of Regulation (EU) 2021/241.

The scaled-up part of the investment shall consist in a grant scheme of at least EUR 10 000 000
dedicated to support energy efficiency investments undertaken by large enterprises, such as
investments for improving the energy performance of buildings, for energy efficiency measures
related to production processes, for renewable energy and cogeneration systems, as well as for
circular economy.

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the eligibility criteria contained in terms of reference for upcoming calls for projects
shall exclude the following list of activities [15] : (i) activities related to fossil fuels, including
downstream use; (ii) activities under the EU Emission Trading System (ETS) achieving projected
greenhouse gas emissions that are not lower than the relevant benchmarks; (iii) activities related to
waste landfills, incinerators and mechanical biological treatment plants; and (iv) activities where the
long-term disposal of waste may cause harm to the environment. The terms of reference shall
additionally require that only activities that comply with relevant EU and national environmental
legislation may be selected.

The implementation of the investment shall be completed by 30 June 2026.

15 All footnotes set out in the text on measure C2.1I4 are also applicable to this measure.

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Investment 6 (C6.1I6). Scaled-up measure: Thematic research and innovation funding program on
green transition

The objective of this measure is to scale up Investment C3.2I3: R&I funding program on green
transition, under Component 3.2. The scaled-up part of the measure shall increase the number of
organisations engaged in green transition R&I activities, due to the support provided.

Investment 7 (C6.1I7). Thematic research in enterprises for energy production, storage, transmission
and distribution solutions

The aim of this investment is the provision of grants to organisations for targeted R&I activities
aiming to provide solutions to bottlenecks identified in energy production, storage, transmission and
distribution that shall enhance the national grid’s infrastructure functionality and efficiency,
accelerate RES deployment and significantly reduce the country’s energy needs.

In order to ensure that the measure complies with the ‘Do no significant harm’ Technical Guidance
(2021/C58/01), the eligibility criteria contained in terms of reference for upcoming calls for projects
shall exclude the following list of activities : (i) activities related to fossil fuels, including downstream
use [16] ; (ii) activities under the EU Emission Trading System achieving projected greenhouse gas
emissions that are not lower than the relevant benchmarks [17] ; (iii) activities related to waste landfills,
incinerators [18] and mechanical biological treatment plants [19] ; and (iv) activities where the long-term
disposal of waste may cause harm to the environment. The terms of reference shall additionally
require that only activities that comply with relevant EU and national environmental legislation may
be selected.

16 Except projects under this measure in power and/or heat generation, as well as related transmission and distribution infrastructure, using natural gas,

that are compliant with the conditions set out in Annex III of the ‘Do no significant harm’ Technical Guidance (2021/C58/01).

17 Where the activity supported achieves projected greenhouse gas emissions that are not significantly lower than the relevant benchmarks an explanation
of the reasons why this is not possible should be provided. Benchmarks established for free allocation for activities falling within the scope of the
Emissions Trading System, as set out in the Commission Implementing Regulation (EU) 2021/447.

18 This exclusion does not apply to actions under this measure in plants exclusively dedicated to treating non- recyclable hazardous waste, and to existing
plants, where the actions under this measure are for the purpose of increasing energy efficiency, capturing exhaust gases for storage or use or recovering
materials from incineration ashes, provided such actions under this measure do not result in an increase of the plants’ waste processing capacity or in
an extension of the lifetime of the plants; for which evidence is provided at plant level.

19 This exclusion does not apply to actions under this measure in existing mechanical biological treatment plants, where the actions under this measure
are for the purpose of increasing energy efficiency or retrofitting to recycling operations of separated waste to compost bio-waste and anaerobic digestion
of bio-waste, provided such actions under this measure do not result in an increase of the plants’ waste processing capacity or in an extension of the
lifetime of the plants; for which evidence is provided at plant level.

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**N.2.** **Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone<br>/ Target|Name|Qualitative<br>indicators<br>(for<br>milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative timeline<br>for completion|Col10|Description of each milestone and target|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone**<br>**/ Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for**<br>**milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|272|C6.1R1<br>Regulating and<br>facilitating the<br>participation of<br>Active<br>Customers,<br>Renewable Self-<br>Consumers,<br>Citizen Energy<br>Communities,<br>Renewable<br>Energy<br>Communities<br>and Demand<br>Response<br>through<br>Cumulative<br>Representation<br>in the electricity<br>market|Milestone|Expanding the<br>competencies<br>of the single<br>contact point<br>established as<br>per the<br>Renewable<br>Energy<br>Directive (EU)<br>2018/2001, to<br>also serve as a<br>contact point<br>regarding the<br>Renewable<br>Energy<br>communities<br>and Citizen<br>Energy<br>communities,<br>Active<br>customers and<br>Renewable<br>self-consumers|Publication of<br>Council of<br>Ministers’<br>Decision in<br>the official<br>gazette|-|-|-|Q4|2025|Creation of at least one contact point<br>regarding the renewable and citizens<br>communities, Active customers and<br>Renewable self-consumers by expanding<br>the single contact point established as per<br>the Renewable Energy Directive (EU)<br>2018/2001, on the relevant permit-granting<br>process, as to include the provision of <br>guidance and facilitation to the interested<br>parties during the entire administrative<br>procedure that is needed for the<br>creation/participation in RECs and CECs.|
|273|C6.1R2<br>Establishment of<br>the regulatory|Milestone|Regulatory<br>Decision/s for<br>the connection|Publication of<br>Regulatory<br>Decision/s in|-|-|-|Q4|2025|Publication and entry into force of<br>regulatory decision/s issued by CERA for<br>the connection of Electric Vehicle|

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|Col1|framework for<br>the connection<br>of EV<br>recharging<br>points to the<br>distribution<br>network|Col3|of EV<br>recharging<br>points to the<br>distribution<br>network|the official<br>gazette|Col6|Col7|Col8|Col9|Col10|Charging Points to the Distribution<br>Network. Publication of the regulatory<br>decision/s on procurement of flexibility<br>services by the DSO, including provisions<br>for the gradual entry into force of the<br>decision/s, in line with the relevant<br>guidelines established under this RRP<br>reform.|
|---|---|---|---|---|---|---|---|---|---|---|
|28b|C6.1I1 Scaled-<br>up measure:<br>Promoting<br>renewables and<br>individual<br>energy<br>efficiency<br>measures in<br>dwellings and<br>tackling energy<br>poverty in<br>households with<br>vulnerable<br>electricity<br>consumers<br>|Target|Dwellings and<br>households<br>with<br>vulnerable<br>electricity<br>consumers<br>having<br>improved their<br>energy<br>performance|-|Number|8 500|14 000|Q4|2023|At least 14 000 dwellings, including 1000<br>households of vulnerable electricity<br>consumers (including people with<br>disabilities) have improved their energy<br>performance due to the financial support<br>provided, with an objective to achieve on<br>average at least a 30% primary energy<br>demand reduction.|
|29b|C6.1I1 Scaled-<br>up measure:<br>Promoting<br>renewables and<br>individual<br>energy<br>efficiency<br>measures in|Target|Dwellings and<br>households<br>with<br>vulnerable<br>electricity<br>consumers<br>having<br>improved their|-|Number|16 200|30 000|Q2|2026|At least 30 000 dwellings, including 3000<br>households of vulnerable electricity<br>consumers (including people with<br>disabilities) have improved their energy<br>performance due to the financial support<br>provided, with an objective to achieve on|

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|Col1|dwellings and<br>tackling energy<br>poverty in<br>households with<br>vulnerable<br>electricity<br>consumers|Col3|energy<br>performance|Col5|Col6|Col7|Col8|Col9|Col10|average at least a 30% primary energy<br>demand reduction.|
|---|---|---|---|---|---|---|---|---|---|---|
|31b|C6.1I2 Scaled-<br>up measure:<br>Encouraging the<br>use of<br>renewables and<br>energy savings<br>by local/wider<br>public<br>authorities|Target|Reduced<br>primary energy<br>consumption<br>due to<br>investments<br>undertaken by<br>local and wider<br>public<br>authorities,<br>improving<br>their energy<br>performance|-|MWh /<br>year|3 600|4 000|Q4|2024|Investments undertaken by local and wider<br>public authorities have improved their<br>energy performance due to the financial<br>support provided and have achieved a<br>primary energy consumption reduction of<br>at least 4 000 MWh per year.|
|32b|C6.1I2 Scaled-<br>up measure:<br>Encouraging the<br>use of<br>renewables and<br>energy savings<br>by local/wider<br>public<br>authorities|Target|Reduced<br>primary energy<br>consumption<br>due to<br>investments<br>undertaken by<br>local and wider<br>public<br>authorities,<br>improving<br>their energy<br>performance|-|MWh /<br>year|11 250|25 000|Q2|2026|Investments undertaken by local and wider<br>public authorities have improved their<br>energy performance due to the financial<br>support provided and have achieved a<br>primary energy consumption reduction of<br>at least 25 000 MWh per year.|

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|274|C6.1I3<br>Promoting<br>extensive energy<br>upgrading of<br>housing stock|Milestone|Support<br>scheme<br>promoting<br>extensive<br>energy<br>upgrading of<br>housing stock|Publication of<br>call for<br>proposals for<br>the support<br>scheme|-|-|-|Q1|2024|Publication of the call for proposals for the<br>support scheme for promoting extensive<br>energy upgrading of housing stock,<br>following Council of Ministers decision<br>approving the scheme objectives. The<br>investment shall aim at achieving at least a<br>30% primary energy demand reduction.|
|---|---|---|---|---|---|---|---|---|---|---|
|275|C6.1I3<br>Promoting<br>extensive energy<br>upgrading of<br>housing stock|Target|Households<br>being energy<br>renovated,<br>improving<br>their energy<br>performance|-|Number|0|1100|Q2|2026|Award of grants to at least 1100<br>households which shall be energy<br>renovated, improving their energy<br>performance, due to the support provided<br>with an objective to achieve at least a 30%<br>primary energy demand reduction.|
|62b|C6.1I4 Scaled-<br>up measure:<br>Promote<br>widespread use<br>of Electric<br>Vehicles (EVs)|Target|Purchase of<br>electric<br>vehicles,<br>electric<br>bicycles due to<br>the support<br>granted|-|Number|1 523|2 300|Q4|2024|Due to the support granted by the support<br>scheme, at least 2 300 electric vehicles of<br>categories M1, M2-3, N, L1e-L7e and<br>bicycles have been purchased.|
|63b|C6.1I4 Scaled-<br>up measure:<br>Promote<br>widespread use<br>of Electric<br>Vehicles (EVs)|Target|Purchase of<br>electric<br>vehicles,<br>electric<br>bicycles due to<br>the support<br>granted|-|Number|4335|5 800|Q2|2026|Due to the support granted by the support<br>scheme, at least 5 800 electric vehicles of<br>categories M1, M2-3, N, L1e-L7e and<br>bicycles have been purchased.|

154

|101b|C6.1I5 Scaled-<br>up measure:<br>Scheme for the<br>enhancement of<br>the<br>competitiveness<br>and the energy<br>efficiency of<br>large enterprises<br>in Cyprus|Target|Grants to large<br>enterprises|-|Number|0|3|Q4|2024|Award of grants to at least three (3) large<br>enterprises, in all sectors, to improve their<br>energy performance. All the projects<br>selected shall be in compliance with the ‘Do<br>no significant harm’ Technical Guidance<br>(2021/C58/01) through the use of an<br>exclusion list and the requirement of<br>compliance with the relevant EU and<br>national environmental legislation.|
|---|---|---|---|---|---|---|---|---|---|---|
|102b|C6.1I5 Scaled-<br>up measure:<br>Scheme for the<br>enhancement of<br>the<br>competitiveness<br>and the energy<br>efficiency of<br>large enterprises<br>in Cyprus|Target|Grants to large<br>enterprises|-|Number|3|12|Q2|2026|Award of grants to at least twelve (12)<br>large enterprises, in all sectors, to improve<br>their energy performance. All the projects<br>selected shall be in compliance with the<br>‘Do no significant harm’ Technical<br>Guidance (2021/C58/01) through the use<br>of an exclusion list and the requirement of<br>compliance with the relevant EU and<br>national environmental legislation.|
|131b|C6.1I6 Scaled-<br>up measure:<br>Thematic<br>research and<br>innovation<br>funding program<br>on green<br>transition|Target|Organisations<br>supported<br>by<br>grants on green<br>transition R&I<br>activities|-|Number|10|20|Q2|2026|At least 20 organisations supported by<br>grants on green transition R&I activities, in<br>compliance with the ’Dono significant<br>harm’ Technical Guidance (2021/C58/01)<br>through the use of an exclusion list and the<br>requirement of compliance with the<br>relevant EU and national environmental<br>legislation.|
|276|C6.1I7<br>Thematic|Milestone|Signature<br>of<br>grant|Grant<br>agreements|-|-|-|Q3|2024|Signing of grant agreements for R&I<br>funding program on energy production,|

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|Col1|research in<br>enterprises for<br>energy<br>production,<br>storage,<br>transmission and<br>distribution<br>solutions|Col3|agreements for<br>the whole<br>budget|signed by the<br>Director of the<br>Research and<br>Innovation<br>Foundation|Col6|Col7|Col8|Col9|Col10|storage, transmission and distribution<br>solutions R&I activities, with terms of<br>reference including eligibility criteria that<br>ensure that the selected projects comply<br>with the ‘Do no significant harm’ Technical<br>Guidance (2021/C58/01) through the use of<br>an exclusion list and the requirement of<br>compliance with the relevant EU and<br>national environmental legislation.|
|---|---|---|---|---|---|---|---|---|---|---|
|277|C6.1I7<br>Thematic<br>research in<br>enterprises for<br>energy<br>production,<br>storage,<br>transmission and<br>distribution<br>solutions|Target|Organisations<br>supported by<br>grants on<br>energy<br>production,<br>storage,<br>transmission<br>and<br>distribution<br>solutions R&I<br>activities|-|Number|0|20|Q2|2026|At least 20 organisations supported by<br>grants on energy production, storage,<br>transmission and distribution solutions<br>R&I activities, in compliance with the ’Do<br>no significant harm’ Technical Guidance<br>(2021/C58/01) through the use of an<br>exclusion list and the requirement of<br>compliance with the relevant EU and<br>national environmental legislation.|

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**O.** **COMPONENT** **7.1:** **A** **UDIT AND CONTROL**

This component aims to ensure that the control framework of the Cypriot Recovery and Resilience
Plan prevents, detects and corrects corruption, fraud and conflicts of interests when using the funds
provided under the Recovery and Resilience Facility Regulation (RRF Regulation), as well as
ensuring adequate arrangements to effectively avoid double funding under the RRF Regulation and
other Union programmes.

**-**
**O.1. Description of the reforms and investments for non** **repayable financial support**

Reform 1 (C7.1R1): Arrangements for the control framework of the Recovery and Resilience Plan

The objective of the measure is to improve the control framework of the Cypriot Recovery and
Resilience Plan. To ensure an effective implementation of proportionate measures for the protection
of the financial interests of the Union (PFIU) according to the Article 22 of the RRF Regulation,

The Council of Ministers shall adopt mandatory instructions prepared by the Coordination Authority
and distributed upon their adoption to all relevant bodies.

The milestone under this measure shall be fulfilled by the time of submission of the next payment
request to the Commission following the adoption of this Implementing Decision and shall be a
prerequisite for any future payment .

The reform shall be completed by 31 December 2023.

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**O.2. Milestones, targets, indicators, and timetable for monitoring and implementation for non-repayable financial support**

|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|278|C7.1R1<br>Arrangements<br>for the control<br>framework of<br>the Recovery<br>and Resilience<br>Plan|Milestone|Clear<br>delimination<br>between<br>control and<br>implementati<br>on duties|Adopted<br>instructions and<br>proof of<br>dissemination to<br>all<br>Implementing<br>Bodies.|-|-|-|Q4|2023|The Council of Ministers shall adopt mandatory<br>instructions prepared by the Coordinating<br>Authority which shall cover at least the<br>following areas:<br>• <br>The risk assessment methodology to be<br>applied for all verification types<br>(administrative and on the spot),<br>• <br>Verifications for double funding and<br>procedures for its avoidance,<br>• <br>The treatment of irregularities and the<br>whistle blowing process followed for<br>interventions (projects or schemes) funded<br>by the Union,<br>• <br>Requirements for audit trail;<br>• <br>A central fraud risk assessment for all<br>contracting authorities, taking into<br>consideration all the elements outlined in<br>the Guidance Note on Fraud Risk<br>Assessment and Effective and<br>Proportionate Anti-Fraud Measures for<br>ESIF 2014-2020. Each contracting<br>authority functioning under the RRP is<br>mandated to comply with the action plan<br>devised by the central fraud risk<br>assessment team.<br>• <br>Establishment of specific functions for<br>PFIU, dedicated to tackling issues related<br>to fraud, corruption, and conflicts of|

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|Sequential<br>Number|Related<br>Measure<br>(Reform or<br>Investment)|Milestone /<br>Target|Name|Qualitative<br>indicators<br>(for milestones)|Quantitative indicators<br>(for targets)|Col7|Col8|Indicative<br>timeline for<br>completion|Col10|Description of each milestone|
|---|---|---|---|---|---|---|---|---|---|---|
|**Sequential**<br>**Number**|**Related**<br>**Measure**<br>**(Reform or**<br>**Investment)**|**Milestone /**<br>**Target**|**Name**|**Qualitative**<br>**indicators** <br>**(for milestones)**|**Unit of**<br>**measure**|**Baseline**|**Goal**|**Quarter**|**Year**|**Year**|
|||||||||||interest in Implementing Bodies<br>implementing aid schemes under the RRP.<br> <br>The instructions shall be distributed to all entities<br>involved in the implementation, monitoring and<br>control of the RRP and shall clearly segregate<br>their responsibilities, ensuring a clear separation<br>between control and implementation duties and<br>shall require that controls are conducted in<br>alignment with them.|

159

**2.** **Estimated total cost of the recovery and resilience plan**

The estimated total cost of the recovery and resilience plan of Cyprus is EUR 1 220 971 974.

The estimated total costs of the REPowerEU chapter is EUR 104 580 000. In particular, the
estimated total costs of the measures referred to in Article 21c(3), point (a) of Regulation
(EU) 2023/435 is EUR 0 whilst the costs of the other measures in the REPowerEU chapter

is EUR 104 580 000.

**SECTION** **2:** **FINANCIAL** **SUPPORT**

**1.** **Financial contribution**

The instalments referred to in Article 2(2) shall be organised in the following manner:

1.1. First Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|21 <br>|C2.1R2<br>Independence of Cyprus Transmission System<br>Operator (TSOC) from the incumbent Electricity<br>Authority of Cyprus|Milestone|Law for the<br>Regulation of the<br>Electricity Market<br>of 2021|
|23 <br>|C2.1R4<br>Energy Storage Regulatory Framework|Milestone|Amendment of the<br>Transmission and<br>Distribution Rules<br>(TDRs) and<br>Trading and<br>Settlement Rules<br>(TSRs)|
|24|C2.1I1<br>Promoting energy efficiency investments in SMEs<br>and non-profit organisations|Milestone|Support scheme<br>for Promoting<br>energy efficiency<br>investments in<br>SME and non-<br>profit<br>organisations|
|27|C2.1I2<br>Promoting renewables and individual energy<br>efficiency measures in dwellings and tackling<br>energy poverty in households with vulnerable<br>electricity consumers|Milestone|First call for<br>proposals for<br>Promoting<br>renewables and<br>individual energy<br>efficiency<br>measures in<br>dwellings|
|30|C2.1I3<br>Encouraging the use of renewables and energy<br>savings by local/wider public authorities and<br>facilitating the transition of local communities<br>towards climate mitigation & adaptation|Milestone|First call for<br>proposals to<br>support local<br>authorities in<br>energy efficiency<br>measures|

160

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|93|C3.1I2<br>Enhancement of isotopic database of traditional<br>Cypriot products.|Milestone|Liquid<br>Chromatography-<br>Isotopic Ratio<br>Mass<br>Spectrometer (LC-<br>IRMS) equipment|
|109|C3.1R4<br>Enhancement of circular economy in the Industry|Milestone|Approval of the<br>National Action<br>Plan for the<br>Enhancement of<br>Circular Economy<br>in Cyprus|
|160|C3.4R3<br>Introduce new framework for evaluation and<br>selection process for filling public service<br>vacancies and new regulations for the evaluation<br>of employees’ performance|Milestone|Entry into force of<br>legislation for the<br>evaluation and<br>selection process<br>for public service<br>vacancies and<br>regulations for<br>employees’<br>performance<br>evaluation.|
|186|C3.4I8<br>Upgrading the infrastructure of courts|Milestone|Extension of the<br>Famagusta District<br>Court|
|188|C3.4R10<br>Improving the legal and institutional framework<br>for fighting corruption|Milestone|Entry into force of<br>the law on<br>Transparency in<br>Decision-Making<br>and Related<br>Matters|
|189|C3.4R10<br>Improving the legal and institutional framework<br>for fighting corruption|Milestone|Entry into force of<br>the law to protect<br>whistle-blowers|
|192|C3.5R2 <br>Framework and Action Plan for addressing NPLs|Milestone|Entry into force of<br>the package of<br>amending laws<br>regarding credit<br>acquiring<br>companies (CAC)<br>and credit<br>servicers to<br>improve the<br>working<br>environment for<br>non-performing<br>loans management|

161

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|232|C4.2I1<br>Digitalisation in various Central Government<br>Ministries– Services|Milestone|Repository system<br>for audit and<br>control:<br>information for<br>monitoring<br>implementation of<br>RRF|
|249|C5.1R5<br>E-skills Action Plan– Implementation of specific<br>actions|Milestone|National e-Skills<br>Action Plan is<br>adopted by the<br>Council of<br>Ministers|
|||Instalment<br>Amount|EUR 97 701 149|

1.2. Second Instalment (non-repayable support) :

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|7 <br>|C1.1I2<br>Cyprus Innovative Public Health information and<br>communications technology (ICT) System|Milestone|Influenza Sentinel<br>Surveillance<br>(ISS)System|
|35|C2.1I5<br>Energy Efficiency Upgrading of public buildings|Target|Thermal insulation<br>and photovoltaic<br>systems installed<br>in schools|
|||||
|45|C2.1I9<br>Forests fire protection|Milestone|Signing of 8<br>Agreements/<br>Contracts<br>Signatures for the<br>purchase of<br>vehicles,<br>equipment and<br>provision of<br>services and issue<br>of call for tenders<br>for the purchase of<br>firefighting<br>aircraft|

162

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|71|C2.3I3<br>Integrated Monitoring and Control Management<br>System for the Water Development Department’s<br>infrastructure|Milestone|Completion of the<br>detailed<br>requirements<br>analysis and<br>system design<br>document|
|87|C3.1R2<br>On-line platform for improving the trade and<br>information symmetry in the fresh produce supply<br>chain|Milestone|Law on unfair<br>practices in<br>transactions in the<br>local fresh<br>produce market|
|97|C3.1I5<br>Creation of a National Commercial Identity and<br>promotion of the traditional product “halloumi”|Milestone|Action Plans for<br>(a) the “made in<br>Cyprus” branding,<br>and (b) for the<br>promotion of the<br>halloumi cheese|
|105|C3.1I9<br>Promotion of circular economy in hotel<br>establishments|Target|Coaching scheme<br>for circular<br>economy|
|122|C3.2R2<br>Incentives for investments and human capital in<br>R&I|Milestone|Tax exemption of<br>legal entities for<br>investing in<br>innovative<br>companies|
|125|C3.2I1<br>Set up and operate a central Knowledge Transfer<br>Office (KTO)|Milestone|Launch of KTO|
|134|C3.3R1<br>Facilitation of Strategic investments|Milestone|Law for strategic<br>investments|
|155|C3.4R1<br>Enhance the administrative capacity and improve<br>the functioning of public administration for better<br>policy making and implementation|Milestone|Action Plan on the<br>efficient<br>management of<br>human resource<br>issues in the<br>national public<br>administration<br>|
|187|C3.4R10<br>Improving the legal and institutional framework<br>for fighting corruption|Milestone|Entry into force of<br>the law<br>establishing the<br>Independent<br>Authority against<br>Corruption|
|207a|C3.5R9 <br>Improving tax collection and effectiveness of the<br>Tax Department|Milestone|Operation of VAT<br>Services within an<br>Integrated Tax<br>Administration<br>System (ITAS)|

163

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|214|C4.1R1<br>Empower the National Regulatory Authority<br>(OCECPR)|Milestone|Launch of the<br>geographical<br>survey and entry<br>into force of<br>secondary<br>legislation|
|233|C4.2I1<br>Digitalisation in various Central Government<br>Ministries– Services|Target|Start of the digital<br>upgrade of a<br>number of central<br>government<br>ministries and<br>departments|
|278|C7.1R1<br>Arrangements for the control framework of the<br>Recovery and Resilience Plan|Milestone|Clear delimitation<br>between control<br>and<br>implementation<br>duties|
|||Instalment<br>Amount|EUR 87 136 829|

1.3. Third Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|5 <br>|C1.1I1<br>New facilities for the Cyprus Blood Establishment<br>and procurement of the latest technology attendant<br>equipment|Milestone|Contract signature<br>for the<br>construction of the<br>Cyprus Blood<br>Establishment|
|22|C2.1R3<br>Digital One-Stop Shops to streamline RES<br>projects permitting and to facilitate Energy<br>Renovation in Buildings|Milestone|Fully operational<br>IT platform|
|77a|C2.3I5<br>Anti-flood and water collection measures|Milestone|Completion of<br>construction<br>works of drainage<br>network and<br>reconstruction of<br>streets and<br>pavements in areas<br>of Nicosia|

164

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|85|C3.1R1<br>Move agricultural practices from the 20th century<br>to the 21st century by investing in a national centre<br>for excellence in agri-tech|Milestone|Cooperation<br>between the<br>Agricultural<br>Research Institute<br>and public<br>universities, for<br>joint MSc and<br>PhD programmes|
|95|C3.1I3<br>Upskill existing and future farmers|Target|Scholarships<br>granted|
|120|C3.2R1<br>National R&I Policy and policy tools|Milestone|Adoption of the<br>national R&I<br>Strategy and of the<br>Action Plan to<br>implement it|
|123|C3.2R3<br>Policies to foster access to publicly funded<br>research infrastructure and laboratories|Milestone|Digital registry to<br>record and publish<br>research<br>infrastructure|
|127|C3.2I2<br>Innovation funding programmes for start-ups,<br>innovative companies and SMEs|Milestone|Signature of grant<br>agreements for<br>50% of budget|
|130|C3.2I3<br>R&I funding program on green transition|Milestone|Signature of grant<br>agreements for a<br>R&I funding<br>programme of<br>EUR 6 mln budget<br>|
|136|C3.3R2<br>Enhancing Fast-Track Business Activation<br>Mechanism|Milestone|Establishment of<br>an electronic<br>system where<br>investors can<br>submit their online<br>application|
|143|C3.3R6<br>Incentives to promote mergers and acquisitions.|Milestone|Action Plan for<br>incentives for<br>mergers and<br>acquisitions|
|151|C3.3I6<br>State funded equity fund|Milestone|Setup of the Fund|
|173|C3.4I4<br>Enhancing e-system for issuing building permits|Milestone|Enhancement of<br>the e-application<br>environment of the<br>Hippodamos<br>System|
|194|C3.5R3<br>Strategy for addressing inadequacies of the<br>property transaction system (title deeds)|Milestone|Extension of the<br>New Planning and<br>Building Permit<br>Policy|

165

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|195|C3.5R3<br>Strategy for addressing inadequacies of the<br>property transaction system (title deeds)|Milestone|Entry into force of<br>the amendment of<br>the Sale of<br>Property (Specific<br>Performance) Law|
|199|C3.5R5<br>Action plan for the development of a liability<br>monitoring register|Milestone|Action Plan for<br>the development<br>of a liability<br>monitoring<br>register|
|201|C3.5R6 <br>Reinforcing and strengthening the insolvency<br>framework|Milestone|Full<br>implementation<br>and full operation<br>of the legal and<br>institutional<br>framework for<br>insolvency|
|209|C3.5R10 <br>Addressing Aggressive Tax Planning|Milestone|Entry into force of<br>the law to tackle<br>aggressive tax<br>planning|
|224|C4.2R1<br>Digital Services Factory|Milestone|Definition of the<br>Service Delivery<br>Model for the<br>Digital Services<br>Factory|
|251|C5.1I1<br>Construction of one Model Technical School|Milestone|Contract for the<br>construction of<br>one Technical<br>School|
|266|C5.2I4<br>Child Centres in Municipalities|Target|Construction of at<br>least one child<br>centre|
|268|C5.2I5<br>Construction of Two Model Special Education<br>Schools|Milestone|Signing of<br>contract with the<br>selected tenderer<br>(contractor)|
|||Instalment<br>Amount|EUR 103 036 204|

166

1.4. Fourth Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|3 <br>|C1.1R2<br>Design of an Electronic platform for the<br>surveillance of Nosocomial Antibiotic<br>Consumption and Healthcare– Associated<br>Infections|Milestone|Adoption of the<br>list of health care<br>facilities|
|43|C2.1I8<br>Monitoring and reduction of GHG emissions in<br>agriculture|Milestone|Purchase and<br>installation of<br>monitoring units<br>for measuring<br>GHG emissions<br>from agriculture|
|48|C2.1I10<br>Market Management System to facilitate the<br>opening of the electricity market to competition|Milestone|Completion,<br>installation and<br>roll-out of the<br>Market<br>Management<br>System and<br>training of<br>personnel|
|74a|C2.3I4<br>Smart Water and Sewerage Networks<br>Management|Target|Delivery and<br>installation of<br>photovoltaics at<br>the Larnaca<br>Wastewater<br>Treatment Plant|
|86|C3.1R1<br>Move agricultural practices from the 20th century<br>to the 21st century by investing in a national centre<br>for excellence in agri-tech|Milestone|New joint Masters<br>and/or PhDs in the<br>wider domain of<br>Agriculture|
|132|C3.2I4<br>Funding to organisations performing R&D<br>activities on dual technologies|Milestone|Signing of grant<br>agreements which<br>commit 80% of<br>total budget for<br>funding to<br>organisations<br>performing R&D<br>activities on dual<br>technologies|
|135|C3.3R1<br>Facilitation of Strategic investments|Milestone|Organisational<br>capacity’s<br>enhancement for<br>the facilitation of<br>strategic<br>investments|

167

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|140|C3.3R4<br>Design and establish a National Promotional<br>Agency|Milestone|Approval by the<br>Council of<br>Ministers of the<br>roadmap for the<br>creation and<br>establishment of a<br>National<br>Promotional<br>Agency|
|147|C3.3I4<br>Scheme for the digital upgrade of enterprises|Milestone|Publication of call<br>for proposals<br>following<br>approval of the<br>scheme by the<br>Council of<br>Ministers|
|158|C3.4R2<br>Regulate flexible working arrangements in the<br>public sector|Milestone|Decision on<br>flexible working<br>arrangements in<br>the public sector|
|193|C3.5R3<br>Strategy for addressing inadequacies of the<br>property transaction system (title deeds)|Target|Reduction of<br>backlog of cases<br>for issuance of<br>title deeds either<br>by issuing title<br>deeds or by<br>rejecting the case|
|197|C3.5R4<br>New legal framework and system of exchange of<br>data and credit bureau|Milestone|Entry into force of<br>the framework and<br>system of<br>exchange of data<br>legislation|
|220|C4.1I2<br>Upgrade internet connection to be “Gigabit-ready”<br>and promote connectivity take-up|Target|Expansion of<br>Gigabit-ready<br>internet<br>connection take-<br>up by households|
|229|C4.2R3<br>Police Procedures digitalisation on Digipol|Milestone|Digipol prototype<br>operational|
|236|C4.2I2<br>Digitalisation of the Cyprus Ports Authority|Target|Start of the digital<br>upgrade of the<br>Cyprus Ports<br>Authority|
|255|C5.2R2<br>Flexible Work Arrangements in the Form of<br>Telework|Milestone|Entry into force of<br>the law for<br>flexible work<br>arrangements in<br>the form of<br>telework|

168

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|||Instalment<br>Amount|EUR 89 251 156|

169

1.5. Fifth Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|9 <br>|C1.1I3<br>Purchase/replacement of medical equipment in<br>hospitals|Target|Health institutions<br>having benefitted from<br>the financial support<br>scheme|
|13 <br>|C1.1I6<br>Deployment of generic cross border e-health<br>services in Cyprus|Milestone|Completion of the<br>analysis, design and<br>development phase of<br>the IT System for cross-<br>border e-health services|
|28a|C2.1I2<br>Promoting renewables and individual energy<br>efficiency measures in dwellings and tackling<br>energy poverty in households with vulnerable<br>electricity consumers|Target|Dwellings and<br>households with<br>vulnerable electricity<br>consumers (including<br>people with disabilities)<br>having improved their<br>energy performance|
|36|C2.1I5<br>Energy Efficiency Upgrading of public buildings|Target|Completion of set up and<br>installation of<br>photovoltaics system at<br>the Nicosia General<br>Hospital|
|38|C2.1I6<br>Upgrading renewable energy and smart grids<br>testing infrastructure at the University of Cyprus|Milestone|Signature of contracts<br>for the installation of<br>equipment to upgrade<br>the electricity grid into a<br>smart grid|
|55|C2.2R3<br>Progressively phase out the most polluting<br>vehicles, especially in polluted urban areas|Milestone|Entry into force of the<br>legislative/administrative<br>acts related to the<br>phasing out of the most<br>polluting vehicles|
|67|C2.3I1<br>Choirokitia‑ Famagusta Conveyor Replacement|Milestone|Preparation of tender<br>documents and issue call<br>for tenders|
|89|C3.1R3<br>Genetic improvement of the Cyprus sheep and<br>goat population|Target|Upgrade of record<br>keeping in farms and<br>participation of farmers<br>in AGRICYGEN project|
|100|C3.1I7<br>Scheme for the enhancement of the<br>competitiveness and/or the energy efficiency of<br>large enterprises in Cyprus|Milestone|Start of the grant scheme<br>on large enterprises|
|112|C3.1I12<br>Waste management towards circular economy|Milestone|Signature of the contract<br>for the installation of<br>Green kiosks|
|128|C3.2I2<br>Innovation funding programmes for start-ups,<br>innovative companies and SMEs|Target|Organisations supported<br>to carry out R&I related<br>activities|

170

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|156|C3.4R1<br>Enhance the administrative capacity and improve<br>the functioning of public administration for better<br>policy making and implementation|Milestone|New human resources<br>management framework<br>for Cyprus Police|
|163|C3.4R5<br>Enhancement of the capacity of the Law Office|Milestone|New IT system for the<br>Law Office|
|167|C3.4I3<br>Economic Policy Modelling Hub|Milestone|Setting up a Modelling<br>Hub for Economic<br>Policy Analysis|
|180|C3.4R8<br>Efficiency of Justice|Milestone|Entry into force of new<br>Rules of Civil Procedure|
|191|C3.5R1 <br>Completing the legal framework for Crisis<br>Management for Credit Institutions|Milestone|Entry into force of the<br>amendment of the<br>national insolvency<br>framework for credit<br>institutions, and<br>introduction of<br>government tools for<br>preservation of financial<br>stability|
|196|C3.5R3<br>Strategy for addressing inadequacies of the<br>property transaction system (title deeds)|Milestone|Review of the Streets<br>and Building Regulation|
|203|C3.5R7<br>Strategy for Combating Financial Illiteracy|Milestone|Strategy for Combating<br>Financial Illiteracy|
|205|C3.5R8 <br>Enhancing supervision of Insurance and Pension<br>Funds|Milestone|Supervisory tools<br>including data collection<br>and analysis tool|
|206|C3.5I1 <br>Enhancement of the Supervisory Function of the<br>Cyprus Securities and Exchange Commission|Milestone|Digital system for<br>supervision of<br>transactions for the<br>Cyprus Securities and<br>Exchange Commission|
|207b|C3.5R9 Improving tax collection and<br>effectiveness of the Tax Department|Milestone|Purchase of the new<br>building for the<br>integrated Nicosia<br>District Office and Large<br>Taxpayers’ Office|
|212|C3.5I2 Modernisation of Customs and Electronic<br>Payment System|Target|Putting into operation<br>the information systems– <br>envisaged under the<br>Union Customs Code<br>(UCC)|
|217|C4.1I1<br>Expansion of Very High Capacity Networks in<br>underserved areas|Milestone|Start of very high<br>capacity networks’<br>deployment in<br>underserved areas|
|225|C4.2R1<br>Digital Services Factory|Target|Expansion of delivery of<br>government services<br>online through the<br>Digital Services Factory|

171

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|231|C4.2R4<br>Setting up the beneficial ownership registry|Milestone|Beneficial ownership<br>registry available for use|
|241|C5.1R2<br>A new teacher and school evaluation system|Milestone|Entry into force of the<br>law for establishing a<br>new Teacher and School<br>Evaluation mechanism|
|243|C5.1R3<br>Gradual extension of free compulsory pre-primary<br>education from the age of four|Milestone|Entry into force of the<br>new Law regarding the<br>gradual extension of free<br>compulsory pre-primary<br>education from the age<br>of four years and<br>adoption of aid schemes<br>by the Council of<br>Ministers|
|28b|C6.1I1 Scaled-up measure: Promoting renewables<br>and individual energy efficiency measures in<br>dwellings and tackling energy poverty in<br>households with vulnerable electricity consumers|Target|Dwellings and<br>households with<br>vulnerable electricity<br>consumers having<br>improved their energy<br>performance|
|||Instalment<br>Amount|EUR 139 544 839|

172

1.6. Sixth Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|19|C2.1R1<br>Green Taxation|Milestone|Entry into force of<br>a law introducing<br>a carbon tax for<br>fuels, a levy on<br>water and a charge<br>on household/<br>landfill waste|
|40<br>|C2.1I7<br>Mass installation and operation by the Distribution<br>System Operator (DSO) of Smart Metering<br>Infrastructure (Advanced Metering Infrastructure)|Milestone|Contract Signature<br>for smart<br>electricity<br>metering<br>infrastructure|
|52|C2.2R1<br>Establishment of an Intelligent Transport System<br>using Digital Twin technologies|Target|Delivery and<br>installation of at<br>least 150 sensors|
|57|C2.2I1<br>Implementation of Sustainable Urban Mobility<br>Projects (SUMP) and accessibility enhancing<br>measures|Milestone|Contracts<br>signature for the<br>construction work<br>of sustainable<br>transport<br>infrastructure and<br>ancillary<br>installations|
|69a|C2.3I2<br>Water Treatment Plants: upgrade for water quality<br>improvement|Milestone|Completion of the<br>works for the<br>installation of<br>activated carbon<br>polishing units  in<br>Tersefanou,<br>Asprokremmos<br>and Limassol<br>Water Treatment<br>Plants|
|72|C2.3I3<br>Integrated Monitoring and Control Management<br>System for the Water Development Department’s<br>infrastructure|Target|Delivery and<br>installation of at<br>least 50% of the<br>equipment|
|78|C2.3I5<br>Anti-flood and water collection measures|Milestone|Completion of<br>construction<br>works for the<br>rainwater<br>collection and<br>recycling system<br>in Kladeri area|
|80|C2.3I6<br>Enhance water security for Nicosia and Larnaca<br>regions|Target|Completion of<br>construction of<br>two glass lined<br>steel reservoirs|

173

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|103|C3.1I8<br>Enhancing the added value of the tourism sector<br>with emphasis on the country side, mountainous<br>and remote areas|Target|Grant to SMEs to<br>promote the<br>tourism sector|
|144|C3.3I2<br>Creation of a Regulatory Sandbox to enable<br>FinTech|Milestone|Regulatory<br>Sandbox with a<br>view on FinTech<br>and innovative<br>technologies|
|169|C3.4R6<br>New legal framework for Local Authorities and<br>relevant support measures|Milestone|New legal<br>framework on<br>local authorities|
|171|C3.4R7<br>Urban land consolidation|Milestone|Entry into force of<br>the law on urban<br>land consolidation|
|181|C3.4R8<br>Efficiency of Justice|Target|Reducing the<br>backlog of cases<br>and appeals|
|183|C3.4R9<br>Digital transformation of courts|Milestone|e-justice system|
|208|C3.5R9 <br>Improving tax collection and effectiveness of the<br>Tax Department|Milestone|Integration of<br>operations of the<br>direct tax<br>administration<br>department within<br>the ITAS|
|216|C4.1R2<br>Empower the National Broadband Competence<br>Office (DEC of the DMRIDP)|Milestone|Entry into force of<br>the administrative<br>acts for very high<br>capacity networks’<br>deployment|
|246a|C5.1R4<br>Digital transformation of school units with the aim<br>of enhancing digital skills and skills related to<br>STEM education|Target|Classrooms<br>digitally equipped|
|274|C6.1I3  Promoting extensive energy upgrading of<br>housing stock|Milestone|Publication of call<br>for proposals for<br>the support<br>scheme|
|||Instalment<br>Amount|EUR 92 274 759|

174

1.7. Seventh Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|1 <br>|C1.1R1<br>National Centre for Clinical Evidence and Quality<br>Improvement|Target|Clinical protocols<br>prepared, audited<br>and peer reviewed<br>|
|25|C2.1I1<br>Promoting energy efficiency investments in SMEs<br>and non-profit organisations|Target|Entities (SMEs,<br>non-profit<br>organisations)<br>having<br>implemented<br>energy efficiency<br>interventions|
|31a<br>|C2.1I3<br>Encouraging the use of renewables and energy<br>savings by local/wider public authorities and<br>facilitating the transition of local communities<br>towards climate mitigation & adaptation|Target|Investments<br>undertaken by<br>local and wider<br>public authorities<br>that have<br>improved their<br>energy<br>performance|
|33|C2.1I4<br>Encourage the reduction of CO2 emissions in<br>businesses|Target|Undertakings<br>having developed<br>their GHG<br>emissions<br>reduction action<br>plans|
|39|C2.1I6<br>Upgrading renewable energy and smart grids<br>testing infrastructure at the University of Cyprus|Milestone|Delivery,<br>successful<br>installation and<br>acceptance of the<br>equipment for<br>smart grids|
|41|C2.1I7<br>Mass installation and operation by the Distribution<br>System Operator (DSO) of Smart Metering<br>Infrastructure (Advanced Metering Infrastructure)|Target|Delivery and<br>installation of<br>smart meters|
|54|C2.2R2<br>Provide the regulatory framework for an<br>interoperable and effective electric vehicle (EV)<br>recharging infrastructure and an efficient EV<br>recharging market|Milestone|Entry into force of<br>legislation related<br>to electric vehicle<br>charging points|
|60|C2.2I2<br>Creation of electro-mobility infrastructure|Target|Installation of at<br>least 330 charging<br>points, due to the<br>support granted|
|62a|C2.2I3<br>Promote widespread use of Electric Vehicles<br>(EVs)|Target|Purchase of<br>electric vehicles,<br>electric bicycles,<br>due to the support<br>granted|

175

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|64|C2.2I3<br>Promote widespread use of Electric Vehicles<br>(EVs)|Target|Scrapping of high<br>emission vehicles,<br>due to the support<br>granted|
|75|C2.3I4<br>Smart Water and Sewerage Networks<br>Management|Target|Delivery and<br>installation of at<br>least 200 quality<br>and pressure<br>sensors|
|98|C3.1I6<br>Scheme for modernisation and digitalisation of<br>enterprises engaged in manufacturing and trading<br>of agricultural products|Target|Grants to SMEs<br>engaged with trade<br>and production of<br>agricultural<br>products|
|101a|C3.1I7<br>Scheme for the enhancement of the<br>competitiveness and/or the energy efficiency of<br>large enterprises in Cyprus|Target|Grants to large<br>enterprises|
|107|C3.1I10<br>Enrichment of the tourism product in rural,<br>mountainous and remote areas|Milestone|Aphrodite Route|
|124|C3.2R3<br>Policies to foster access to publicly funded<br>research infrastructure and laboratories|Milestone|Collaboration of<br>Research<br>Performing<br>Organisations with<br>business and spin-<br>offs|
|142|C3.3R5<br>Strategic Investor of the Cyprus Stock Exchange|Milestone|Selection of a<br>strategic investor<br>to buy a<br>controlling stake<br>in Cyprus Stock<br>Exchange|
|159|C3.4R2<br>Regulate flexible working arrangements in the<br>public sector|Milestone|Implementation of<br>flexible working<br>arrangements|
|170|C3.4R6<br>New legal framework for Local Authorities and<br>relevant support measures|Target|Number of local<br>authority staff<br>participating in<br>capacity building|
|174|C3.4I4<br>Enhancing e-system for issuing building permits|Milestone|Enhancement of<br>planning and<br>control and project<br>management<br>functionalities of<br>Hippodamos|
|177|C3.4I6<br>Regeneration and Revitalisation of Nicosia Inner<br>City|Target|Rooms renovated<br>and converted to<br>student dorms|

176

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|198|C3.5R4<br>New legal framework and system of exchange of<br>data and credit bureau|Milestone|Upgraded digital<br>system of<br>exchange of data<br>and credit bureau|
|200|C3.5R5<br>Action plan for the development of a liability<br>monitoring register|Milestone|Action plan for the<br>development of a<br>liability<br>monitoring<br>register|
|210|C3.5R10 <br>Addressing Aggressive Tax Planning|Milestone|Entry into force of<br>the law to tackle<br>aggressive tax<br>planning via<br>payments to low<br>tax jurisdictions|
|215|C4.1R1<br>Empower the National Regulatory Authority<br>(OCECPR)|Milestone|The web portal on<br>broadband and<br>infrastructure<br>mapping is<br>operational and<br>accessible to the<br>target audience|
|218|C4.1I1<br>Expansion of Very High Capacity Networks in<br>underserved areas|Target|Expansion of very<br>high capacity<br>networks’<br>deployment in<br>underserved areas|
|227|C4.2R2<br>Definition and implementation of a new cloud<br>policy with regard to government IT systems and<br>services|Milestone|The government<br>cloud (G-cloud) is<br>operational|
|234|C4.2I1<br>Digitalisation in various Central Government<br>Ministries - Services|Target|Advancement of<br>the digital upgrade<br>of a number of<br>central<br>government<br>ministries and<br>departments|
|237|C4.2I2<br>Digitalisation of the Cyprus Ports Authority|Target|Advancement of<br>the digital upgrade<br>of the Cyprus<br>Ports Authority|
|239a|C5.1R1<br>Addressing skills mismatch between education<br>and labour market (Secondary and Higher<br>Education)|Milestone|Implementation of<br>key measures from<br>the National<br>Action Plan|

177

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|247|C5.1R4<br>Digital transformation of school units with the aim<br>of enhancing digital skills and skills related to<br>STEM education|Target|Curriculum<br>transformation and<br>production of<br>educational<br>material for digital<br>skills and STEM<br>methodology|
|253|C5.1I2<br>Skilling, Reskilling and Upskilling|Target|Completion of<br>trainings for at<br>least 11 500<br>participants|
|258|C5.2I1<br>Improving the effectiveness of the Department of<br>Labour and Public Employment Services and<br>reinforcing support for young people|Target|Implementation of<br>completed, fully<br>operational<br>platforms|
|261|C5.2I2<br>Establishment of multifunctional centres and<br>childcare centres|Milestone|Adoption of a<br>national strategy<br>on early childhood<br>education and care<br>(ECEC) and an<br>accompanying<br>action plan by the<br>Council of<br>Ministers|
|262|C5.2I2<br>Establishment of multifunctional centres and<br>childcare centres|Target|Grant awarded to<br>at least ten local<br>authorities/ Non-<br>Governmental<br>Organisations for<br>establishing or<br>enhancing<br>Multifunctional<br>Centres or Child<br>Centres|
|264|C5.2I3<br>Establishment of Home structures for children,<br>adolescent with conduct disorders and persons<br>with disabilities and people in need of long term<br>care (LTC)|Target|Buildings for the<br>needs of children<br>or persons with<br>disabilities and<br>support for homes<br>for children,<br>adolescents with<br>conduct disorders<br>and people in need<br>of long-term care<br>(signing of<br>contracts/funding<br>agreements)|
|267|C5.2I4<br>Child Centres in Municipalities|Target|Construction of at<br>least four child<br>centres|

178

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|31b|C6.1I2 Scaled-up measure: Encouraging the use<br>of renewables and energy savings by local/wider<br>public authorities|Target|Reduced primary<br>energy<br>consumption due<br>to investments<br>undertaken by<br>local and wider<br>public authorities,<br>improving their<br>energy<br>performance|
|62b|C6.1I4  Scaled-up measure: Promote widespread<br>use of Electric Vehicles (EVs)|Target|Purchase of<br>electric vehicles,<br>electric bicycles<br>due to the support<br>granted|
|101b|C6.1I5  Scaled-up measure: Scheme for the<br>enhancement of the competitiveness and the<br>energy efficiency of large enterprises in Cyprus|Target|Grants to large<br>enterprises|
|276<br>|C6.1I7  Thematic research in enterprises for<br>energy production, storage, transmission and<br>distribution solutions|Milestone|Signature of grant<br>agreements for the<br>whole budget|
|||Instalment<br>Amount|EUR 168 174 305|

1.8. Eighth Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|6|C1.1I1<br>New facilities for the Cyprus Blood Establishment<br>and procurement of the latest technology attendant<br>equipment|Milestone|New blood<br>establishment<br>facilities including<br>all equipment are<br>fully operational<br>|
|11<br>|C1.1I4<br>Accreditation of public and private hospitals|Target|Health institutions<br>having benefitted<br>from the scheme<br>covering<br>accreditation<br>related costs|
|14|C1.1I6<br>Deployment of generic cross border e-health<br>services in Cyprus|Milestone|Full operation of<br>cross-border<br>healthcare data<br>exchange|

179

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|66|C2.3R1<br>Water Resource Management Reform|Milestone|Adoption of an<br>action plan on<br>water resource<br>management|
|69b|C2.3I2<br>Water Treatment Plants: upgrade for water quality<br>improvement|Milestone|Completion of the<br>works for the<br>replacement of the<br>chlorination<br>infrastructure for<br>the five WTPs|
|81|C2.3I6<br>Enhance water security for Nicosia and Larnaca<br>regions|Target|Completion of<br>construction of<br>three glass lined<br>steel reservoirs<br>and 1 concrete<br>water reservoir|
|84|C2.3I8<br>Protection of the marine ecosystem from hazards<br>through oil spills|Milestone|Delivery, quality<br>inspection to<br>verify their<br>operational<br>effectiveness and<br>acceptance of<br>three vessels and<br>two aerial<br>spraying systems|
|94|C3.1I2<br>Enhancement of isotopic database of traditional<br>Cypriot products|Target|Local traditional<br>foods/ drinks<br>connected to the<br>system|
|111|C3.1R5<br>Establishment of a Coordinating Body between<br>central and local government|Milestone|Legislation on<br>coordination<br>between Central<br>and Local<br>Government|
|161|C3.4R3<br>Introduce new framework for evaluation and<br>selection process for filling public service<br>vacancies and new regulations for the evaluation<br>of employees’ performance|Milestone|New framework<br>for performance<br>evaluation and<br>filling of<br>vacancies in the<br>public service.|
|165|C3.4I2<br>Digitalisation of the law-making process|Milestone|Implementation of<br>the Cyprus<br>Legislation<br>Preparation<br>Platform|
|184|C3.4R9<br>Digital transformation of courts|Milestone|Digital audio<br>recording in court<br>proceedings|

180

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|202|C3.5R6 Reinforcing and strengthening the<br>insolvency framework|Milestone|Operation of all<br>digital systems<br>developed for the<br>Department of<br>Insolvency|
|204|C3.5R8 <br>Enhancing supervision of Insurance and Pension<br>Funds|Target|Strengthening the<br>human resources<br>of the Registrar of<br>Occupational<br>Retirement<br>Benefits Fund<br>(RORBF) and the<br>Insurance<br>Companies<br>Control Service<br>(ICCS)|
|221|C4.1I2<br>Enhance buildingcabling to be “Gigabit-ready”<br>and promote connectivity take-up|Target|Completion of<br>intra-building<br>Gigabit-ready<br>cabling|
|||Instalment<br>Amount|EUR 80 846 787|

1.9. Ninth Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|2a|C1.1R1<br>National Centre for Clinical Evidence and Quality<br>Improvement|Target|Clinical protocols prepared,<br>audited and peer reviewed|
|2b<br>|C1.1R1<br>National Centre for Clinical Evidence and Quality<br>Improvement|Milestone|Development of IT system<br>including an e-learning<br>platform completed and<br>system is operational|
|4 <br>|C1.1R2<br>Design of an Electronic platform for the<br>surveillance of Nosocomial Antibiotic<br>Consumption and Healthcare– Associated<br>Infections|Milestone|Electronic platform<br>including monitoring<br>system is fully operational|
|8|C1.1I2<br>Cyprus Innovative Public Health information and<br>communications technology (ICT) System|Target|Sentinels entering data in<br>the Influenza Sentinel<br>Surveillance System<br>module|

181

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|10|C1.1I3<br>Purchase/replacement of medical equipment in<br>hospitals|Target|Health institutions having<br>benefitted from the<br>financial support scheme|
|15|C1.1I7<br>Public warning system for supporting emergency<br>operations through SMS|Milestone|Newly established public<br>warning system and its<br>monitoring system are fully<br>operational|
|26|C2.1I1<br>Promoting energy efficiency investments in SMEs<br>and non-profit organisations|Target|Entities (SMEs,non-profit<br>organisations) having<br>implemented  energy<br>efficiency interventions|
|37|C2.1I5<br>Energy Efficiency Upgrading of public buildings|Target|Completion of installation<br>of photovoltaic systems in<br>water pump stations and<br>fire stations|
|44|C2.1I8<br>Monitoring and reduction of GHG emissions in<br>agriculture|Target|Reduction of GHG<br>emissions from agriculture|
|46|C2.1I9<br>Forests fire protection|Milestone|Delivery of firefighting<br>aircraft, vehicles and<br>equipment|
|53|C2.2R1<br>Establishment of an Intelligent Transport System<br>using Digital Twin technologies|Target|Delivery and installation of<br>a total of 300 sensors|
|56|C2.2R3<br>Progressively phase out the most polluting<br>vehicles, especially in polluted urban areas|Milestone|Implementation of at least<br>two measures aiming at the<br>exclusion of polluting<br>vehicles|
|70|C2.3I2<br>Water Treatment Plants: upgrade for water quality<br>improvement|Target|Completion of extension<br>works and automation<br>system at Asprokremmos<br>Water Treatment Plant|
|77b|C2.3I5<br>Anti-flood and water collection measures|Milestone|Completion of construction<br>works of drainage network<br>and reconstruction of<br>streets and pavements in<br>areas of Nicosia|
|79|C2.3I5<br>Anti-flood and water collection measures|Milestone|Completion of construction<br>works for the flood channel<br>in Livadia|
|108|C3.1I10<br>Enrichment of the tourism product in rural,<br>mountainous and remote areas|Target|Grants to enterprises and<br>local community boards to<br>promote micro and small<br>businesses in the creative<br>and manufacturing sectors,<br>such as artists, handcrafts<br>and traditional products|
|115|C3.1I12<br>Waste management towards circular economy|Target|Completion of installation<br>and start of operation of the<br>green kiosks|

182

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|126|C3.2I1<br>Set up and operate a central Knowledge Transfer<br>Office (KTO)|Target|Case files closed attesting<br>provision of relevant<br>knowledge transfer services|
|137|C3.3R2<br>Enhancing Fast-Track Business Activation<br>Mechanism|Target|Establishment of a<br>platform where investors<br>can track their online<br>application and interact<br>with the competent<br>authorities and assessments<br>of applications for<br>investment through the<br>platform|
|138|C3.3R3<br>Modernisation of the Companies Law|Milestone|Submission of the draft law<br>to the Parliament for<br>approval, restructuring the<br>Companies Law|
|141|C3.3R4<br>Design and establish a National Promotional<br>Agency|Milestone|Start of operations of<br>Cyprus National<br>Promotional Agency|
|157|C3.4R1<br>Enhance the administrative capacity and improve<br>the functioning of public administration for better<br>policy making and implementation|Milestone|Implementation of the<br>Action Plan on the efficient<br>management of human<br>resource issues in the<br>national public<br>administration|
|162|C3.4R4<br>Strengthen administrative capacity and<br>transparency through the professionalisation of<br>public procurement and further digitalisation of its<br>process|Milestone|New integrated e-<br>procurement system|
|166|C3.4I2<br>Digitalisation of the law-making process|Milestone|Digitalisation of laws &<br>regulations in the new<br>platform|
|168|C3.4I3<br>Economic Policy Modelling Hub|Target|Number of developed<br>impact assessment models<br>and data analysis tools|
|172|C3.4R7<br>Urban land consolidation|Target|Number of master plans for<br>urban planning|
|185|C3.4I7<br>Training of judges|Target|Training of judges|
|213|C3.5I2 <br>Modernisation of Customs and Electronic<br>Payment System|Target|Putting into operation of<br>the information systems<br>envisaged under the UCC|
|219|C4.1I1<br>Expansion of Very High Capacity Networks in<br>underserved areas|Target|Completion of very high<br>capacity networks’<br>deployment in underserved<br>areas|
|228|C4.2R2<br>Definition and implementation of a new cloud<br>policy with regard to government IT systems and<br>services|Target|The government cloud (G-<br>cloud) in two data centres is<br>operational and offering<br>cloud services|

183

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|230|C4.2R3<br>Police Procedures digitalisation on Digipol|Target|Citizens use Digipol|
|235|C4.2I1<br>Digitalisation in various Central Government<br>Ministries - Services|Target|Finalisation of the digital<br>upgrade of a number of<br>central government<br>ministries and departments|
|238|C4.2I2<br>Digitalisation of the Cyprus Ports Authority|Target|Finalisation of the digital<br>upgrade of the Cyprus Ports<br>Authority|
|240|C5.1R1<br>Addressing skills mismatch between education<br>and labour market (Secondary and Higher<br>Education)|Target|Secondary education<br>teaching staff trained|
|242|C5.1R2<br>A new teacher and school evaluation system|Target|Training of teaching staff|
|250|C5.1R5<br>E-skills Action Plan– Implementation of specific<br>actions|Milestone|Implementation of key<br>measures from the e-Skills<br>Action Plan|
|254|C5.1I2<br>Skilling, Reskilling and Upskilling|Target|Completion of trainings for<br>at least 25 600 participants|
|256|C5.2R2<br>Flexible Work Arrangements in the Form of<br>Telework|Target|Grant awarded for at least<br>400 persons in telework|
|259|C5.2I1<br>Improving the effectiveness of the Department of<br>Labour and Public Employment Services and<br>reinforcing support for young people|Target|Grant awarded to<br>employers for hiring at<br>least 600 young people not<br>in employment or in<br>education or training<br>(NEETs)|
|269|C5.2I5<br>Construction of Two Model Special Education<br>Schools|Milestone|Completion of construction<br>of Apostolos Loukas & Red<br>Cross Special needs school|
|272|C6.1R1 Regulating and facilitating the<br>participation of Active Customers, Renewable<br>Self-consumers, Citizen Energy Communities,<br>Renewable Energy Communities and Demand<br>Response through Cumulative Representation in<br>the electricity market|Milestone|Expanding the<br>competencies of the single<br>contact point established as<br>per the Renewable Energy<br>Directive (EU) 2018/2001,<br>to also serve as a contact<br>point regarding the<br>renewable and citizens<br>communities, Active<br>customers and Renewable<br>self-consumers|
|274|C6.1R2 Establishment of the regulatory<br>framework for the connection of EV recharging<br>points to the distribution network|Milestone|Regulatory Decision/s for<br>the connection of EV<br>recharging points to the<br>distribution network|
|||Instalment<br>Amount|EUR 60 135 712|

184

1.10. Tenth Instalment (non-repayable support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|12|C1.1I4<br>Accreditation of public and private hospitals|Target|Health institutions<br>having benefitted<br>from the scheme<br>covering<br>accreditation<br>related costs|
|20 <br>|C2.1R1<br>Green Taxation|Milestone|Impact assessment<br>report measuring<br>the reform’s effect<br>on the environment<br>and the economy|
|29a <br>|C2.1I2<br>Promoting renewables and individual energy<br>efficiency measures in dwellings and tackling<br>energy poverty in households with vulnerable<br>electricity consumers|Target|Dwellings and<br>households with<br>vulnerable<br>electricity<br>consumers<br>(including people<br>with disabilities)<br>having improved<br>their energy<br>performance|
|32a|C2.1I3<br>Encouraging the use of renewables and energy<br>savings by local/wider public authorities and<br>facilitating the transition of local communities<br>towards climate mitigation & adaptation|Target|Investments<br>undertaken by local<br>authorities  that<br>have improved their<br>energy performance|
|32c|C2.1I3<br>Encouraging the use of renewables and energy<br>savings by local/wider public authorities  and<br>facilitating the transition of local communities<br>towards climate mitigation & adaptation|Target|Grant scheme to<br>support sustainable<br>climate adaptation<br>investments in local<br>(Community)<br>Councils|
|42|C2.1I7<br>Mass installation and operation by the Distribution<br>System Operator (DSO) of Smart Metering<br>Infrastructure (Advanced Metering Infrastructure)|Target|Delivery and<br>installation of smart<br>meters|
|47|C2.1I9<br>Forests fire protection|Milestone|Completion of<br>services|
|58|C2.2I1<br>Implementation of Sustainable Urban Mobility<br>Projects (SUMP) and accessibility enhancing<br>measures|Target|Completion of<br>construction work<br>for at least 52km of<br>sustainable<br>transport routes|

185

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|59|C2.2I1<br>Implementation of Sustainable Urban Mobility<br>Projects (SUMP) and accessibility enhancing<br>measures|Target|Completion of<br>construction work<br>for at least 644<br>ancillary<br>installations related<br>to sustainable<br>transport|
|61|C2.2I2<br>Creation of electro-mobility infrastructure|Target|Installation of at<br>least 1 200 charging<br>points, due to the<br>support granted|
|63a|C2.2I3<br>Promote widespread use of Electric Vehicles<br>(EVs)|Target|Purchase of electric<br>vehicles, electric<br>bicycles, due to the<br>support granted|
|65|C2.2I3<br>Promote widespread use of Electric Vehicles<br>(EVs)|Target|Scrapping of high<br>emission vehicles,<br>due to the support<br>granted|
|68|C2.3I1<br>Choirokitia‑ Famagusta Conveyor Replacement|Target|Installation of new<br>pipeline with total<br>length of 20km|
|73|C2.3I3<br>Integrated Monitoring and Control Management<br>System for the Water Development Department’s<br>infrastructure|Milestone|Completion of a<br>fully functional<br>Integrated<br>Monitoring and<br>Control Water<br>Management<br>System|
|74b|C2.3I4<br>Smart Water and Sewerage Networks<br>Management|Target|Delivery and<br>installation of<br>biogas unit at the<br>Larnaca<br>Wastewater<br>Treatment Plant<br>|
|76a|C2.3I4<br>Smart Water and Sewerage Networks<br>Management|Target|Installation and<br>operation of at least<br>100 000 smart<br>meters|
|76b|C2.3I4<br>Smart Water and Sewerage Networks<br>Management|Target|Development of<br>Digital Twin<br>decision support<br>tool and data bank<br>in Larnaca and<br>design of a<br>customised<br>software solution in<br>Limassol|

186

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|88|C3.1R2<br>On-line platform for improving the trade and<br>information symmetry in the fresh produce supply<br>chain|Milestone|Platform for<br>recording<br>transactions in the<br>local fresh produce<br>market|
|90|C3.1R3<br>Genetic improvement of the Cyprus sheep and<br>goat population|Target|Adoption of<br>advanced recording<br>and genomic<br>evaluation<br>processes, and<br>selection of the best<br>performing animals|
|99|C3.1I6<br>Scheme for modernisation and digitalisation of<br>enterprises engaged in manufacturing and trading<br>of agricultural products|Target|Grants to SMEs<br>engaged with trade<br>and production of<br>agricultural<br>products|
|102a|C3.1I7<br>Scheme for the enhancement of the<br>competitiveness and/or the energy efficiency of<br>large enterprises in Cyprus|Target|Grants to large<br>enterprises|
|104a|C3.1I8<br>Enhancing the added value of the tourism sector<br>with emphasis on the country side, mountainous<br>and remote areas|Target|Grant to hotels to<br>promote the tourism<br>sector|
|104b|C3.1I8<br>Enhancing the added value of the tourism sector<br>with emphasis on the country side, mountainous<br>and remote areas<br>|Target|Grants to promote<br>medical tourism<br>|
|106|C3.1I9<br>Promotion of circular economy in hotel<br>establishments|Target|Coaching scheme<br>for circular<br>economy|
|110|C3.1R4<br>Enhancement of circular economy in the Industry|Target|Aid for SMEs<br>which are moving<br>into a circular<br>operating model|
|121|C3.2R1<br>National R&I Policy and policy tools|Milestone|Completion of the<br>Action Plan for the<br>R&I Strategy|
|129|C3.2I2<br>Innovation funding programmes for start-ups,<br>innovative companies and SMEs|Target|Organisations<br>supported to carry<br>out R&I related<br>activities|
|131a|C3.2I3<br>R&I funding program on green transition|Target|Organisations<br>supported by grants<br>on green transition<br>R&I activities|

187

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|133|C3.2I4<br>Funding organisations performing R&D activities<br>on dual technologies|Target|Funding for the<br>development of<br>classified<br>Laboratories|
|139|C3.3R3<br>Modernisation of the Companies Law|Milestone|Entry into force of<br>the Companies Law|
|148|C3.3I4<br>Scheme for the digital upgrade of enterprises|Target|SMEs supported<br>following<br>submission of<br>payment<br>applications.|
|152|C3.3I6<br>State funded equity fund|Target|Investees supported<br>through the Fund|
|176|C3.4I5<br>Smart cities|Target|Development of<br>mobile applications<br>developed as part of<br>the smart cities<br>initiative and<br>installation of smart<br>sensors in service<br>as part of the smart<br>cities initiative|
|178|C3.4I6<br>Regeneration and Revitalisation of Nicosia Inner<br>City|Target|Rooms renovated<br>and converted to<br>student dorms|
|179|C3.4I6<br>Regeneration and Revitalisation of Nicosia Inner<br>City|Milestone|Renovation of<br>Faneromeni School|
|182|C3.4R8<br>Efficiency of Justice|Target|Further reducing<br>the backlog of cases<br>and appeals|
|211|C3.5R10 <br>Addressing Aggressive Tax Planning|Milestone|Entry into force of<br>legislative changes<br>addressing the<br>findings of an<br>independent<br>evaluation on the<br>effectiveness of<br>measures related to<br>aggressive tax<br>planning|
|226|C4.2R1<br>Digital Services Factory|Target|Delivery online of<br>at least 70<br>previously non-<br>digital services to<br>the public through<br>the Digital Services<br>Factory|

188

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|239b|C5.1R1<br>Addressing skills mismatch between education<br>and labour market (Secondary and Higher<br>Education)|Target|Completion of the<br>in-job shadowing<br>programme|
|239c|C5.1R1<br>Addressing skills mismatch between education<br>and labour market (Secondary and Higher<br>Education)|Target|Laboratories<br>equipped and<br>updated|
|244|C5.1R3<br>Gradual extension of free compulsory pre-primary<br>education from the age of four|Target|Children aged<br>between 4 years<br>and 4 years and 8<br>months enrolled in<br>public, community<br>and private<br>kindergartens|
|245|C5.1R3<br>Gradual extension of free compulsory pre-primary<br>education from the age of four|Target|At least 675 new<br>places in public<br>kindergartens.<br>Adoption by the<br>Council of<br>Ministers of an<br>action plan which<br>shall describe plans<br>for the gradual<br>expansion of the<br>capacity in public<br>kindergartens and<br>the gradual<br>corresponding<br>reduction of the two<br>aid schemes from<br>the time of the entry<br>into force of the law<br>until the completion<br>of the decrease in<br>compulsory age.|
|246b|C5.1R4<br>Digital transformation of school units with the aim<br>of enhancing digital skills and skills related to<br>STEM education|Target|Partial<br>reimbursement  for<br>the purchase of<br>digital equipment<br>for pupils|
|248|C5.1R4<br>Digital transformation of school units with the aim<br>of enhancing digital skills and skills related to<br>STEM education|Target|Teachers<br>benefitting from In-<br>Service Training &<br>Professional<br>Development|
|252|C5.1I1<br>Construction of one Model Technical School|Milestone|Completion of<br>construction of one<br>Technical School|

189

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|260|C5.2I1<br>Improving the effectiveness of the Department of<br>Labour and Public Employment Services and<br>reinforcing support for young people|Target|Coaching and<br>career guidance for<br>young people not in<br>employment or in<br>education or<br>training (NEETs)|
|263|C5.2I2<br>Establishment of multifunctional centres and<br>childcare centres|Target|Grant awarded to at<br>least 27 local<br>authorities/ Non-<br>Governmental<br>Organisations for<br>establishing or<br>enhancing<br>Multifunctional<br>Centres or Child<br>Centres|
|265|C5.2I3<br>Establishment of Home structures for children,<br>adolescent with conduct disorders and persons<br>with disabilities and people in need of long term<br>care (LTC)|Target|Buildings for the<br>needs of children or<br>persons with<br>disabilities and<br>support for homes<br>for children,<br>adolescents with<br>conduct disorders<br>and people in need<br>of long-term care|
|29b|C6.1I2 Scaled-up measure: Promoting renewables<br>and individual energy efficiency measures in<br>dwellings and tackling energy poverty in<br>households with vulnerable electricity consumers|Target|Dwellings and<br>households with<br>vulnerable<br>electricity<br>consumers having<br>improved their<br>energy performance|
|32b|C6.1I2 Scaled-up measure: Encouraging the use<br>of renewables and energy savings by local/wider<br>public authorities|Target|Reduced primary<br>energy<br>consumption due to<br>investments<br>undertaken by local<br>and wider public<br>authorities,<br>improving their<br>energy performance|
|275|C6.1I3 Promoting extensive energy upgrading of<br>housing stock|Target|Households being<br>energy renovated,<br>improving their<br>energy performance|
|63b|C6.1I4 Scaled-up measure: Promote widespread<br>use of Electric Vehicles (EVs)|Target|Purchase of electric<br>vehicles, electric<br>bicycles due to the<br>support granted|

190

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|102b|C6.1I5 Scaled-up measure: Scheme for the<br>enhancement of the competitiveness and the<br>energy efficiency of large enterprises in Cyprus|Target|Grants to large<br>enterprises|
|131b|C6.1I6 Scaled-up measure: Thematic research<br>and innovation funding program on green<br>transition|Target|Organisations<br>supported by grants<br>on green transition<br>R&I activities|
|277|C6.1I7 Thematic research in enterprises for<br>energy production, storage, transmission and<br>distribution solutions|Target|Organisations<br>supported by grants<br>on energy<br>production, storage,<br>transmission and<br>distribution<br>solutions R&I<br>activities|
|||Instalment<br>Amount|EUR 102 121 941|

191

**2.** **Loan**

The instalments referred to in Article 3(2) shall be organised in the following manner:

2.1. First Instalment (loan support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|16|C1.1R3 <br>Gradually shifting the healthcare provision and<br>reimbursement framework towards value-based<br>models.|Milestone|Value-based<br>reimbursement to<br>be reflected for<br>primary and in-<br>patient care|
|49|C2.1I11<br>Ending energy isolation - Project of Common<br>Interest "EuroAsia Interconnector"|Milestone|Start of the<br>construction<br>works of the<br>HVDC Converter<br>Station in Kofinou<br>and the onshore<br>infrastructure in<br>Cyprus|
|91|C3.1I1<br>Marine aquaculture construction|Milestone|Construction of<br>the collaborative<br>marine<br>aquaculture|
|270|C5.2R1<br>Reform of the Social Insurance System and<br>Restructuring of the Social Insurance Services|Milestone|Entry into force of<br>the revised Social<br>Insurance Law|
|||Instalment<br>Amount|EUR 57 471 264|

2.2. Second Instalment (loan support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|17|C1.1I5 <br>Enhancement, modernisation and upgrade of<br>Cyprus State Hospitals|Target|Enhanced,<br>constructed and/or<br>upgraded State<br>hospitals|
|153|C3.3I1<br>Integrated Information system for the Department<br>of Registrar of Companies and Intellectual<br>Property|Milestone|System hardware<br>and software<br>installation and<br>networking<br>completed|
|||Instalment<br>Amount|EUR 44 951 264|

192

2.3. Third Instalment (loan support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|50 <br>|C2.1I11<br>Ending energy isolation - Project of Common<br>Interest "EuroAsia Interconnector"|Milestone|Completion of<br>construction of<br>converter station|
|116a|C3.1I11 <br>Improvement and extension of the Cyprus Green<br>Points Network and creation of a network of<br>Collection Points and Recycling Corners|Target|Completion of<br>construction,<br>expansion and<br>start of operation<br>of four Green<br>Points|
|||Instalment<br>Amount|EUR 37 294 483|

2.4. Fourth Instalment (loan support):

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|18|C1.1I5 <br>Enhancement, modernisation and upgrade of<br>Cyprus State Hospitals|Target|Enhanced,<br>constructed and/or<br>upgraded State<br>hospitals|
|51|C2.1I11<br>Ending energy isolation - Project of Common<br>Interest "EuroAsia Interconnector"|Milestone|Completed and<br>fully operational<br>facility of the<br>electricity<br>interconnection<br>between Cyprus-<br>Crete (Greece)|
|92|C3.1I1<br>Marine aquaculture construction|Milestone|Operational<br>collaborative<br>marine<br>aquaculture<br>Infrastructure|
|116b|C3.1I11Improvement and extension of the Cyprus<br>Green Points Network and creation of a network<br>of Collection Points and Recycling Corners|Milestone|Completion of<br>construction,<br>expansion and<br>start of operation<br>of a network of<br>Collection Points<br>and Recycling<br>Corners|

193

|Sequential<br>Number|Related Measure (Reform or Investment)|Milestone /<br>Target|Name|
|---|---|---|---|
|117|C3.1I11 <br>Improvement and extension of the Cyprus Green<br>Points Network and creation of a network of<br>Collection Points and Recycling Corners|Target|Completion of<br>construction,<br>expansion and<br>operation of 14<br>Green Points|
|154|C3.3I1<br>Integrated Information system for the Department<br>of Registrar of Companies and Intellectual<br>Property|Target|Training of<br>personnel|
|190|C3.4I9<br>Aid Scheme for the private and public sector for<br>certification with ISO 37001 (Anti i<br>Bribery)|Target|ISO 37001 anti-<br>bribery<br>management<br>systems|
|271|C5.2R1<br>Reform of the Social Insurance System and<br>Restructuring of the Social Insurance Services|Milestone|Completion and<br>go-live of the<br>Integrated Social<br>Security<br>Information<br>System including<br>payment module,<br>benefits<br>administration<br>module, data<br>analytics and<br>interoperability<br>with other<br>systems.|
|||Instalment<br>Amount|EUR 60 602 989|

194

**SECTION** **3:** **ADDITIONAL** **ARRANGEMENTS**

**1.** **Arrangements for monitoring and implementation of the recovery and resilience plan**

The monitoring and implementation of the recovery and resilience plan of Cyprus has been
set out in the Council of Ministers decision of 14 May 2021, which approved the plan. They
shall take place in accordance with the following arrangements:

    - The Monitoring Committee, chaired by the Director General of the Directorate General

Growth, Ministry of Finance and attended by the Directors-General of Ministries and
Deputy Ministries involved in the plan, shall be responsible for centrally monitoring
progress in implementation, resolving issues and responding to risks at the highest

technical level. It shall convene at least before each submission to the Commission of

requests for payment and progress reports provided for under Regulation (EU) 2021/241.
It may rely on reporting and other support from the Coordinating Authority.

    - The Coordinating Authority, which is the Directorate for Recovery and Resilience of the

Directorate General Growth, shall be responsible for the monitoring and implementation
of the recovery and resilience plan at operational level. Specifically, the Coordinating
Authority is responsible for monitoring, verifying and certifying the achievement of the
milestones and targets of measures of the plan and ensuring the timely submission of all
information described in Article 22(2), point (d) of Regulation (EU) 2021/241. In
performing its monitoring functions, the Coordinating Authority is assisted by two
specialised Monitoring Bodies designated for specific measures of the plan.

    - The National Control and Audit Coordinator for the implementation of the plan, which

is the Verifications and Certification Directorate of the Treasury of the Republic of
Cyprus, shall be responsible for supporting the Coordinating Authority in overseeing
controls by all stakeholders, including Implementing Bodies, in accordance with the
management and control system of the plan and the national and EU legislation. In that
respect, it shall also monitor the status of the findings of ex post audits, acting as the
intermediate body between the Coordinating Authority and the Internal Audit Service of
the Republic of Cyprus and the Audit Office of the Republic of Cyprus (together, “the
audit bodies”). The National Control and Audit Coordinator shall not be involved  in the
planning and execution of the audits, which is within the sole responsibility of the audit
bodies. It shall manage and process all information described in Article 22(2), point (d)
of Regulation (EU) 2021/241, collected by the Implementing Bodies. In this respect, it
has the responsibility to oversee the treatment of serious irregularities, meaning fraud,
corruption and conflicts of interests, and ensure that double funding is avoided through
controls of the information submitted by the Implementing Bodies.

    - The Implementing Bodies shall have the first line responsibility to prevent, detect, report

and correct conflicts of interest, corruption and fraud, and avoid double funding. To that
end, they shall undertake first level controls and verifications of the physical and
financial aspect of the measures under their responsibility and regularly update the
Coordinating Authority and the specialised Monitoring Bodies, where relevant,
regarding progress in achieving the milestones and targets of the measures under their
responsibility and by providing all the necessary supporting documentation.

195

    - The Internal Audit Service of the Republic of Cyprus is responsible for conducting ex

post internal audits in any central government body including the audit of the
achievement of milestones and targets of the plan, through an appropriate sampling
method. The Audit Office of the Republic of Cyprus is responsible for conducting
financial, performance and compliance ex post (and in some cases real time) external
audits for projects implemented under the national budget through an appropriate
sampling method which complies with the International Organisation of Supreme Audit
Institutions (INTOSAI) standards. It shall be ensured that the selected sample necessarily
includes a sufficient number of measures implemented through the the recovery and
resilience plan.

    - The Coordinating Authority shall be the body drawing up the requests for payment to

the European Commission. The Coordinating Authority shall be supported by the
National Control and Audit Coordinator in retrieving the results of audit procedures
undertaken by the audit bodies (including the Internal Audit Service and the Audit
Office), as well as all cases of serious irregularities, including cases of fraud or suspicion
of fraud, corruption and conflicts of interest, that shall feed into the summary of audits,
which shall accompany payment applications.

**2.** **Arrangements for providing full access by the Commission to the underlying data**

A dedicated Monitoring Information System (MIS) shall be used by the Directorate for
Recovery and Resilience of the Directorate General Growth for the implementation of the
plan. Its core functionalities, or a contingent repository system with the required
functionalities, shall be in place as attested by an audit report by 31 March 2022. In terms of
required functionalities, a repository system shall record and store the relevant data related
to the implementation of the recovery and resilience plan, in particular on the achievement
of milestones and targets, data on final recipients, contractors, subcontractors and beneficial
owners in line with Article 22(2), point (d), sections (i) to (iii) of Regulation (EU) 2021/241,
by the first payment request.

In accordance with Article 24(2) of Regulation (EU) 2021/241, upon completion of the
relevant agreed milestones and targets in Section 1 of this Annex, Cyprus shall submit to the
Commission a duly justified request for payment of the financial contribution and of the
loan. Cyprus shall ensure that, upon request, the Commission has full access to the
underlying relevant data that supports the due justification of the request for payment, both
for the assessment of the request for payment in accordance with Article 24(3) of Regulation
(EU) 2021/241 and for audit and control purposes.

196