Cyprus Plans to Tighten Rules for Car Sales

Cyprus is preparing for major changes to the way vehicles are sold. The Department of Road Transport (TOM) has drafted two bills that would, for the first time, introduce mandatory licensing for car dealers, new disclosure requirements for buyers, and substantial penalties for violations.

The reform was prompted by problems related to vehicle recalls, including those involving defective Takata airbags, as well as numerous complaints about the used car market. For now, the draft laws have been published on the government's δημόσια consultation platform η-Διαβούλευση and have not yet entered into force.

Licensing for Dealers and New Vehicle Sales Requirements

The proposed legislation provides for the establishment of a Vehicle Dealers Registration Council, which will be based in Nicosia. The new body will be responsible for:

1. issuing one-year dealer licenses;
2. maintaining an official register of vehicle dealers;
3. suspending or revoking licenses;
4. imposing disciplinary measures for violations.

Operating without a license will be prohibited. In addition, every dealer will be required to provide a financial guarantee that can be used to compensate buyers if the law is breached.

When selling a vehicle, dealers will also be required to provide buyers with written information in Greek, including:

1. the vehicle's actual technical condition;
2. its origin;
3. its registration history;
4. details of all completed and ongoing recall campaigns;
5. known defects;
6. the vehicle's actual odometer reading.

Combating odometer fraud is considered one of the reform's main objectives. Separate penalties are предусмотрed for concealing information or providing false statements.

Fines of Up to €250,000 and New Vehicle Recall Rules

The first bill focuses on improving vehicle safety oversight. For the first time, it clearly distinguishes between:

1. a recall — returning a vehicle that is already in the owner's possession;
2. a withdrawal — preventing an unsafe vehicle from being placed on the market.

Responsibility for enforcement will be shared between two government departments:

1. the Department of Road Transport (TOM), which will act as the vehicle type-approval authority;
2. the Department of Electromechanical Services, which will oversee market surveillance.

The proposed legislation introduces administrative fines ranging from €1,000 to €250,000, depending on the severity of the violation. If the breach is not corrected, additional penalties of between €100 and €30,000 per day may also be imposed.

Importers will be required to notify the authorities immediately when a recall campaign begins and to inform vehicle owners without delay. The bill specifies several notification methods:

1. registered mail;
2. telephone call;
3. SMS;
4. publication of VIN numbers, model, make, and year of manufacture on the importer's website;
5. publication of information through the media.

Who Will Be Responsible for Vehicles Without an Official Importer

The draft legislation also defines responsibility for vehicles imported through different channels. If a vehicle has European type approval, responsibility will rest with the manufacturer, its official representative, or the registered distributor in Cyprus.

For vehicles imported from non-EU countries without European certification, the registered Cypriot distributor of the brand will be held responsible, even if that distributor did not sell the particular vehicle. If there is no official representative of the brand in Cyprus, responsibility for complying with the legislation may be assigned directly to the vehicle owner.

The Reform Follows the Takata Airbag Crisis

One of the main reasons behind the proposed legislation is the large-scale recall campaign involving vehicles fitted with defective Takata airbags, which is still ongoing in Cyprus. In June 2026, the Department of Road Transport announced an additional recall affecting 11 vehicles: eight Chrysler models, two Dodge models, and one Daihatsu. Owners were advised to stop using these vehicles immediately until the defective components are replaced, as the airbag inflator may rupture during deployment and eject metal fragments.

To improve the effectiveness of recalls, the authorities have already introduced additional measures. Since October 3, 2025, the Department of Road Transport has been suspending roadworthiness certificates for vehicles whose owners fail to complete mandatory recalls within eight months, as required under Circular 8/2025.

Following the public consultation process, both draft laws are expected to be revised before being submitted to Parliament. If adopted, Cyprus will, for the first time, introduce a unified licensing system for vehicle dealers together with stronger consumer protection rules, improving both market transparency and vehicle safety across the island.

A wide selection of vehicles is available on the DOMCar portal.