Insider Economy Mishandling by authorities leads to EU fines

Mishandling by authorities leads to EU fines

Inconsistency and lack of coordination between the Ministry of Finance, Central Bank of Cyprus and the island’s Legal Service in the preparation of legislation are leading the Republic towards adventures.

And not for the first time either. This time it regards amendments to the law on credit facilities, as well as on the consumer credit contracts in relation to residential property.

Even though Cyprus is on the brink of getting slapped with heavy fines from the European Commission, the divergence of views between institutions and the executive power came to light during yesterday’s debate before the House Finance Committee of the draft legislation.

In relation to the bill on facilities which provides a capital buffer for the protection of depositors in the event of resolution or liquidation of a credit institution with the establishment of eligible debt instruments, the Legal Service has amended the article on the classification of claims in the event of a financial institution’s insolvency. The Finance Ministry was informed about the amendment, but not the Central Bank.

The representative of the Legal Service said that when the bill was sent to them for a review the Finance Ministry had additional provisions that are not part of harmonisation reforms.  He also said that the additional provisions are not compatible with the European directive.

But he called on the House to vote in favour of the bill anyway because the Republic’s infringement will be penalised. As for the Finance Ministry’s Financial Stability Director Andreas Charalambous he said that they had failed to convince the Legal Service of the additional provisions.

But, he added, it would be better to approve the reform bill now and change it later. Central Bank representative Maria Kettirou said the specific article does not concern harmonisation reforms but rather reflects government policy. The Central Bank is against the proposed article.

Representatives of the Ministry will meet today (Tuesday) with those of the Legal Service to find a compromise solution. However, the representative of the Legal Service has rushed to clarify that it should not be taken for granted that the additional provisions proposed by the Ministry will be accepted.


Read more:




Top Stories

273 new cases of COVID-19 our of 57,926 tests announced on Friday

The Health Ministry announced 273 new Coronavirus cases out of 57,926 PCR and rapid antigen tests on Friday, 5 March, taking confirmed infections to...

Very few COVID-19 confirmed cases found among students

The Health Ministry today carried out antigen rapid tests to the staff and students of private and public schools. In total 10,147 have been tested...

Niki Zarou files lawsuit against Yiolitis, Republic of Cyprus

Following the cancellation of the search warrant of her house in the case of the parody account on Twitter, under the title “Lady Emily...

Where to get a rapid test on Saturday, 6 March

Aiming at the continuous surveillance of the community and the workplaces, the free programmes of rapid antigen testing of the general population and employees...

The EU will never accept a two-state solution for Cyprus, Borrell underlines

Turkey and the Turkish Cypriot side must stay away from the rhetoric for two states in Cyprus, because such a form of a settlement...


Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...


No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...