Cyprus Mail

MPs to override President’s veto on foreclosures

By Angelos Anastasiou

OPPOSITION parties are expected to override President Nicos Anastasiades’ veto of an amendment they passed, which pushes the implementation of tougher foreclosures legislation – originally on January 1, 2015 – back by one month.

The amendment has been deemed “unnecessary” by Finance minister Harris Georgiades, since foreclosures legislation cannot be enforced without the approval of the relevant regulations, hence remains inactive.

But its voting has derailed Cyprus’ economic adjustment programme (also known as the “Memorandum of Understanding”), a reform agenda agreed with the European Union and the International Monetary Fund in exchange for an emergency €10bn loan amidst a disastrous banking meltdown in mid-2013.

Opposition parties cited the government’s failure to prepare an “insolvency framework” – a set of five laws governing cases of bankrupt and insolvent borrowers – in time for voting before the January 1 deadline, as it had pledged, as the reason for suspending the foreclosures laws.

Anastasiades’ veto, which was accompanied by a letter explaining its rationale, will be discussed at the House Finance committee on Monday.

Ruling party DISY – the only party to oppose the amendment in the December 18 vote – argued that the House could have opted to refuse to pass the necessary regulations governing the operation of the foreclosures legislation, instead of formally suspending its implementation.

“From the beginning, we believed that suspending the law served no purpose because the insolvency framework is almost ready,” DISY spokesman Prodromos Prodromou said. “We have the option of creating a system that will protect viable borrowers who find themselves unable to meet their obligations because of the crisis.”

AKEL leader Andros Kyprianou said the government “is lying” when it says that foreclosures legislation is dormant pending the passing of relevant regulations, and said his party will vote to ignore the President’s veto.

“In fact, the foreclosures process was started last September,” he said. “The only thing that needs to be regulated is the auctioning procedure, and the details that go with auctioning.”

DIKO’s leader and House Finance committee chairman Nicolas Papadopoulos said the committee will convene on Monday.

“We will look at the reasons cited by the President in his letter to the House, before making a decision,” he said. “As DIKO, the reason we voted to suspend the foreclosures law was that the insolvency framework that would protect borrowers has not been prepared yet. It needs to be implemented in parallel and at the same time as the foreclosures legislation.”

If his veto is overridden, Anastasiades will be left with the options of either signing the amendment into law or referring it to the Supreme Court for a final decision.

But while acknowledging that overriding the President’s veto could only serve symbolic purposes, EDEK will insist on voting the amendment.

“By the time the process is over, the January 30 milestone will have been missed,” said EDEK spokesman Costis Efstathiou. “Ipso facto, the point is moot. But EDEK will support its original position and will vote against the veto.”

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