Cyprus Mail
Cyprus Cyprus Talks Property

Expat alarm over north property

The villa the Orams lived in built on Greek Cypriot property

By George Psyllides

British expats living in the Turkish occupied north have expressed concern over the fate of the properties they bought should the island’s division is resolved, and warned of unrest and discontent.

Thousands of Britons and other Europeans, have taken advantage of the situation on the island to buy real estate at highly affordable prices in the north where the vast majority of the houses were built on land belonging to Greek Cypriots.

Now that a solution appears closer than it has in over a decade, they have begun to worry.

In a letter to Turkish Cypriot leader Mustafa Akinci this month, the British Residents Society “one of the largest and oldest legally recognised expatriate organisations” in the breakaway state, requested a meeting to discuss concerns arising from the reunification talks.

“…the possible direction that the current Cyprus talks are taking is causing widespread concern amongst our membership about the long term security of our interests here.”

The BRS, formed in 1974, the year Turkey invaded and occupied 37 per cent of the island, seem to be particularly concerned about the new property commission to be set up as agreed recently by the two leaders.

“In particular, the structure and role of the proposed property commission is of great concern to the expat community and is, if the rumours are true, likely to lead to considerable unrest and discontent, ” the letter warned.

The BRS said it has been recognised as a major contributor to the revenues of the breakaway state and its economy in general, it said.

The society said it wanted to discuss whether their title deeds would be honoured and whether the rights of those holding them would be protected in the talks.

“Can your Excellency explain how the security of such title deeds can be honoured if all inter-communal property disputes in a reunited Cyprus were subject to the judgements of a new island wide Property Commission?”

The BRS is also asking whether current citizens of the “unrecognised TRNC” would become citizens of the Republic of Cyprus and the EU and that consequently all expats resident in the north, or who have bought property there, would have to be treated in law and practice as equal to Greek and Turkish Cypriots.

They also want to know what protection would be afforded to Turkish Lira account holders in case of a settlement and adoption of the euro.

“Given the level of expatriate investment in both property and currency holdings in the TRNC does your Excellency recognise the significant direct interest we have in any Cyprus ‘solution’”? the BRS said. It asked Akinci what he planned in doing to protect those interests for expats and Turkish Cypriots alike, by ensuring that reunification and adoption of the euro were phased programmes “allowing for genuine convergence of the two Cyprus economies involved and allowing for the continuing disastrous economic conditions that are still engulfing the south.”

The expats also wanted to know what Akinci intended to do regarding the role of the guarantor powers and Turkish army.

One of the most famous cases of Britons being ousted from Greek Cypriot property was that of the Orams couple David and Linda, who were sued by Greek Cypriot refugee Meletis Apostolides in a court in the Republic.

Apostolides demanded that the Orams vacate his property in Lapithos, which the Orams bought and built on in 2002.

His lawyer argued that despite the invasion and the loss of control over the northern part, the Republic’s laws still applied even if they would not be enforced.

The court ordered the Orams in 2004 to demolish the villa, terminate use of the land, and pay compensation.

A subsequent appeal was dismissed by the Supreme Court.

Because the decision could not be enforced, Apostolides used EU regulations to register the judgement in the UK and apply against the Orams’ assets there.

The Orams were represented by Cherie Blair, wife of British prime minister at the time Tony Blair.

In September 2006, the High Court of Justice ruled in favour of the Orams, a decision appealed by Apostolides.

The Court of Appeal referred the case to the European Court of Justice in Luxembourg, which eventually ruled in Apostolides’ favour.

The case went back to England where the Court of Appeal also ruled in Apostolides’ favour.

A 2010 attempt by the Orams to appeal the case at the Supreme Court of the United Kingdom failed.

The Orams were ordered to pay around a million pound sterling in legal fees – believed to have been paid by the breakaway state – and some €43,000 to Apostolides, representing rent for the use of his property between 2002 and 2009.

The Orams said they could not enforce the demolition order – not allowed by the regime in the north — and Apostolides eventually lifted his claim on their property in the UK.

It is understood that the property in Lapithos has been lying abandoned since.

PITFALLS

The UK Foreign and Commonwealth Office on its website warns of the pitfalls of buying in the north of Cyprus as follows:

The ownership of many properties is disputed in the north of Cyprus, with thousands of claims to ownership from people displaced during the events of 1974. Purchase of these properties could have serious financial and legal implications. The European Court of Human Rights has ruled in a number of cases that owners of property in northern Cyprus before 1974 continue to be regarded as the legal owners of that property. Purchasers could face legal proceedings in the courts of the Republic of Cyprus, as well as attempts to enforce judgements from these courts elsewhere in the EU, including the UK. There has been at least one successful case to enforce rulings in the UK, putting at risk property owned in the UK.

The leaders of both communities are currently in negotiations to try to solve the Cyprus issue. One key issue is property and the handling of pre-1974 Greek Cypriot title-owned property. Property owners and potential purchasers should also consider that a future settlement of the Cyprus problem could have serious consequences for property they purchase, including the possible restitution of the property to its original owner, in addition to compensation payments. In particular, prospective purchasers should consider the implications of any future settlement on land/property:

in the north that was owned by a Greek Cypriot national prior to 1974

that was subsequently classified as exchange or ‘gift’ land/property by the Turkish Cypriot “authorities”

In addition, purchasers should ensure they are fully aware of the rules in the north of Cyprus in respect of foreigners purchasing property in the north of Cyprus including the requirement to obtain consent to the transfer of property. Even when purchasing Pre 1974 Turkish title land, you may still be refused permission to purchase the land/property and no reason for the refusal may be given.

On 20 October 2006, an amendment to the Republic of Cyprus criminal code relating to property came into effect. Under the amendment, buying, selling, renting, promoting or mortgaging a property without the permission of the owner (the person whose ownership is registered with the Republic of Cyprus Land Registry, including Greek Cypriots displaced from northern Cyprus in 1974) is a criminal offence. The maximum prison sentence is 7 years. The amendment to the law also states that any attempt to undertake such a transaction is a criminal offence and could result in a prison sentence of up to 5 years. This law is not retrospective, so will not criminalise transactions that took place before 20 October 2006.

Furthermore, documents relating to the purchase of property in the north of Cyprus will be presumed by the Cypriot authorities to relate to the illegal transfer of Greek Cypriot property and may be subject to confiscation when crossing the Green Line. Anyone found in possession of these documents may be asked to make a statement to the Cypriot authorities and could face criminal proceedings under the 20 October amendment. Any enquiries regarding the scope of this law should be made to the Republic of Cyprus High Commission in London or to the Ministry of Foreign affairs for the Republic of Cyprus:

 

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