Anastasiades to seek AG advice on foreclosures freeze constitutionality

President Nicos Anastasiades said on Sunday he would require the opinion of the attorney general (AG), on how to proceed with the law on extending the foreclosure freeze.

Passed through parliament earlier this week, the law provides a foreclosures freeze until the end of January 2023. Finance Minister Constantinos Petrides however called on Anastasiades to send it back to parliament, warning this would have consequences on interest rates, non-performing loans and would make obtaining loans more difficult.

“What matters for the president’s decisions is the advice of his ministers but for the most part, the opinion of the attorney general on whether it is constitutional or not,” Anastasiades said.

“If the AG determines it is unconstitutional, the duty of the president as per the constitution is to refer the law back and possibly have it go to Supreme Court,” he added.

The foreclosures freeze extension – the latest in a series since 2021 – was passed with 32 votes for, 12 against. All MPs bar those from ruling Disy were in favour.

The bill’s sponsors argued it will serve as relief to debtors amid the continuing financial fallout from the coronavirus pandemic and now from the conflict in Ukraine.

The moratorium on foreclosures applies to a debtor’s primary residence valued at €350,000 or less, business premises where the business’ annual turnover does not exceed €750,000, and parcels of land with a value of €100,000 or less.

Petrides called on Anastasiades to send the legislation back to parliament, arguing it rewarded strategic defaulters and will lead to an increase in the stock of non-performing loans, forcing banks to raise their capital provisions. It will also have consequences on Cyprus’ recovery and resilience plan, he said.