Three proposed bills aimed at enhancing consumer and business protection against abusive clauses in bank contracts will take centre stage in February as the House plenum prepares to vote on the legislation.

The first bill, submitted by Akel MPs, seeks to enhance transparency and comparability of fees imposed on accounts held by very small enterprises. It also aims to streamline account payments within Cyprus and facilitate the opening of basic payment accounts.

The second proposal, submitted by Disy MPs, focuses on strengthening consumer rights during contract negotiations and transactions with banks.

The third bill, proposed by the Green Party, seeks to amend the consumer protection law to ensure contracts signed before the law’s enactment are scrutinised under the updated framework.

During Tuesday’s session of the House energy committee, members decided to submit the bills to the plenum for voting next month. However, reservations were expressed regarding the first and third proposals, while discussions on Disy’s bill have concluded, making it ready for submission.

The attorney-general’s office expressed constitutional and EU law concerns about Akel’s proposal. Representatives from the finance ministry also suggested that a study be conducted before its submission, given that the bill involves integrating an EU directive into national law.

They emphasised the need to clearly define the basic services required by very small enterprises and warned of potential risks to fiscal stability.

Financial Ombudswoman Valentina Georgiadou supported the bill’s intent but noted that the estimated €2 million in revenue for small and medium-sized enterprises (SMEs) might be overstated. A representative of the Central Bank acknowledged the bill’s potential benefits for businesses but cautioned that it could negatively impact bank revenues.

The banking association also voiced reservations.

Regarding the Green Party’s bill, MP Stavros Papadouris highlighted delays in addressing cases involving abusive loan clauses. He noted that some cases sent to the attorney-general’s office for investigation have been pending for over four years.

He said EU directives gave two options for abusive clauses: Either the clauses are removed and the contract remains in place, or the contract is terminated.

Papadouris said it was odd that on the one hand the Consumer Protection Service was saying contracts could not be contested and the complaints were terminated and on the other hand the financial ombudsman’s office was issuing decisions which the banks did not accept, forcing the complainants to take them to court.

A representative of the attorney-general’s office confirmed that the issue is under review but could not say when its report would be ready.