Mon­day dead­line for fore­clo­sures

Financial Mirror (Cyprus) - - FRONT PAGE -

The joint House Fi­nance and In­te­rior Com­mit­tees have given the gov­ern­ment a week to re­spond and in­cor­po­rate ad­just­ments to the pack­age of four pieces of leg­is­la­tion that com­prise the law on fore­clo­sures, the de­lays of which prompted the IMF tio sus­pend its pay­ment of 86 mln euros as part of the bailout deal and post­poned the ar­rival of Troika in­spec­tors.

The par­lia­men­tary com­mit­tees dis­cussed the four bills pre­sented by the gov­ern­ment on Tues­day and asked that th­ese be re­turned with amend­ments by next Mon­day, a day be­fore the ar­rival of Troika of­fi­cials, as re­gards the safety net for guar­an­tors in the case of in­sol­vency by the bor­rower and fore­clo­sure of his prop­erty.

The four bills dis­cussed by MPs re­lated to the reg­u­la­tion of in­sol­vency coun­cilors, the ex­am­in­er­ship of re­struc­tured loans by vi­able busi­nesses, an im­prove­ment on the reg­u­la­tions for re­ceiver­ship of com­pa­nies and an amend­ment to the ex­ist­ing law on bank­rupt­cies.

The new bill stip­u­lates that after the pas­sage of three years un­der re­view, the in­sol­vent per­son is re­lieved of all his debts and no longer deemed in­sol­vent, hav­ing sur­ren­dered his prop­erty, ex­cept for as­sets deemed nec­es­sary to him and his fam­ily. The in­sol­vent per­son will also be obliged to sur­ren­der any amount from in­come beyond the ba­sic amount needed for his fam­ily, to sat­isfy cred­i­tors over a three year pe­riod.

Also, the sta­tus of guar­an­tors re­mains the same in the sense that any re­lief for the in­sol­vent per­son does not re­lieve the guar­an­tor.

The next mis­sion of in­spec­tors from the Troika of in­ter­na­tional lenders is now ex­pected to re­turn on Jan­uary 27 for its sixth re­view of the fi­nan­cial as­sis­tance pro­gramme, hav­ing post­poned its ar­rival when par­lia­ment passed a new bill that would de­lay im­ple­men­ta­tion of the fore­clo­sures bill un­til Jan­uary 30.

The Troika mis­sion will fo­cus on the in­sol­vency frame­work, a “crit­i­cal pri­or­ity” for the pro­gramme at this stage, an IMF source was quoted by the state-run Cyprus News Agency as say­ing last week.

“A full re­view mis­sion will be­gin once the sus­pen­sion of the fore­clo­sures law is ex­pired. This is the plan at the mo­ment,” the source said.

The House wanted the gov­ern­ment to sub­mit a pack­age of all five bills of an in­sol­vency frame­work, which was sched­uled to be put into force in Jan­uary 1 to set up a safety net to pro­tect vul­ner­a­ble groups from fore­clo­sure of mort­gaged prop­erty.

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