Filenews 8 June 2021
The serious issue of unfair terms in consumer contracts with banking institutions, which have led thousands of borrowers to financial ruin in Cyprus, was included on the initiative of MEP Costas Mavridis (DIKO - S&D) in a European Parliament report.
In particular, the Report notes with concern the fact that some Member States (with a typical case Cyprus) 'have not effectively implemented Directive 93/13/EEC on unfair terms/conditions in contracts with consumers, in accordance with the European Commission's assessment'. It also states that this 'has a huge negative impact on consumers and harms fair competition'. The European Parliament therefore 'calls on the European Commission to examine in detail the unfair terms and unfair practices applied, in particular by the banking sector, to consumer contracts and to ensure the effective and rapid implementation of the relevant directive, using all the means at its disposal'.
It is recalled that the European Commission initiated infringement proceedings against the Republic of Cyprus in 2013 after having established that the rules on the administration of justice in Cyprus are not in line with European legislation on unfair terms/conditions and unfair practices. In addition, it found a refusal by the Cypriot Government to fulfil its obligation to effectively implement European laws on illegal-abusive terms and practices. Due to the Stubborn Refusal of the Government, the Commission has renewed the procedure in 2019, with the possibility of imposing sanctions on Cyprus if the case is referred to the European Court of Justice.
In a statement, Mr Mavridis pointed out the following:
"For many years, I have documented the huge lack of justice in the face of decades of crime against Cypriot society and economy, in violation of European law. As the European Parliament, which defends European citizens and the rule of law, we recognise the serious consequences of the illegal/abusive clauses applied by banking institutions towards borrowers, which is why we call on the European Commission to ensure, directly and effectively, that the relevant Directive is implemented by all Member States without exception.
Especially in Cyprus, the reality is painful. The Government continues to stubbornly refuse to fulfil its obligation to effectively protect society from banking irregularities, and moreover, the Cyprus Courts do not take advantage of European legislation and relevant guiding decisions of the Court of Justice of the EU. This cannot be considered the rule of law'.
