Filenews 11 January 2025 - by Angelos Nicolaou
The controversy that broke out in recent days between the Department of Forests and the contractor company Cyfield regarding the project for the improvement of the main road network of Phase A of the Akamas National Forest Park highlights at least the inability of the Department of Forests to manage public works contracts.
As a result of Cyfield's decision to terminate this contract, the Republic of Cyprus lost an amount of €1.2 million related to two letters of guarantee, which were continuously renewed until 15 December 2024. According to "F" information, the Department of Forests made a legal error when it requested the renewal of the guarantees from the contractor, without at the same time contacting the bank with a demand for the liquidation of the two cheques in case of non-renewal of the guarantees.
The first cheque of €900.000 concerns the performance guarantee and the second cheque of €300.000 the deposit.
It is noted that in a letter from the company Cyfield, which remains unpaid for accrued works in Akamas after the suspension of works in December 2023, on December 22, 2024, it warned that the renewal of the two guarantees is taking place for the last time and for a period of one and a half months, which considered reasonable time for completion of works or for termination of the contract through amicable settlement.
Relevant announcements were issued by Cyfield on 9 January 2025 and by the Department of Forests on 10 January 2025, following the public statement of the Minister of Agriculture, Rural Development and Environment before the parliamentary committee on the Environment on 8 January 2025 for the termination of the contract due to the fault of the contractor.
Speaking to "F", the owner of Cyfield, Kyriakos Chrysochoos, said that the company terminated the contract on December 23, 2024 following a written request of the Department of Forests dated June 6, 2024. According to Mr. Chrysochoos, on June 12, 2024, a meeting was held at the office of the director of the Department of Forests, who left in the middle of the meeting, after being informed about the existence of a fire. Since then, notes the owner of Cyfield, there has been no further meeting between the two parties.
Until the termination of the contract, Cyfield had no information on whether the Department of Forests proceeded with the preparation of the final construction plans, based on the legally binding and substantial terms, which were set in the Special Ecological Assessment Report for Phase A of the road network of the Akamas National Forest Park. published by the Department of Environment in March 2024.
According to Mr. Chrysochoos, the decision to terminate the contract was made for two reasons. First, due to the long suspension of operations from December 2023 until today, which far exceeded the 84 days stipulated in the contract and for which the company had agreed that it would have no financial claims. Second, there was non-payment, within the stipulated timeframe of 56 days, of the certificates due and assessed amounts to the company, amounting to €500,000.
