At the beginning of next week, the President of the Republic, Nikos Christodoulides, is expected to make his final decisions on the 12 legislative regulations that were voted in series by the Parliament and concern foreclosures, the insolvency framework and guarantors.
President Christodoulidis has until April 21 to proceed with his next moves. That is, either to sign the laws, or to decide whether to refer them back to Parliament or whether to proceed with their direct reference to the Supreme Court.
As everything shows, the scene will become clear on the 23rd of the month, the day on which the self-dissolution of the Parliament is scheduled, in view of the parliamentary elections on May 24.
According to information from "F", there is expected to be a combination of decisions by the President: Some of the legislation will be referred back, as it is considered that they are not politically correct and present practical problems in their implementation, which can be resolved if the Parliament wants to make some amendments. Some other legislations, however, are considered to violate articles of the Constitution and the European acquis and for them it is most likely that a petition will be made to the Supreme Court, so that it can rule on it.
President Christodoulidis is expected to sign the two bills concerning the debt confirmation mechanism, provided by the Financial Commissioner, with the addition of the possibility of debt restructuring. Based on the legislation, the Commissioner's decisions up to €20,000 will be binding. for complaints against financial companies, which, in turn, will be able to appeal to Justice even for the substance of the decision. In addition, borrowers will be able to apply to the Financial Commissioner for confirmation of the debt, when they receive the "I" type letter, instead of the "IA" type letter.
Constitutional hurdles
The legislation, as passed by the Parliament, went through an initial audit by the technocrats of the Ministry of Finance, who found that some of them cannot be implemented, as some amendments concern the same article and contradict each other. In addition, points of unconstitutionality were identified, such as the principle of free contracting, but also the principle of separation of powers.
In the last 24 hours, the legislation has been forwarded to the Legal Service, which, by the end of the week or the beginning of the next, will communicate its positions to the Presidential Palace. At the same time, the Attorney General will inform the President of the Republic on how the legislation is handled.
According to a competent source, the legal and constitutional issues are mainly found in the regulation concerning the freezing of foreclosures until the end of the year, as well as in access to Justice for issues of unfair clauses and the amount of debt. In addition, there are concerns that the courts will not be able to respond to the large volume of cases.
Reservations and concerns
As we were told, there are also reservations about the legislation by which district court judges can hear disputes of a financial nature and set aside foreclosures, with decisions being issued within 12 months. Otherwise, if the trial of the case is not completed, an extension of the setting aside will be requested for another year. There may be reactions from the judicial service, as it can be interpreted that the Parliament interferes with its competences, obliging the courts to complete the trial of such cases within 12 months.
Another piece of legislation that appears to be flawed concerns the prohibition on banks charging additional interest in the event that the amount of credit facility due, including interest, amounts to twice the original debt. The problem identified is that it concerns existing loan agreements (retroactivity of arrangements). Issues also seem to be discussed competently regarding the legislation related to guarantors.
Referrals are increasing
The decisions on the foreclosures will follow the five referrals of laws, which will be discussed today by the Plenary Session of the Parliament. It is estimated that on the 23rd of the month, the scene of 2016 will be repeated, when, before the self-dissolution of Parliament, 13 pieces of legislation were referred back.
It is worth noting that among the referrals that the Plenary Session of the Legislative Body will consider today is the legislation that strengthens the legal framework for unfair terms. According to the regulation, contracts concluded before the date of entry into force of the laws repealed by the basic legislation are examined with the provisions of the specific legislation, with a view to extending the protection of borrowers.
Constitutional problems are identified in the referral, as the regulation will have retroactive effect, i.e. it gives the possibility of imposing sanctions retroactively and affects contractual rights based on a legislation that was not in force when the contracts were concluded. In addition, it conflicts with freedom of contract and EU law.
At the same time, the referral of the law that determines how to compensate the surpluses of electricity produced by self-consumers of energy from photovoltaics, in the context of a support scheme aimed at encouraging the use of renewable energy sources, will also be discussed.
According to the referral, the law conflicts with the Constitution, as it burdens the Standing Fund of the Republic and increases budget expenses.
