The EOA of Nicosia gave the green light to the Council for the Study of Derogations (SYMEPA) to approve, under conditions, the legalization of a banquet hall in Nicosia, which also operates as a music and dance center without, according to the Audit Service, having secured the required planning and building permit.
At the same time, it does not have a final approval certificate and conditions that were set in a derogating permit issued in the past have not been applied.
In a preface by the Auditor General, reference is made to a Special Report issued in 2025 regarding the licensing of a building for public use in the District of Nicosia, which operates as a music and dance banquet center.
He emphasizes that from 2018 onwards, six urban planning applications have been submitted and eight years later, the process continues, without the effective restoration of legality having been achieved, revealing the ineffectiveness of the state's procedures.
With this Memorandum, Mr. Papaconstantinou continues, we return to the same case, to examine what followed after the publication of the Report and, above all, whether the state managed, even after the fact, to restore legality.
He further states that this case is an essential test of the state's ability to react when an illegality is known to both the competent authorities and society. He notes that if legality is not restored even in such a case, reasonable concern arises for those that are not controlled or are not widely known.
The audit, the Auditor General adds, showed that, despite the publicity of the issue, the state failed to enforce the law. Moreover, sending enforcement notices, without taking other measures, did not lead to a substantial restoration of legality.
Mr. Papakonstantinou also records the following:
-The state's practice of examining and licensing arbitrary developments after the past is a counterproductive model, which leads to cases such as the present one, where six applications for planning permission have been submitted to date and seems to act as an excuse by the competent authorities for not taking administrative and/or judicial measures.
-The concern of our Service is intensified by the low penalties provided for urban planning and building violations as well as by the delays in the adjudication of cases, which may make the illegal start of construction work practically without substantial consequences.
-In addition, the withdrawal of court cases by the competent authorities, when a building permit is obtained ex post, weakens the application of the legislation and reduces its deterrent effect.
At the same time, the whole situation creates conditions of unequal competition since the offenders gain a comparative advantage over the law-abiding ones. This sends out particularly negative messages, which gradually erodes citizens' trust in the state.
The claim that the current legislative framework does not provide sufficient tools for more drastic intervention, even if it is true, cannot be a permanent justification. Competent authorities should make full use of the available instruments and, where they prove to be insufficient, seek to strengthen them in good time through proposals to the legislature.
Otherwise, the limited and superficial management by the competent authorities essentially maintains the illegalities and leads, among other things, to the waste of public resources for the continuous treatment of their consequences.
In the summary of the findings of the Audit Office that wear the 2025 Report, the following are also recorded:
At the same time, the whole situation creates conditions of unequal competition since the offenders gain a comparative advantage over the law-abiding ones. This sends out particularly negative messages, which gradually erodes citizens' trust in the state.
The claim that the current legislative framework does not provide sufficient tools for more drastic intervention, even if it is true, cannot be a permanent justification. Competent authorities should make full use of the available instruments and, where they prove to be insufficient, seek to strengthen them in good time through proposals to the legislature.
Otherwise, the limited and superficial management by the competent authorities essentially maintains the illegalities and leads, among other things, to the waste of public resources for the continuous treatment of their consequences.
In the summary of the findings of the Audit Office that wear the 2025 Report, the following are also recorded:
Failure to follow the prescribed procedure
The start and completion of the works took place without securing the necessary permits.
During the process of ex-post licensing, a gradual modification of basic conditions set in the derogating planning permit was found, regarding:
(i) the concession of a plot to the State,
(ii) the area of the cinema space, and
(iii) the demolition of illegal buildings.
(i) the concession of a plot to the State,
(ii) the area of the cinema space, and
(iii) the demolition of illegal buildings.
The Council of Ministers had set as a condition the demolition of illegal buildings before a planning permit was issued, however the term was differentiated by the Department of Urban Planning.
The Deputy Ministry of Tourism granted a license to operate a center as a restaurant, without having previously obtained a certificate of approval for the development, which is a prerequisite.
The premises, according to the enforcement notice sent by the Town Planning Department in May 2024, operate as a banquet hall in the total area of the building, hosting events that are classified in the category of music and dance center activities, without securing the required planning and building permits. It is also not documented that the approved space is actually used for the intended cinematic use.
The licensing of developments that are erected and operated without having previously secured the relevant permits, creates conditions of unfair competition, circumventing the equal operation of the market.
The Auditor General indicates that not all the administrative and judicial measures that are provided for in similar cases have been taken and which, in any case, do not always prevent illegalities.
What does the EOA Nicosia answer?
Responding to the remarks of the Audit Office and commenting on a report that essential conditions of the Planning Permit have not been implemented, such as the operation of a space for cinematic uses, the EOA, states that the specific space is configured and distinct, while it has been used in the past for filming a show. It also indicates that non-use (i.e. inactivity and not use in any other unauthorized way) of a planned development is not illegal. He also mentions that the function of the development, as a banquet hall, is used throughout the building, but not always.
The EOA's reply to the Auditor General also states the following:
I wish to inform you that the pending applications have been thoroughly evaluated by the EOA Nicosia and the report of the Development Licensing Directorate has already been sent to SYMEPA on 18/05/2026. This report records the positive (under conditions) views of the EOA Nicosia following the relevant decision of the Licensing Committee (22/01/2026) and the Board of Directors of the EOA Nicosia (26/03/2026).
The Auditor General indicates that not all the administrative and judicial measures that are provided for in similar cases have been taken and which, in any case, do not always prevent illegalities.
What does the EOA Nicosia answer?
Responding to the remarks of the Audit Office and commenting on a report that essential conditions of the Planning Permit have not been implemented, such as the operation of a space for cinematic uses, the EOA, states that the specific space is configured and distinct, while it has been used in the past for filming a show. It also indicates that non-use (i.e. inactivity and not use in any other unauthorized way) of a planned development is not illegal. He also mentions that the function of the development, as a banquet hall, is used throughout the building, but not always.
The EOA's reply to the Auditor General also states the following:
I wish to inform you that the pending applications have been thoroughly evaluated by the EOA Nicosia and the report of the Development Licensing Directorate has already been sent to SYMEPA on 18/05/2026. This report records the positive (under conditions) views of the EOA Nicosia following the relevant decision of the Licensing Committee (22/01/2026) and the Board of Directors of the EOA Nicosia (26/03/2026).
