Within the framework of extraordinary measures taken by the Republic of Cyprus, in order to support the economy of Cyprus in these adverse circumstances, the Minister of Finance has issued the ‘2020 Order on Extraordinary Measures by Financial Organizations and Supervisory Authorities’ (the “Order”). According to the Order, the obligation to repay loan installments (including interest) granted by certain financial organizations, is suspended for natural persons, public law legal persons, the self-employed and businesses (the “Beneficiaries”). In order to be eligible the Beneficiaries must (i) not have delayed the payments of their installments for more than 30 days from the day provided by the specific credit facility as of 29 February 2020 and (ii) face financial difficulties as a result of the impact of the pandemic caused by COVID-19.
The suspension of payment of the installments and interest is applicable from the date of issue of the Order, provided that the Beneficiaries have expressly filed an application in writing to use these protective provisions. The financial organizations do not have the right to decline the application, save for where the interested party has delayed payments for more than 30 days as noted above. Moreover, enforcement measures by financial organizations in respect of the above-mentioned credit facilities are also suspended and the non-payment of installments during the suspension does not constitute a breach of the contractual terms of the agreement between the beneficiary and the financial organizations.
For more information and specific advice please contact Demetris Roti, Ioannis Sidiropoulos or your usual contact at Elias Neocleous & Co LLC.