President Nikos Christodoulidis has expressed serious reservations about parliament's recent decisions on foreclosures, leaving open what steps the executive may take next, including a possible referral to the Supreme Court.
Politis reported on Wednesday that several of the ten proposals passed by parliament are constitutionally suspect. If the Legal Service reaches the same conclusion, a referral to the Supreme Court on the question of constitutionality becomes a likely next step.
Additional concerns have been raised about the impact on the financial system. Constant changes to the legislative framework increase risk for banks and, by extension, borrowing costs for loan holders. There are also fears that if banks were ever again required, in the event of a major crisis, to manage a large volume of non-performing loans through sale to specialised firms, investor appetite would in all likelihood be absent.
Speaking on the sidelines of the 16th Nicosia Economic Congress, Christodoulidis said: "I am studying this and, as I am obliged to do under the Constitution, I will go back to the institutions because there are institutions in this state. I will make decisions without thinking about the next parliamentary elections, but about the future of our country." The remark captured the degree of unease within the government over the legislation.
Speaking at a roundtable with business leaders, the President also expressed concern about the composition of the next parliament, and was critical of the current House for passing large volumes of legislation at the last minute, including proposals he said lawmakers know to be unconstitutional.
"It is not a sign of seriousness, I am sorry to say, to pass a hundred pieces of legislation at the last minute. What message are we sending as a country? I don't know how many proposals came forward on foreclosures," he said.
"I feel," he added, "that proposals are being passed which they know are unconstitutional, simply so that they can come to me to send them to court and I bear the responsibility. I have no problem with that, I will do it when something is unconstitutional. But we cannot pass proposals that we know are unconstitutional simply to go out and tell people: 'you know, I tried to protect you, in inverted commas protect you, but the government won't sign it.'"