The Supreme Court, in two separate decisions, held in two Petitions by the President of the Republic, Laws passed by the Parliament, that they are not contrary to relevant European Directives or the Constitution.
Specifically, the decisions, announced on Monday, concern the Social Security (Troika) Law (No. 6) Law of 2021 and the Real Estate Transfer and Mortgage (Amendment) (No. 2) Law, also of 2021.
With regard to the Social Security Law, the Supreme Court, unanimously ruled that "it is not contrary to or inconsistent with Directive 2014/24/EU, Articles 80.2, 122, 125.1 and 179 of the Constitution and the Principle of Separation of Powers and may therefore be enacted."
The amendment was made so that the meaning of the term "employee" for social security purposes includes, in an express and unambiguous manner, employment under a contract for the purchase of services or any other relevant contract, irrespective of the designation attributed to such a contract, and which is characterised by an employer-employee relationship, so that workers enjoy all the rights and benefits, including the payment of their social security contributions, as employees and not as self-employed persons'.
The Court notes that it cannot agree with the Attorney General's position that the Act created a new category of insurable employment entailing an increase in costs.
It states that the Law in question is not contrary to Directive 2014/24/EU and also not contrary to Article 80.2 of the Constitution because it does not cause and does not entail an increase in State expenditure.
The judgment also states that the position of the Attorney General on the violation of Articles 122 and 125.1 of the Constitution "also does not find us in agreement", since the Law in question does not provide for or permit the employment of persons in the public sector, but only regulates the cases in which a person employed in the public sector under a contract of employment or purchase of services is considered an "employee" for social security purposes.
With regard to the Law on the Transfer and Mortgage of Real Estate (Amendment) (No.2) Law of 2021, which was passed by the House of Assembly on 8 July 2021 and reaffirmed after being referred to Parliament by the President of the Republic for reconsideration, the Court unanimously held that "it is not contrary or inconsistent with Articles 26, 30, 58, 61 and 80.2 and, by extension, with Article 179 of the Constitution, nor with the Principle of Separation of Powers and, therefore, may be enacted".
According to the Explanatory Memorandum, the decision states, the purpose of the Act is to amend the Real Estate Transfer and Mortgage Act of 1965 to extend the targeted suspension of the mortgage sale process until October 31, 2021, due to the ongoing and intensifying economic and social impact of the outbreak of the COVID-19 pandemic.
It is stated, inter alia, that the terms used by the Attorney General that extending the suspension until 31 October 2021 "may" result in additional risks for the banks and that it will lead to an increase in the provision for losses on the loans of the former Cooperative Central Bank, which have been transferred to the Hellenic Bank and are covered by the Guarantee Scheme, with a consequent significant increase in the compensation claims of the Hellenic Bank from the Cyprus Asset Management Company, making the activation of the guarantee of the Republic of Cyprus 'likely', provided that, according to the proposal, it fully inactivates the divestment tool, 'not referring to an unavoidable increase in the expenditure foreseen in the budget, either in the near future or at a later date'.
In conclusion, the Court states that "it is not established from the material before us that the Law, which is of short, temporary duration and limited in scope as to its implementation, will have the consequences recommended by the Attorney General, with an implied increase in budgetary expenditure in the sense prescribed by the case law."
Source: CNA
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