Deputies managed to withstand the intense lobbying pressure from the banks but mostly the Bar Association in not moving to suspend or amend the law stopping the imprisonment of people who defaulted on their debts, in line with European practice.
In a written statement, the Bar Association suggested that the decision was wrong and had been taken in haste.
“This decision and the enforcement of the legislation creates serious problems in transactions and repercussions to the country’s economy,” the association said.
The law was passed in March 2004, but its enforcement was suspended until June 15 this year, to give time for measures to be put in place to enable creditors to collect what’s due to them in the absence of the jail threat.
The Bar Association is concerned that people owing money will no longer feel obliged to pay up if the threat of prison is removed. Others, however, propose that courts could secure a writ to seize a person’s assets (houses or plots of land) without any need for incarceration. As things stand now, they add, someone could lose both their property and end up behind bars.
The Bar Association suggested the law be amended so that before a person was jailed, a court could look into their financial situation and decide accordingly.
Lawyers said the cases concerning jailed debtors were few and only involved people who neglected or omitted informing the court about their inability to make good on their payments.
But House Legal Affairs Committee chairman Ionas Nikolaou said that the committee had unanimously decided not to make any changes. Speaking after the meeting, Nikolaou said it was now up to the government to take any initiatives.
Parliament insists on its initial decision, which was taken last year, to do away with jailing debtors from June 15, 2005, he added.
On top of that the committee decided to set up a committee, made up of one representative from each party, that would hold talks with all parties involved in a bid to modernise, reassess, and implement measures regarding the execution of court orders, the aim being to draft a bill by October that would be forwarded to the Plenum for approval.
