The Famagusta District Local Government Organization managed to collect approximately €12 million from debtors, following the adoption of stricter measures and a warning that the details of those owing large sums would be made public. Speaking on the Alpha Kalimera program, the Organization’s President, Yiannis Karousos, referred to the initiatives undertaken by the EOA to collect debts, as well as the need for legislative regulation of the so-called “name and shame” policy.
As he noted, when the new administration took office, total debts owed to the Organization amounted to approximately €26 million, with a significant portion of these debts owed by large companies. “The 43 largest debtors to the Famagusta EOA owed approximately 9.5 million euros. The total amount we had to collect was around 26 million,” he noted, adding that approximately 25%–30% of the debtors are classified as habitual defaulters.
ΣΧΕΤΙΚΑ ΑΡΘΡΑ
According to Mr. Karousos, the EOA Council decided to take two key actions aimed at mitigating the problem. The first involves publishing a list of major debtors, primarily companies, while the second links the review of licensing applications to the settlement of outstanding obligations. “If someone owes money to the EOA and submits a license application, their application is set aside until they settle what they owe,” he explained, emphasizing that a business cannot seek to expand its operations while maintaining significant debts to the competent authority. As he noted, following the relevant decisions, several debtors came forward to pay off or settle their debts, with the settlement agreements including interest and fines.
At the same time, the President of the EOA reiterated the proposal for legislative enshrinement of the “name and shame” policy, so that local government authorities can publicly disclose, on an annual basis, the details of companies with significant overdue debts. As he noted, the Organization has obtained a relevant legal opinion and has already submitted a proposal to the relevant parliamentary committee and to the Minister of the Interior. “We want to move forward with enacting ‘name and shame’ legislation. We want them to see their company’s name in the newspapers. We want everyone to know that they aren’t paying,” he stated emphatically.
Regarding the approximately €14 million that remains uncollected, Mr. Karousos noted that legal proceedings have already been initiated, starting with the largest debtors. Cases involving debts between €50,000 and €100,000 are currently being referred to attorneys, while those ranging from €10,000 to €50,000 will follow. He noted, however, that legal proceedings could take six to nine years, making it necessary to find more effective means of collection.
At the same time, the Famagusta EOA is considering the possibility of offering discounts to citizens who have been consistent in their payments during the next fee collection period. The proposal applies to those who have been consistent in meeting their obligations for a specific period of time, possibly the last three years. “In Cyprus, we must reward those who pay on time. The system generally favors those who don’t pay,” said Mr. Karousos, emphasizing that it is unfair for families to struggle to pay even €50 or €100, while large companies carry debts of millions of euros.
