In a report, the Audit Office notes serious delays in the development of mooring facilities for recreational boats. While the sites remain tied up, preventing the state from using them for other purposes, the private beneficiaries do not pay any fees, even though they “demonstrably derived a benefit.”

The Auditor General’s remarks on the report:

Recreational Boat Mooring Areas were established with the aim of boosting maritime tourism and attracting investment through the organized development of the coastal and marine areas of the Republic of CyprusRepublic of Cyprus. In this context, the government proceeded to designate specific maritime areas and establish a licensing process through which private individuals acquire rights to develop and manage the relevant projects.

Significant Delays

The audit shows that, despite several years having passed since the designation of these areas and the submission of applications (2018–2019), the implementation of the projects has faced significant delays.

Consequences of Prolonged Stagnation

The passage of time without substantial progress in the permitting and implementation of the projects results in public maritime areas remaining tied up for long periods of time, potentially depriving the state of the ability to utilize them for other purposes in the public interest.

At the same time, the data examined indicate that holding the relevant permits may yield financial benefits to the licensees, either by increasing the value of the developments or by utilizing them in the context of business transactions.

No Consequences for Beneficiaries

The concern of the competent authorities, as well as our Agency, was whether the legislation provided for an obligation on the part of the licensees to pay an annual fee from the start of the licensing process (and not only after the project became operational), especially given that the beneficiaries were demonstrably deriving a benefit.

The position of the Legal Service

The Legal Service, upon examining the matter, concluded that imposing the Annual Fee before the lawful commencement of operations at a site could be considered a particularly onerous and potentially unconstitutional measure.

The Need for Immediate Legislative Action

It was determined during meetings with the relevant authorities that, given the position of the Legal Service, the issue could be resolved only through legislative action to establish a differentiated (lower) annual fee for the period until all required permits are secured.

Despite the above consensus, no relevant bill has been introduced to date, with the result that the sites remain reserved without the beneficiaries paying an annual fee.

At the same time, the Audit Office considers it necessary to establish clear consequences in cases of unjustified delays. The competent authority should have the power to revoke the relevant permits or initiate the forfeiture of the sites when beneficiaries, through their own fault, fail to comply with their obligations and timelines.

Only through a clear, balanced, and enforceable framework can the protection of the public interest and the effective utilization of these specific development sites be ensured.

View the full report here.