Cyprus is in hot water for hampering European nationals from buying a coveted second home on the island.
The European Commission warned it would take legal procedures if the government did not lift restrictions preventing EU citizens from purchasing a holiday home.
The commission argued that the restrictions, which were supposed to stay in place for only five years after Cyprus joined the EU in 2004, violate treaty rules on the free movement of capital.
Cyprus had secured a five-year derogation rather than a preferred permanent one- to maintain imposing restriction, but now Brussels expects it to fall in line. If Cyprus does not repeal these restrictions, it would eventually end up before the European Court of justice, which could apply fines to force a change in the law.
The government has been given two months to “take satisfactory measures to remedy the infringement of EU law”
“ Free movement of capital is at the heart of the single market and constitutes one of its `four freedoms,” the commission said.
“for citizens, it means the ability to undertake a range of operations aboard, such as opening a bank account, buying shares in non-domestic companies, or purchasing real estate,”
Brussels has urged Cyprus to respect rules that give EU nationals, as well as from Iceland, Norway and Liechtenstein, the right to buy a second home in Cyprus without restrictions.
“Since Cyprus has not adopted any new legislation repealing or amending the above-mentioned restrictive rules, the commission is of the opinion that Cyprus infringed its obligations under EU Treaty rules on the free movement of capital.”
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Tags: Cyprus is Holiday island, cyprus is second home, cyprus joined the EU in 2004, Holiday island Cyprus, Iceland, Liechenstein, Norway, second home in cyprus, the european commission, the European court