The Consumer Protection Service Authority of Cyprus announced the adoption of an Administrative Fine against a known land development and construction company in Cyprus for breach of the Unfair Terms of Consumer Contracts Law.
The Decision concerns an investigation conducted by the Director of the Service in relation to the existence of unfair terms in a contract for the purchase and sale of immovable property. The Director, exercising the powers conferred on him by the Law, has decided that certain terms of the contract in question contravene the provisions of articles 5 (1), 5 (4) and 7 of the Law and are therefore abusive and / or opaque.
Among other things, these conditions included:
- The obligation for consumers to fulfill their obligations to repay the total amount of the debt to the company before it fulfils its own obligations, namely to transfer the ownership title of the property to them.
- The imposition on consumers of disproportionately high penalty (default interest) in case they delay the payment of any installment.
- The burden on consumers with taxes and charges that would have to be paid after the transfer of ownership.
- The obligation for consumers to sign a management agreement for the common areas of the property, which was not attached to the contract of sale, by binding them on terms that they could not know.
The aforesaid obligations imposed by the Property Developer through the contracts of sale that was providing its’ purchasers with for execution have been in violation of the Unfair Terms of Consumer Contracts Law of Cyprus and thus the said developer has been fined accordingly.
It is highly important that prior to any real estate purchase in Cyprus, or elsewhere, you need to consult a property lawyer in order to ensure that such, and many others, unfair clauses and provisions are not included or imposed against you.
For more information about Real Estate and Property Law please visit our page here.
For the Consumer Protection Authority of Cyprus you may visit their webpage here.
