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Legal Relief Fund for investors

16/01/2004 11:02
The political decision of the Finance Minister, Marcos Kyprianou to proceed to the introduction of a Legal Relief Fund, so that investors who had invested in the CSE in 1999-2000 are aided to claim their rights at court, pleased the Investors’ Association PASEXA. PASEXA Chairman, Demetris Hadjipapas told StockWatch on Friday that the Minister’s proposal is in accordance with the “spirit and philosophy” of the Association.

Despite his reservations concerning the provision on the income criteria, Mr. Hadjipapas said that PASEXA’s reaction is “very positive”.

The Finance Ministers’ proposal for the establishment of a Legal Relief Fund was announced by the Cyprus News Agency and ascertained by the Chairman of the House Finance Committee, Aristos Chrysotomou.

Attorney General

According to StockWatch sources, the government is looking forward to the decision of the Attorney General on the content of the proposal, as it will be decisive for its implementation.

According to the relevant sources, the Ministry will have contacts with the Attorney General to exchange views so that the proposal be implemented the soonest possible.

Proposal

On his note, the Finance Minister recommends the allocation of £300,000 - £500,000 to the Fund, which will be managed by the Attorney General and provides for a minimum ceiling to avoid the request of small amounts. The proposal also provides for the imposition of income criteria for the applicants.

Institutional investors such as insurance and investment companies, provident funds, major shareholders, directors and auditors, stockbrokers, brokerages, natural persons – members of the supervisory authorities, civil service officials in the executive and legislative power are not entitled to the aid.

According to the proposal, investors who wish to proceed to a claim, must prepare a preliminary report and submit the relevant documents to the Attorney General. All reports must be submitted within a prescribed deadline.

The Attorney General’s Office will examine the report and will decide whether a legal aid must be granted.

Expenses

The Finance Minister recommends that the allocation of the amount by the Attorney General’s Office is carried out on condition that in case the investor is awarded the aid, the legal costs will be returned to the fund by the investor’s legal advisor.

In case that the legal costs are lower than the legal aid provided by the fund, the investor must undertake the commitment to submit the difference, provided that the aid he/she has received is at least four times the level of difference.

The Finance Minister also recommends that all cash returned will be deposited to the Fund for replenishment until the time when the Council of Ministers decides that there are no more cases.