NICOSIA, Oct. 31 (Xinhua) -- Cyprus's High Court ruled on Friday that legislation regulating the repossession of mortgaged properties by the banks was unconstitutional, clearing the way for the eastern Mediterranean island to receive further bailout money from international lenders.
The Court's decision was issued on the request of President Nicos Anastasiades, who challenged the validity of the legislation which had been pushed through parliament by opposition parties.
The Eurogroup and the International Monetary Fund had also dismissed the legislation as violating provisions of a 10-billion-euro bailout agreement (about 12.5 billion U.S. dollars) and put on hold a 456-million-euro tranche and further evaluation of the Cypriot economy.
The country's Attorney-general, Costas Clerides, said that following the Court's unanimous ruling, Cyprus could proceed with its bailout program.
However, the decision ultimately rests with the Troika, the collective name by which the European Commission, the European Central Bank and the International Monetary Fund are known.
Cyprus' 10-billion-euro bailout memorandum provides for the streamlining of the Cypriot economy and the restructuring of the strained banking system. A crucial element of the restructuring is dealing with non-performing loans either through repossessing mortgaged properties or rescheduling loans.
International lenders said the contested legislation negated the purpose of the main law regulating repossessions, aimed at helping banks sell mortgaged properties.
The High Court said it found the laws violated either the basic constitutional rule of the separation of state powers or the rights of having recourse to the courts and entering into private contract.
Government sources said that following the Court's ruling, the Ministry of Finance would tell international lenders that barriers to the assistance program have been lifted.
They added the Troika is expected to notify Cyprus about its return to the island to carry out another survey of its economy. (1 euro = about 1.25 U.S. dollars)
