ECONOMY

Government at odds with creditors on bankruptcy law

government-at-odds-with-creditors-on-bankruptcy-law

The new bankruptcy law for individuals and enterprises, to apply from January 2021, as well as the “bridge” program for the protection of borrowers’ primary residences will as of Tuesday form part of the government’s negotiations with its creditors.

On the new bankruptcy code, the Finance Ministry and the creditors are at loggerheads over which entity will acquire the main residence of bankrupt borrowers, and whether this entity will be a state body or a private one.

Staff-level talks are taking place under the added pressure of the disagreement over whether the mortgage tranche subsidy system will cover all households hurt by the crisis, as the Greek side proposes, or will only cover the most vulnerable categories, based on specific criteria, as the creditors want.

The bridge program, covering nine months of the interest payments for mortgages of households hurt by the crisis, will replace the protection currently provided to specific categories of mortgage debtors through the online platform at the Special Secretariat for Private Debt, which ceases at the end of this month. The program’s technical aspects are set to be on the table on Tuesday.