Cyprus: European Court of Justice importance in ruling on the Cyprus haircut case
Several citizens of the Republic of Cyprus and one company which is based in Cyprus had claimed before the European Court of Justice compensation for the private deposits haircut in Cyprus which occurred in 2013. Their claims had been brought against the European Commission and the European Central Bank. Their claims had been dismissed by the European Court of Justice.
The Court ruled as follows:
(a) Assessing the compensation claims, the Court ruled that the claims must be rejected since the signing of the Memorandum of Understanding (bailout) for Cyprus was in the context of the public interest as aimed by the EU.
(b) The haircut of private deposits did not violate the right to property, as it did not disproportionately and unacceptably interfere with the substance of depositors’ property rights.
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