THE SUPREME Court last Tuesday declared unconstitutional the 2000 law forcing investment companies to invest 80 per cent of their capital in the shares of companies listed on the Cyprus Stock Exchange. As a direct result of complying with this absurd piece of legislation, approved unanimously by the House of Representatives, investment companies lost a staggering £150 million, which sent the value of their own shares plummeting.
Investment companies will now file law suits against the state seeking damages. They have been encouraged to follow this course of action by chairman of the Capital Markets Commission, Marios Clerides, whom Phileleftheros quoted as saying the following: “The decision of the Supreme Court paves the way for investment companies to take legal action against the state and seeking to recover the funds they had lost.” In other words, the taxpayer will be asked to foot the bill for the £150 million worth of losses caused by the idiotic law passed by our deputies.
On May 13, 2001, two weeks before the parliamentary elections, this column said the following about our deputies’ populism:
“The legislation forcing investment companies to invest 80 per cent of their capital on shares listed on the CSE, and setting a deadline of June 2001 for this to happen, is a case in point. I doubt there is any other country in the world which has approved such an absurd law. It is unheard of for a country’s legislature to dictate, through legislation, how a company will use its funds.
“And if a company obeying this law buys shares instead of, say real estate, thus incurring heavy losses, what will it say to its shareholders at the end of the year? ‘Go to the House of Representatives and ask for compensation, because it decided how we should invest our money?’ How foolish can you be? And how on earth could DISY, the party representing economic liberalism, play a leading role in imposing a measure that goes against the grain of free market thinking?
“Sometimes I wonder if the European Union representatives who visit the island and follow these weird and ludicrous goings-on ever take us seriously. What relation does this law have to the EU harmonisation drive? I also wonder whether all those thousands of CSE victims will take into account, when they turn up to vote in a fortnight, that many of the candidates featuring on their ballot paper are the people responsible for their tribulations?”
I have no claims to any legal knowledge. In fact I have not ever walked past a law school. But did someone have to be a lawyer to see what was obvious to anyone with basic common sense – that the law was irrational and unconstitutional. There are 56 deputies, of whom at least 15 are lawyers. All of them parade through radio and TV studios on a daily basis, advertising their wisdom and their omniscience. The then president, who ratified the law, never missed an opportunity to tell us what a legal giant he was.
If this were a country characterised by ethical political behaviour and dignity (like Japan for instance) half the deputies – at least the lawyers – would have committed suicide after the public slap in the face they received from the Supreme Court, while the rest would have given up their seats and lived the rest of their life as hermits.
In Cyprus, nothing of the sort could ever happen. In Cyprus, those responsible for the fiasco would not commit suicide nor would they go into hiding. On the contrary, they are currently conducting an investigation to establish who was responsible for the CSE bubble. DISY deputy Christos Pourgourides, who has been championing the investigation, boasted a few days ago that he would put in the dock some 500 directors of 70 public companies! Yet the first man who should sit in the dock is Pourgourides, who caused losses of £150 million by voting through the lunatic law. As for his party colleague, Prodromos Prodromou, the leading player of this unprecedented fiasco, instead of apologising to his victims, he has been making threatening statements against the investment companies, by citing the ludicrous investigation by the legislature.
I have to say that I do not feel any sympathy for all those victims of our deputies’ criminally irresponsible behaviour. Two weeks after the article quoted above and two weeks before the deadline for compliance with the law given to the investment companies, the victims went to polling stations and voted back in the deputies who had approved the lunatic law; the law which increased their losses. Under the circumstances, they deserve just about as much sympathy as all those who voted for “the big and substantial change” promised by Papadopoulos and Christofias, and who are now in tears because of the unprecedented attack on their standard of living.
Never has the adage ‘Every people has the leadership it deserves’ been more appropriate.
