(1)

Regulation (EU) No 472/2013 applies to Member States already in receipt of financial assistance, including those from the European Stability Mechanism (ESM), at the time of its entry into force.

(2)

Regulation (EU) No 472/2013 sets the rules for the approval of macroeconomic adjustment programmes for Member States in receipt of financial assistance; those rules need to be consistent with the provisions of the Treaty establishing the ESM.

(3)

Upon a request of 25 June 2012 by Cyprus for financial assistance from the ESM, the Council decided on 25 April 2013 by Decision 2013/236/EU (2) that Cyprus was to rigorously implement a macroeconomic adjustment programme.

(4)

On 24 April 2013, the ESM Board of Governors decided to grant, in principle, stability support to Cyprus and approved the Memorandum of Understanding on Specific Economic Policy Conditionality and its signing by the Commission on behalf of the ESM.

(5)

Following the entry into force of Regulation (EU) No 472/2013, the macroeconomic adjustment programme was adopted in the form of a Council Implementing Decision (3). For reasons of legal clarity and legal certainty, the programme was readopted on the basis of Article 7(2) of Regulation (EU) No 472/2013. The substance of the programme remained identical to the one approved by Decision 2013/236/EU, but also incorporated the results of the review carried out in accordance with Article 1(2) of that Decision. At the same time, Decision 2013/236/EU was repealed.

(6)

Council Implementing Decision 2013/463/EU was already amended by Decision 2014/169/EU and Decision 2014/919/EU. In the light of the latest developments, it should be amended again.

(7)

In accordance with Article 1(2) of Implementing Decision 2013/463/EU, the Commission, in liaison with the European Central Bank (ECB) and the International Monetary Fund (IMF), has conducted the sixth review to assess the progress of the implementation of the agreed measures as well as their effectiveness and economic and social impact. As a consequence of that review, changes should be made in the areas of financial sector reform, fiscal policy and structural reforms, reflecting the steps taken by the Cypriot authorities by the first quarter of 2015, in particular with regard to: (i) continuing to closely monitor the liquidity situation of the banking sector; (ii) streamlining the regulation and supervision of insurance companies and pension funds; (iii) further measures to strengthen the banks' management of non-performing loans and ensure long-term sustainable restructuring solutions, including targets for the work-out of non-performing loans and a strategic default study; (iv) the submission of a legal proposal enabling the sale of loans; (v) the presentation of a legal proposal ensuring the transfer of issued title deeds without delay while safeguarding against abuse; (vi) the monitoring on a continuous basis of the implementation and performance of the insolvency and foreclosure frameworks, ensuring that they support their objectives and principles; (vii) to reflect the fiscal performance in the first quarter of 2015, a revision of the 2015 primary balance target to a surplus of at least EUR 264 000 000 (1,5 % of GDP) and further adjustments to the primary surplus target for 2016-2018, also to remain in line with the adjustment path prescribed by the Stability and Growth Pact; (viii) the full implementation of a National Health System (NHS) by 2017; (ix) the operationalisation of the new integrated tax agency by setting up a single registration process and approving a new tax procedure code; (x) the adoption of a plan for the public administration reform leading to the improvement of the wage-setting mechanism, the introduction of a new staff-appraisal and promotion system and an increase in staff mobility; (xi) the consolidation of disability and student benefits; (xii) the inclusion in housing-market regulations of further requirements to accelerate the issuance of title deeds; (xiii) the preparation of a study as input for the national tourism strategy, as part of the Action Plan for Growth; and (xiv) the choice of an energy regulatory regime and market organisation and further progress on the unbundling of the Electricity Authority of Cyprus (EAC).

(8)

Throughout the implementation of Cyprus's comprehensive policy package, the Commission should provide additional policy advice and technical assistance in specific areas. A Member State subject to a macroeconomic adjustment programme experiencing insufficient administrative capacity may seek technical assistance from the Commission, which may constitute, for that purpose, groups of experts.

(9)

The Cypriot authorities should seek the views, in accordance with current national rules and practices, of social partners and civil-society organisations in the preparation, implementation, monitoring and evaluation of the macroeconomic adjustment programme,

(1)

Paragraph 5 is replaced by the following:

(*1)  Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014, p. 190)."

(*2)  Directive 2014/49/EU of the European Parliament and of the Council of 16 April 2014 on deposit guarantee schemes (OJ L 173, 12.6.2014, p. 149).’."

(2)

The following paragraph is inserted:

(3)

In paragraph 8, point (h) is replaced by the following:

(4)

Paragraphs 12 and 13 are replaced by the following:

(5)

Paragraph 16 is replaced by the following: