Action brought on 22 December 2011 — European Commission v Republic of Cyprus

(Case C-662/11)

2012/C 73/33

Language of the case: Greek

Parties

Applicant: European Commission (represented by: E. Montaguti and G. Zavvos)

Defendant: Republic of Cyprus

Form of order sought

Pleas in law and main arguments

The Commission submits that, in view of Article 24 of, in conjunction with Annex VII to, the Act of Accession of the Republic of Cyprus to the European Union, the authorities of the Republic of Cyprus had to bring into force by 1 May 2009 at the latest the laws, regulations and administrative provisions necessary in order that the restrictions in force in its national legislation placed upon the acquisition by EU/EEA nationals of residences for secondary use are removed. Those restrictions constitute a direct infringement of the free movement of capital as laid down in Article 63 of the Treaty on the Functioning of the European Union.

The Cypriot Government sent a draft law concerning amendment of the restrictions in force, and maintains that it has been submitted for approval to the Council of Ministers with the objective of it being examined as rapidly as possible and being transmitted to the parliament to be voted upon.

The Commission observes that the infringement of a freedom enshrined by the Treaty by provisions of a Member State’s national legislation can be removed only by the adoption of equally binding provisions. Therefore, the enclosing of a mere draft law, which has not acquired any legislative force, with the Republic of Cyprus’s letter in response cannot be equated to a binding act removing the provisions in force regarding the acquisition by EU/EEA nationals of residences for secondary use.

The Commission submits that, by not adopting the laws, regulations and administrative provisions necessary for the removal of the restrictions existing in its national legislation that concern the acquisition by EU/EEA nationals of residences for secondary use or in any event by not notifying those provisions to the Commission, the Cypriot Government has failed to fulfil its obligations to comply with Article 24 of the Act concerning the conditions of accession of the Republic of Cyprus, in conjunction with Annex VII to that act relating to the transitional provisions that concern Cyprus.