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Cyprus: Registry of dishonoured cheques

Since 2003, the Central Bank of Cyprus has maintained a database known as the Central Information Registry (CIR) to record details of issuers of dishonoured cheques. It is administered by a committee, which has the sole competence to register, maintain, update and delete data regarding registered persons.

A dishonoured cheque is any cheque drawn on any bank or co-operative credit company which remains unpaid after representation to the paying bank or co-operative credit company 15 days after it was first presented for payment due to the lack of funds to meet it, or due to its issuer having ordered the payment institution concerned to stop payment.

All banks and co-operative credit companies are required to submit data on dishonoured cheques each month to the Central Bank of Cyprus for registration in a preliminary list. Once it has been included in the preliminary list as dishonoured, a cheque cannot be deleted, even though it may subsequently have been settled.

Any individual or legal entity will automatically be registered in the CIR if they issue three or more dishonoured cheques, or fewer dishonoured cheques amounting to €2,000 ($2,100), in the course of a year. Persons who are convicted of an offence relating to the issuing of a dishonoured cheque for any amount are also registered in the CIR. Directors of companies issuing dishonoured cheques may also be added to the register if they have caused or participated in the issuing of the dishonoured cheque.

Banks and co-operative credit companies are obliged to freeze all current accounts maintained by persons included in the CIR, and to notify the persons concerned. No withdrawals or debits are allowed in relation to such accounts, except for the payment of debts owed to the institution concerned, to pay insurance premiums for any insurances issued for its benefit, or to meet dishonoured cheques which were issued before the issuer was notified of registration in the CIR.

No bank or co-operative credit company may open a current account for anyone who is registered in the CIR.

Deletion from the CIR is possible only after three years from the date of registration, and only after a year has elapsed since all dishonoured cheques issued by the person or entity concerned have been settled. The administrative committee has discretion to allow removal within less than three years if all dishonoured cheques have been settled within a period of one month from the date they were recorded as dishonoured and at least a year has passed since the last dishonoured cheque was settled.

Details of deleted individuals and entities are retained indefinitely and are accessible to all banks and co-operative credit companies.

These arrangements have contributed to a sustained decline in both the number and the value of dishonoured cheques in the period since they were introduced.

Elias Neocleous

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