The ownership of many properties is disputed in the north of Cyprus, with thousands of claims to ownership from people displaced in 1974. Purchase of these properties could have serious financial and legal implications. The European Court of Human Rights has ruled in a number of cases that owners of property in northern Cyprus before 1974 continue to be regarded as the legal owners of that property.
Purchasers could face legal proceedings in the courts of the Republic of Cyprus, as well as attempts to enforce judgments from these courts elsewhere in the EU, including the UK. There has been at least one successful case to enforce rulings in the UK, putting at risk property owned in the UK.
The leaders of both communities are currently in negotiations to try to solve the Cyprus issue. One key issue is property and the handling of pre-1974 Greek Cypriot title-owned property. Property owners and potential purchasers should also consider that a future settlement of the Cyprus issue could have serious consequences for property they purchase, including the possible restitution of the property to its original owner, in addition to compensation payments. In particular, prospective purchasers should consider the implications of any future settlement on land/property in the north of Cyprus that was owned by a Greek Cypriot national prior to 1974 that was subsequently classified as exchange or ‘gift’ land/property by the Turkish Cypriot “authorities”
Purchasers should ensure they are fully aware of the rules in the north of Cyprus in respect of foreigners purchasing property, including the requirement to obtain consent to the transfer of property. Even when purchasing pre-1974 Turkish title land, you may still be refused permission to purchase the land/property and no reason for the refusal may be given.
On 20 October 2006, an amendment to the Republic of Cyprus criminal code relating to property came into effect. Under the amendment, buying, selling, renting, promoting or mortgaging a property without the permission of the owner (the person whose ownership is registered with the Republic of Cyprus Land Registry, including Greek Cypriots displaced from northern Cyprus in 1974) is a criminal offence. The maximum prison sentence is 7 years.
The amendment to the law also states that any attempt to undertake such a transaction is a criminal offence and could result in a prison sentence of up to 5 years. This law is not retrospective, so will not criminalise transactions that took place before 20 October 2006.
Also documents relating to the purchase of property in the north of Cyprus will be presumed by the Cypriot authorities to relate to the illegal transfer of Greek Cypriot property and may be subject to confiscation when crossing the Green Line. Anyone found in possession of these documents may be asked to make a statement to the Cypriot authorities and could face criminal proceedings under the 20 October amendment.
Source : RoC Ministry of Foreign Affairs
Author : RoC High Commission London