Greece's bar associations are calling on the government to withdraw proposed legislation that would make it easier for banks and loan-servicing companies to enforce debt-restructuring agreements, warning that the measure could undermine borrowers' legal protections.
The coordinating committee representing the presidents of Greece's bar associations said Thursday that the provision, included in a Finance Ministry bill, disproportionately favors lenders and debt servicers at the expense of financially vulnerable households.
The controversial measure, contained in Article 23 of the draft legislation, would allow private debt-restructuring agreements to serve as directly enforceable legal instruments.
ΔΙΑΒΑΣΤΕ ΕΠΙΣΗΣ
Under the proposed framework, creditors could initiate enforcement proceedings without first obtaining a court-issued payment order, potentially accelerating debt collection and reducing legal costs.
The lawyers argue that the change would bypass important judicial safeguards, including borrowers' ability to challenge payment orders through established legal procedures.
They also warned that the legislation fails to establish adequate mechanisms for verifying outstanding debt balances after previous repayments have been deducted, raising concerns about the accuracy of claims subject to enforcement.
According to the committee, the proposed rules would give banks and loan servicers excessive leverage over borrowers, who typically have weaker negotiating positions when restructuring distressed loans.
The provision could also reduce government revenue by allowing creditors to avoid certain court fees associated with existing enforcement procedures, the lawyers said.
The dispute comes as Greece continues to address the legacy of its financial crisis, during which banks accumulated large portfolios of nonperforming loans that were subsequently transferred to investors and specialized debt-management companies.
The bar associations maintain that the current legal framework adequately balances creditors' rights with borrower protections and provides greater legal certainty.
They described the proposed changes as a serious setback for procedural safeguards and called for their immediate removal from the bill.
The committee also warned that Greece's bar associations would pursue available institutional and legal measures to defend borrowers' rights and ensure equal access to justice.
