EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 13 January 2010  
on restructuring of business and professional debts owed to credit institutions and on credit bureau 
data processing 
(CON/2010/8) 
 
Introduction and legal basis  
On 23 December 2009 the European Central Bank (ECB) received a request from the Greek Ministry of 
Economy, Competitiveness and Shipping for an opinion on a draft law on the restructuring of business and professional debts owed to credit institutions, pr ovisions governing credit bureau data processing and 
other provisions (hereinafter the ‘draft law’). On 29 December 2009 the Ministry submitted an addendum 
to its consultation request with some clarifications  and additional information on specific aspects of the 
draft law.   
The ECB’s competence to deliver an  opinion is based on Article 127(4) of the Treaty on the functioning 
of the European Union and the sixth indent of Article 2(1) of Council Decision 98/415/EC of 
29 June 1998 on the consultation of the European Ce ntral Bank by national authorities regarding draft 
legislative provisions
1, as the draft law relates to rules applicable  to financial institutions insofar as they 
materially influence the stability of financial ins titutions and markets. In accordance with the first 
sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council 
has adopted this opinion. 
 1.  Purpose of the draft law 
1.1 According to its explanatory memorandum, the dr aft law serves as the starting point for the Greek 
Government’s implementation of a broader stra tegic plan for strengthening the market and 
developing the economy. The draft law seeks to introduce measures intended to enhance liquidity 
in the market by supporting, in particular, business, professional and agricultural activities. The 
draft law is aimed at enabling natural and legal persons in economic distress, pursuing the above-
mentioned activities, to restructure their overdue  debts, thus providing liquidity support and 
ensuring the viability of their activities under the current adverse economic circumstances. 
Moreover, on the basis of specific criteria, the draft law also provides for repayment arrangements 
in relation to debts that have not become overdue  (performing debts). Furthermore, the draft law 
amends the existing legal framework on the record ing and processing of credit bureau data in an 
effort to strike a balance between the availability of information on debtors, which is necessary for 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2 the efficient assessment of credit risk, and the unwarranted exclusion of debtors from access to 
credit necessary fo r the pursuit of economic activities. 
1.2 More specifically, under Article 1(1) of the draf t law, natural and legal pe rsons that have entered 
into loan or credit agreements with banks or ot her credit institutions for business, professional or 
agricultural purposes may apply to have their debts re structured if such debts have become overdue 
between 1 January 2008 and the date of publication of the draft law2. Article 1(4) of the draft law 
also provides for the restructuring of debts that  have become overdue after 1 January 2005 under 
certain conditions3. In accordance with Article 1(5) of the draft law, applications for debt 
restructuring, as described above, must be subm itted by 15 March 2010, with credit institutions 
being obliged to communicate to debtors the amount of the debt within 30 days following the date of submission of an application.  
1.3 Moreover, Article 2(1) of the draft law enables na tural and legal persons that  have entered into loan 
or credit agreements with banks or other credit in stitutions for business, professional or agricultural 
purposes to apply for any of the following measures in relation to performing debts, provided that 
they have no outstanding tax or national insuran ce liabilities and the conditions set out in Article 2 
of the draft law have been met
4: (i) a one-year grace period with a respective extension of the 
contractual term of the loan and capitalisation of interest on expiry of the grace period; (ii) a two-
year suspension of repayments of outstanding capita l with a respective extension of the contractual 
term of the loan and payment of interest over th e suspension period in acco rdance with the interest 
periodicity provided for in the agreement; or (iii) a three-year extension of the contractual term of the loan. In accordance with Article 2(4) of the draf t law, applications for debt repayment must be 
submitted, also in these cases, by 15 March 2010.  
1.4 Article 3(1) of the draft law provides for the de letion of adverse data on repaid debts from records 
kept by or managed for the benefit of credit or fi nancial institutions, provided that the relevant debt 
has already been or will be fully repaid within thr ee months of publication of the draft law. In the 
same vein draft Article 3(2) lifts any restric tion on issuing new cheque books imposed pursuant to 
                                                 
2  Where the agreement has not been terminated, the restructuring requires that a debt be overdue for at least three months.  
Default interest and compound interest, less that already paid up to the date of entry into fo rce of the draft law, will be 
deducted from the total outstanding amount su bject to restructuring and will be wr itten off. The total debt subject to 
restructuring may not exceed one million euro per credit ins titution and three million euro for all credit institutions. 
3  Such an option is possible, provided that by 15 April 2010 th e debtor pays off a sum equal to 10 % of the resulting debt, 
excluding default interest and compound intere st, for which separate accounts will be  kept. If the debtor pays off half the 
debt in accordance with the ar rangement, default interest and compound interest  (less that already paid up to the date on 
which the draft law enters into force) will be written off. 4  Under Article 2(2), the following persons  may apply for the measures referred to  in Article 2(1) where the outstanding 
 capital does not exceed EUR 250 000 per credit institution and EUR 1 million for all credit institutions: (i) natural and 
legal persons who keep category III books in  accordance with the Code of Books and Records, have an annual turnover of 
less than EUR 2,5 million during the last financial year up to  and including June 2009 and have incurred a loss during that 
financial year; and (ii) agricultural cooperatives, asso ciations of agricultural c ooperatives and producers groups, 
regardless of the category of books they keep, provided th at the conditions set out in (i) above are met. Under 
Article 2(3), the following persons may also apply for the m easures referred to in Article 2(1) where the outstanding 
capital does not exceed EUR 100 000 per credit institution and EUR 300 000 for all credit institutions: (i) natural and 
legal persons engaged in a commercial activity with a gross annual revenue of less than EUR 150 000 during the 2008 
financial year; (ii)  natural persons engaged in an agricult ural activity as their main occupation; and (iii) undertakings 
which have incurred substantia l damages from fire or natura l disasters between 2007 and th e date of publication of the 
draft law.  
3 Decision No 234/23/11.12.2006 of the Banking and Credit Committee of the Bank of Greece5 in 
relation to cheques that have been or will be paid  within three months of publication of the draft 
law. With regard to credit bureau data processing,  Article 4 of the draft law introduces changes to 
the current legal framework, in particular by re ducing by one year the current maximum periods 
during which such data may be kept and used by  credit or financial institutions or credit bureau 
data archives in relation to debts that have been fully repaid6. In particular, cheques paid within 
30 days of being returned to a drawer will not be  recorded in the above mentioned archives, while 
those recorded will be deleted7. In relation to debts that have no t been repaid, Article 4(4) of the 
draft law provides for the deletion of the relevant data  ten years after such data have been recorded.  
1.5 Article 5 of the draft law introduces the obligatio n for credit and financial institutions that have 
passed adverse debt data to lawfully operating cr edit bureau data archives to inform the person in 
charge of processing such data within two worki ng days of obtaining proof of debt payment. In 
addition, Article 6 of the draft law states that, under certain conditions, debtors may obtain provisional judicial protection by preventing regist ration of  credit bureau data in archives provided 
that it is deemed probable that an overdue debt does not exist.  
1.6 Article 7 of the draft law enables credit institu tions to issue new cheque books while a restriction 
on issuing such books still applies, provided that a third party guarantor, name ly a natural or legal 
person not subject to such restriction, guarantees up to EUR 5 000 for each cheque. Article 8 of the 
draft law provides for sanctions to be imposed by the Minister for the Economy, Competitiveness 
and Shipping in cases of infringement of the obligati ons under the draft law. Finally, Article 9 of 
the draft law addresses tax issues where the draft la w entails writing-off claims of credit institutions 
in accordance with its provisions. 
 2. Procedural and general observations 2.1 Before introducing its specific comments on the dr aft law, the ECB wishes to draw the consulting 
authority’s attention to one procedur al and several general observations. 
2.2 Procedurally, in cases of particular urgency th at do not allow for a normal consultation period, the 
consulting authority may indicate urgency in the consultation request and ask for a shorter time 
limit for the ECB’s opinion to be adopted. This  does not prejudice the national authorities’ duty 
under Articles 127(4) and 282(5) of the Treaty to consult the ECB on national draft legislative 
provisions falling within its fields of competence  in due course of the national legislative process. 
The second sentence of Article 4 of Decision 98/415/EC states that the ECB must be consulted ‘at an appropriate stage’ in the legislative process. Th is implies that the consultation should take place 
                                                 
5  FEK 63B/2007. 
6  Under Article 4(1), such periods are reduced to two, thr ee and four years depending on the three categories of payment 
facilities provided for therein. 
7  In this respect, Article 4(5) provides that from the point in time when such cheques no longer appear in the relevant 
information records in accordance with the provisions of Article  4 of the draft law, the restriction on issuing new cheque 
books imposed pursuant to Decision No 234/23/11.12.2006 is lifted. 
4 at a point in the legislative process that afford s the ECB sufficient time to examine the draft 
legislative provisions and to adopt its opinion in  the required language ve rsions and which also 
enables the relevant national authorities to take the ECB’s opinion into consideration before the 
provisions are adopted. In this respect, it is worth recalling that, as noted by the Court of Justice, the obligation to consult the ECB under the Treat y is intended ‘essentially to ensure that the 
legislature adopts the act only when the body has been heard which, by virtue of the specific 
functions that it exercises in the Union framework in the area concerned and by virtue of the high 
degree of expertise that it enjoys, is particularly we ll placed to play a useful role in the legislative 
process envisaged’
8. Given that the consulting authority has indicated to the ECB that the draft law 
is scheduled to be voted into law within a ve ry short time frame, the ECB considers that the 
minimum consultation period of one month provide d for in Article 3(1) of Decision 98/415/EC 
applies. According to Article 3(4) of Decision 98/415/EC, Member States are obliged to suspend 
the process for the adoption of draft legislative provision pending submission of the ECB’s opinion. This means that the adopting authority must  have a real opportunity to consider the ECB’s 
opinion in a meaningful manner prior to  taking its decision on the substance. 
2.3 The consulting authority views the draft law as containing one-off temporary measures of limited 
material scope, which should support liquidity fo r business, professional and agricultural activity. 
However, the ECB notes that the proposed measu res could have a negative impact on market 
liquidity, especially against the backdrop of the cu rrent adverse economic conditions in Greece. In 
particular, a deterioration of these conditions could have systemic implications within Greece and, 
possibly, also cross-border effects
9. Moreover, in key respects, some of the measures envisaged in 
the draft law are not consistent with the princi ple of an open market economy, as reflected in 
Article 3 of the Treaty on the European Union, and could therefore possibly hinder, rather than 
support, the flow of credit even under normal ma rket conditions. In view of the above, the ECB 
stresses the importance of thoroughly assessing be forehand the impact of the draft law on the 
capital adequacy and liquidity position of credit institutions, as well as its effects on the functioning of the financial system, so as to safeguard fi nancial stability, promote market efficiency and 
liquidity and support the adequate flow of credit to the economy.   
2.4 Moreover, the draft law applies to debtors and governs their relationships vis-à-vis credit 
institutions. Clearer formulations of the rights and obligations introduced by the draft law, as well 
as a careful consideration of its impact on exis ting legal relationships between creditors and 
debtors, are necessary in order to ensure lega l certainty, avoid undue interference with the 
ownership positions of credit in stitutions and prevent moral hazard, namely the creation of 
incentives not to service debt in a timely manner.  The potential moral hazard generated through the 
                                                 
8  Case C-11/00 Commission of the European Communities v European Central Bank  [2003] ECR I-7147, paragraphs 110 
and 111. 
9  Even if the draft law only covered the Greek branches of cr edit institutions domiciled in other EU Member States, its 
effects could extend beyond Greece, requiring credit institutions domiciled in other EU Member States to make 
provisions for the suspension of debt re payment envisaged in the draft law. Th is could have an impact on financial 
stability in other EU Member States. 
5 proposed restructuring of currently performing lo ans could have serious adverse consequences on 
banks’ capital and liquidity positions, as we ll as on the overall cost of financing. 
2.5 Further to its general observa tions in paragraphs 2.3 and 2.4 above, the ECB has the following 
specific comments to make on the draft law.  
 3. Specific observations 3.1 The ECB understands that Articles 1 and 2 of the draft law entitle debtors falling within its scope of 
application to benefit from restructuring arrangeme nts in relation to over due debts and performing 
debts, respectively, provided that the conditions set out therein are met. However, the ECB is of the 
view that the draft law should explicitly stipulate that debtors entitled to apply for the restructuring of their debts should prove their ability to repay su ch debts in accordance with the terms set out in 
the draft law. Indeed, restructuring a debt wit hout the debtor’s proven ab ility to repay would only 
postpone the occurrence of default, thus increasing th e level of credit risk in the financial system 
and impinging on the ability of credit institutions to fund the recovery of the economy as a whole. 
Moreover, from a legal certainty perspective, th e ECB finds that the corresponding obligations on 
the part of the credit institutions in relation to th e rights of debtors to apply for debt restructuring 
under Articles 1 and 2 of the draft law are not sufficiently clear and should be reformulated in the draft law in order to enhance clarity and reduce credit risk. 
3.2 Under Article 1(4) of the draft law, debtors that  have entered into loan or credit agreements in 
accordance with Article 1(1) ther eof may, under certain conditions
10, apply for the restructuring of 
debts that have become overdue after 1 January 2005 . Without prejudice to its comments in 
paragraph 2.4, above, the ECB suggests including, in  Article 1(4) of the draft law, the date of 
31 December 2007 as the end-date for debts falling due  after 1 January 2005, as this would clarify 
the scope of the draft law by differentiating be tween the two categories of debt subject to 
restructuring, i.e. (i) debts that have become overdue between 1 January 2005 and 31 December 2007, and (ii) debts that have beco me overdue between 1 Ja nuary 2008 and the date 
of publication of the draft law. Furthermore, th e inclusion of such end-date would discourage 
perverse incentives that could result if debtors coul d avail themselves of the possibility to apply for 
the restructuring of debt becoming overdue following the draft law’s publication and up to 
15 March 2010, which is the deadline for applying for debt restructuring for both categories of debt.  
3.3. Article 2 of the draft law enables natural and le gal persons that have ente red into loan or credit 
agreements with banks or other credit institu tions for business, professional or agricultural 
purposes to apply for debt restructuring in relati on to performing debts under certain conditions and 
for the amounts set out therein. In this resp ect, the ECB would like to draw the consulting 
authority’s attention to the potential legal uncertain ty risk that the inclusion of securitized debts 
                                                 
10  See footnote 3. 
6 into the scope of such debt restructuring coul d create, encumbering credit institutions’ access to 
securitisation markets to obtain liquidity and, conseq uently, the extension of credit to the economy.  
3.4 The ECB understands Article 3 of the draft law as being aimed at providing entrepreneurs that face 
difficulties in repaying their debts, but who will settle their debts within three months of publication of the draft law, the opportunity to c ontinue their activity without being penalized on 
the basis of adverse data records on their econom ic behavior. However, the prospect of such 
information no longer being available to credit ins titutions would not be in line with best practice, 
and could affect negatively the efficient evaluation of debtors’ credit risk, by encumbering the ability of credit institutions to differentiate am ong debtors representing varying levels of risk. Τhe 
proposed deletion of credit history data could, in  short, make credit institutions more cautious in 
their lending and increase the cost of financing the economy, in particular of the firms and 
households that service their debt. The same observa tions also apply to draft Article 4(1) on credit 
bureau data processing, which, inter alia , reduces by one year the current maximum periods during 
which data on debts that have been fully repaid  may be kept and used by credit or financial 
institutions or credit bureau data archives. The ECB would welcome an assessme nt of the effects of 
the proposed restrictions provided for in Article 3 a nd Article 4(1) of the draft law, also taking into 
account the practice in other Union Member States. 
3.5 Finally, under Article 7 of the draft law, read  in conjunction with Article 3(2) thereof, credit 
institutions may issue new cheque books wh ile a restriction pursuant to Decision 
No 234/23/11.12.2006 of the Banking and Credit Committee of the Bank of Greece on issuing such cheque books still applies, provided that a thir d party guarantor guarantees up to EUR 5 000 per 
cheque. The ECB is concerned that the guarant ee of EUR 5 000 per cheque may not suffice, as 
cheques could be issued for amounts well above that level. Therefore, it is advisable that a debtor 
subject to the above-mentioned restriction is provid ed with a cheque book only if the full amount of 
the cheque is guaranteed. Furthermore, the creditw orthiness of the guarantor as well as the relevant 
concentration risk should be assessed when providing a cheque book subject to a guarantee. 
Finally, the ECB notes that, by lifting restrictions  imposed pursuant to the aforementioned Decision 
adopted by the Bank of Greece in accordance w ith the regulatory powers conferred upon it by its 
statute, the proposed arrangement could interfere with the Bank of Greece’s powers and with its ability to adequately perform its relevant tasks. 
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 13 January 2010. 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET