EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 23 April 2010 
on debt arrangements for over-indebted individuals 
(CON/2010/34) 
 
Introduction and legal basis  
On 25 January 2010 the European Central Bank (ECB) received a request from the Greek Ministry of 
Economy, Competitiveness and Shipping for an opini on on a draft law on debt arrangements for over-
indebted individuals (hereinafter the ‘draft law’ ). On 12 February 2010 the Ministry submitted an 
addendum to its consultation request with some cl arifications and additional information on specific 
aspects of the draft law.   
The ECB’s competence to deliver an opinion is based on Article 127(4) and 282(5) 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 provisions1, 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 
According to its explanatory memorandum, the draft law draws on similar legislation in other Member 
States and fills a significant gap in Greece’s current inso lvency legislation. In particular, it introduces 
procedures to enable over-indebted natural persons , who are not merchants for the purposes of the 
existing bankruptcy framework and who have a proven and continuing inability to service their pecuniary 
debts that have fallen due to credit institutions and other creditors, to seek to repay such debts under more 
favourable conditions and to obtain debt relief wher e there are no assets available for the repayment of 
such debts or where their current and expected inco me is not sufficient for that purpose. The draft law 
also contains special provisions, such as the possib ility for debtors to request the exclusion of their 
primary residence from realisation of their assets, and the possibility of a judicial settlement without debt relief where a debtor is temporarily unable to service their debt
2. Finally, the draft law contains a 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2  Articles 9 and 10 of the draft law. 
2 provision on the period of retention and use of da ta in relation to the debt repayment arrangements 
introduced therein3. 
 2. General observations 2.1 The ECB understands that the draft law intr oduces these insolvency arrangements as part of a 
comprehensive legal framework of unlimited dura tion and general application. As the draft law 
applies to debtors and, among other things, governs their relationships with credit institutions, the 
new legal framework should be clear as to the right s and obligations it creates and should take into 
account existing legal relationships between cred it institutions – including in their capacity as 
mortgage lenders – and their debtors, thus ensuring legal certainty. 
2.2 To the extent that the draft law provides for th e medium and longer term repayment of and relief 
from debts owed to credit institutions, such repa yment and relief arrangeme nts should contain the 
necessary safeguards to prevent them having implica tions for financial stability. Such arrangements 
should also cater for possible interaction with th e other similar legisla tive arrangements already 
adopted by the Greek Government to address the current adverse economic conditions. In view of 
the above, the ECB stresses the importance of maki ng a thorough prior assessment of the impact of 
the draft law on the functioning of the financial syst em so as to safeguard financial stability and it 
refers to its recent Opinion CON/2010/8
4, on restructuring of business and professional debts owed 
to credit institutions and on cred it bureau data processing, which is also relevant for the purposes of 
the draft law.  
2.3 Finally, the ECB considers that the proposed fra mework needs to be clear in providing the right 
incentives to debtors falling within its scope to ser vice their debts appropriately and that it should 
contain sufficient safeguards to avoid moral hazard, as this could have serious adverse 
consequences on banks’ capital and liquidity pos itions, as well as on the overall cost of financing. 
 This opinion will be published on the ECB’s website.    Done at Frankfurt am Main, 23 April 2010. 
 
[signed] 
 
The Vice-President of the ECB 
Lucas D. PAPADEMOS 
                                                 
3  Article 16 of the draft law. 
4  All ECB opinions are published on th e ECB’s website at www.ecb.europa.eu.