Government Relief Measures upon COVID-19 spread

The outbreak of the Covid-19 and the rapid spread globally presents an alarming health crisis that has a major impact on businesses with many implications.  The Government of Cyprus is constantly applying new measures in an effort to minimize the impact of this pandemic.  On the 30th of March 2020 the Ministry of Finance welcomed the decision of the Parliament in relation to the Law on emergency measures by financial institutions and supervisory authorities.[1]  The new measures aim to protect borrowers and are consistent with the decision of the Board of Directors of the Central Bank of Cyprus dated 25th March 2020.  Rendering the Decree issued on the 30th March the following are announced:

a)      The obligation to pay installments, including interest on credit facilities granted and/or purchased and/or managed by financial institutions, is suspended for all beneficiaries.

b)      The beneficiaries are natural persons, legal entities governed by public law, self-employed persons and undertakings who have had no delays in paying the installment more than 30 days from the date provided for by existing contractual obligations on the 29th of February 2020.

c)      The aforementioned measures are valid from March 30th, 2020 (date of issuance of the Decree) until December 31st, 2020.

d)      Suspension of installments and interest shall apply from the date of issue of the Decree, provided that the beneficiaries send in writing or by mail or by e-mail of fax to the financial institutions the expression of interest as set out in the Annex to the Decree concerned.

e)      All installments of capital and interest for which the payment period is suspended at the date of expiry of the Decree will not become immediately chargeable.

f)       On the expiry of the Decree, the payment of installments and interest shall resume, and the period of payment shall be deemed to have been automatically extended for any period required.

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Additional Relief Measures

The Ministry of Labor, Welfare and Social Insurance in response to the outbreak of Covid-19 have established further relief measures to combat the impact the epidemic may have on local businesses. 

The Special Scheme for Self-employed Workers Decree (No.3) dated 29th of March 2020[2] is applicable from the 16/03/2020 until 12/04/2020.  It was announced that self-employed workers who have fully suspended their operations according to the Decrees of the Minster of Health and the relevant decisions of the Ministerial Council given that nature and/or the way they operate has not been altered; including self-employed workers who have partially suspended their operations may apply for the Scheme by submitting the relevant application (EEA.5).  In other words, this applies if they have a decrease in their turnover of more than 25% during the month of March 2020 and it is predicted that an equivalent decrease in turnover will occur for the month of April 2020 as well, in comparison to the corresponding months of the previous year and the decrease in their turnover is exclusively a result of the state their operation entered due to the COVID-19 coronavirus pandemic.  In the event that the business was not in operation, then the comparison will be made with the months preceding March 2020.

Self-employed workers who are practicing any of the following professions cannot participate in the scheme as their financial activity has not been particularly affected. These are:

-          Pharmacologists, microbiologists et al;

-          Doctors (Dentists are not included);

-          Veterinarians;

-          Pharmacists;

-          Operators of medical appliances and equipment;

-          Insurance agents, salespeople;

-          Kiosk owners, grocers, mini markets;

-          Manufacturers of dairy products;

-          State institute teachers (their salaries will be paid by the Ministry of Education, Culture, Sport and Youth).

Solving the Conundrum Presented by Non-GAAP Financial Measures ...

In order to be eligible for the Plan, it is essential that no employees have been dismissed since March 1st, 2020 and in case the application is approved, no employees are terminated both during the period the business will participate in the Plan and during an additional period which will equal the period of participation in the Plan plus an extra month (except for reasons justifying dismissal without notice). 

Briefly the Special Allowance for Self-employed Workers (weekly) will equal 60% of the amount of the weekly total of insurable earnings, based on which the beneficiary had the obligation of paying contributions to the Social Insurance Fund for the fourth trimester of 2019.  The Special Allowance cannot amount to less than €300 if it applies to a period of four weeks and holds a maximum limit of €900 if it applies to a period of four weeks.  Self-employed workers who employ other persons may also submit on behalf of their employees an application for the Plan for Full or Partial Suspension of Operations.  The Special Allowance for Self-employed Workers is not granted for the period during which the applicant is receiving unemployment allowance, special sickness benefit, special unemployment benefit, sickness benefit, allowance of the Special Leave for the Care of Children or other similar provisions by the Social Insurance Fund.

Lastly, for the period during which the Special Allowance for Self-employed Workers will be paid, the self-employed worker is exempt from their obligation to pay contributions to the Social Insurance Services.  The period of contribution of the Special Allowance for Self-employed Workers will be considered as a period of assimilated insurance for the purposes of contributions to the Social Insurance Fund and the insurance account of the Beneficiary will be credited accordingly. 

[1] Ministry of Finance, Press Office, (30/03/20) < > last accessed 02/04/20

[2]  Υπουργείο Εργασίας, Πρόνοιας και Κοινωνικών Ασφαλίσεων (ΥΕΠΚΑ), Μέτρα στήριξης για αντιμετώπιση των επιπτώσεων του κορωνοϊού, <$file/5231%2029%203%202020%20PARARTIMA%203o%20MEROS%20I.pdf> last accessed 02/04/2020