The changes, which need a qualified majority of 84 votes and consensus by the opposition, target reforming the treatment of inheritance cases in courts by shifting the process to notaries public, and facilitate execution of collateral to help banks stop the rising bad loans
TIRANA, Feb. 6 – The Albanian government says it has drafted a new fiscal package which under the proposed changes to the Civil Code and Civil Procedures Code will increase the efficiency of the justice system and ease procedures for citizens. The changes, which need a qualified majority of 84 votes and as a result consensus by the opposition, target reforming the treatment of inheritance cases in courts by shifting the process to notaries public, and facilitate execution of collateral to help banks stop the rising bad loans.
“We are introducing a package of laws which favour citizens and the banking system, a system vital in the times we are living, under conditions when immunities and sustainable growth are required against the economic crisis and there is no time to lose because of prolonged procedures in the court system,” said Justice Minister Eduard Halimi.
The Justice Ministry says citizens need at least one month’s time and 200 to 300 euros to get a court decision on the issue of an inheritance certificate. The shift of this procedure to the notaries public will change the situation and citizens can get the inheritance certificates in only few minutes. “This reform is necessary for the court system because of facilitating the judges’ work and increasing their professional performance,” said minister Halimi.
The fiscal package also comes as a request by the Albanian Association of Banks to curb the rising trend of bad loans, currently at 22 percent, by increasing the efficiency of collateral execution. The process of collateral execution is reformed by lowering the price floor from 65 percent of the collateral to 50 percent, based on EU examples.
The reform also foresees the acceleration of execution orders which will automatically be issued after the court decision without the need for a written request.
The Albanian Association of Banks had earlier warned legal steps that would require changes to the Civil Procedure Code are needed to accelerate the execution of collateral, one of the key barriers which has led to bad loans jumping to a record 22 percent and accounting for around 1 billion euros. Seyhan Pencabligil, the Chairman of the Albanian Association of Banks and CEO of BKT, the country’s second biggest commercial bank, says two steps are necessary for an efficient execution of collateral.
The first measure involves the reduction of the collateral price up to 50 percent of the original price in the second auction or the introduction of a third auction under which the price of the collateral will be set based on market prices. The liberalization of the bailiff offices and the tariffs being determined by the market is another measure banks suggest. Both measures would require changes to the Civil Procedure Code which need a qualified majority of 3/5 of votes in Parliament.
Ongoing political conflicts between the majority and the opposition this time over the deadlock in the Fier regional council, continue preventing the establishment of the Administrative Courts. Five months after the approval of the law in Parliament both the ruling Democrats and the opposition Socialists have failed to make some changes to the Supreme Court law needing a qualified majority of votes in order to complete the full legal infrastructure on the establishment of these courts ensuring the independent legal review of administrative decisions. Although supporting the changes to the Supreme Court law, the opposition Socialist Party has warned it will not give its consensus if the dispute in the regional council of Fier, a stronghold of the opposition, if not resolved. Both the majority and the opposition claim they have the head of the Fier regional council and the process is being legally examined in prolonged trials. The case is also holding back key reforms required by the European Commission after Albania was granted conditional candidate status as both parties refuse making concessions.
“Albania would need in particular to focus on consensually adopting the revised rules of procedure for parliament and the amendments to the Laws on the High Court and on Civil Service,” says the European Commission in its latest progress report on Albania.
