Heraklion Court of First Instance, through its no.4/2019 judgement, ratified the resolution agreement between the country’s most historical Cooperative Organisation and its creditors. The achieved debt restructuring – which from the very beginning had been handled by our law firm- reaches the amount of 36 million euros with a significant impairment concerning the banks, the State and the private creditors.

Heraklion Court of First Instance, through its no.4/2019 judgement, ratified the resolution agreement between the country’s most historical Cooperative Organisation and its creditors. The achieved debt restructuring – which from the very beginning had been handled by our law firm- reaches the amount of 36 million euros with a significant impairment concerning the banks, the State and the private creditors.
This judgement is also particularly important from a legal aspect, because:
a) It’ s the first one historically to reduce a basic debt owed to the State (specifically, to the Custom) per 50% and not only the 100% of the interests, fines and increments.
b) It clarifies that the courts’ role should be restricted by the orders of modern European legislation and it can’t alter the content of an agreement by unilaterally modifying its terms. It can only set a time limit for clarification or correction of issues like an incorrect indication of claims at the creditors’ list. The court can’t modify substantially the agreement to which the contracting parties intended, even if the rest of the affected creditors ask for it.
c) It repeats the most recently consolidated in jurisprudence legal opinion according to which withholding taxes are regulated under a resolution agreement even if they don’t constitute a third party’s tax claim, since according to the Greek Civil Procedure Code and the Bankruptcy Code, the State is classified with privileges and receives the specific amounts from the debtor’s property (not from the third party’ s property, which was initially the debtor).