Debt Relief Order (DRO)

General

The procedure of the debt relief order refers to insolvent debtors who, provided that they meet the eligibility criteria, upon issue of the Court order, are discharged from non-secured or secured debts after the value of the security is deducted up to the amount of EUR 25 000.
The procedure starts with the submission of a petition by the debtor to the Insolvency Department. After the completion of a successful audit, the Insolvency Department issue an attestation certifying that all eligibility criteria are met for the submission of a petition to the Court.
Following the submission of a petition either by the Department or by the debtor, the Court may issue a debt relief order in relation to the specific debtor and the specific debts mentioned in the submitted petition.
Upon issue of the order, the specific debtor and any specific debt guarantor are discharged from the specific debt, as well as from any other obligations relating to it.
Specific creditors may bring appeals to the Court within one year from the issue date of the order. If the order is annulled, following an appeal by a creditor, the debtor is liable for the specified debt, as well as for any accumulated delays.

Requirements

The main eligibility criteria for the submission of the petition are the following:

The monthly net disposable income of the debtor should not exceed EUR 200 taking into consideration reasonable living expenses for all the members of household.
The value of the debtor’s assets should not exceed EUR 1 000, excluding a vehicle with a value up to 4.000 and machinery used for work purposes valued up to 6.000.
The debtor should be insolvent, i.e. should not be able to pay off their debts as they may arise, and be liable to remain insolvent for a period of one year since the submission of the petition.
The debtor should have their ordinary residence in the Republic of Cyprus for one or more periods cumulating more than 183 days within the current tax year.
The debtor should not be a bankrupt individual who has not recovered nor should they be a recovered bankrupt individual for a period less than 5 years from the date of submission of the petition.

Applications and Forms

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Legislation

Register

The Insolvency Department keeps an electronic debt relief order register which it also publishes on its website. The details of the debt relief orders are deleted from the register one year after their issue.