May 2023

Decision of the Penal Court of First Instance on the Suspension of Criminal Prosecution for the Offence of Non-Payment of Employer's Social Contributions

With its decision issued at the meeting of 9.05.2023, the F' Athens Court of First Instance accepted our claim and ordered the termination of the criminal prosecution brought against our client, who was accused of the act of non-payment of employer's insurance social contributions, under the law 86/1967, given that the relevant arrears of his debts are currently being settled under the Out-of-Court Workout (OCW) Mechanism of Law 4738/2020.  

It should be noted that according to article 8 of the recent Law 4997/2022 "In all cases of debt adjustment to social security institutions, regardless of the specific legal framework governing them, the following consequences occur, as regards the criminal treatment of the debtor with the inclusion in the adjustment and if the conditions are met. 86/1967 (A' 136), and the relevant case file shall be placed on file by an act of the competent Public Prosecutor [...]'. This provision was introduced despite the already existing Article 23 of Law 4738/2020, which provides for the suspension of criminal proceedings in the event of the existence of an agreement on the settlement of the debt in question which has been drawn up and is in force, on the grounds that this avoids the repeated visits to the court by the debtor, who is in compliance with the settlement, and by the employees of the e-EFKA to confirm that the settlement is being complied with. This arrangement will also reduce the number of plates and the corresponding burden on the courts, while respecting the dignity of citizens.

Moreover, as the majority rapporteur, Mr. Aktipis, Member of Parliament, had also mentioned during the adoption of the law in Parliament: "At the same time, the bill provides for the conditional suspension of the criminal prosecution of debtors of regulated insurance debts for as long as the regulation is served, whereas until now we have had a suspension. This avoids the repeated visits to the court by the debtor who is in compliance with the arrangement and by the e-FSA officials to confirm that the arrangement is being complied with. This arrangement will also reduce the number of plates and the corresponding burden on the courts, while respecting the dignity of citizens".

In the present case, therefore, the aforesaid judgment, while accepting the above independent plea for discontinuing the prosecution, taking into account, on the one hand, that the prosecution in question had been brought under the a.n. 86/1967 and related to the non-payment of our client's contributions - debts to a social security institution, on the other hand, according to the facts specifically assessed by us, that an application for an Extrajudicial Debt Settlement Mechanism for natural persons had been submitted definitively on behalf of our client under Law No. 4738/2020, and that, following its finalisation, a bilateral debt restructuring agreement was drawn up between our client and the Centre for the Collection of Insurance Contributions (KEAO), the contents of which our client - the defendant complied with and was aware of, and ordered the termination of the criminal proceedings.