Supreme court of Cyprus rejects compensation claim for 2013 bank haircut

The Supreme Court of Cyprus, represented by judges Malachtos, Ioannides, and David, has unanimously rejected a Polish national's appeal for 430,071 euros in compensation regarding the 2013 Laiki Bank haircut. The depositor held 454,579 euros in a fixed-term account before the banking crisis, which was reduced to 24,508 euros following resolution measures. She argued that the haircut constituted an indirect expropriation of her investment, violating Article 4 of the 1992 bilateral investment treaty between Cyprus and Poland. The court upheld the first-instance ruling, determining that EU law takes precedence over bilateral investment treaties between member states. The judges cited European Court of Justice case law, such as the Achmea ruling, to support the decision. Furthermore, it was noted that both nations signed an agreement in 2020 to terminate such bilateral treaties, despite the original agreement being in force during the 2013 crisis. This verdict confirms that individual compensation claims based on expired or superseded bilateral treaties cannot be pursued under these circumstances.