Cyprus Mail: News Articles in English, 02-09-04

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From: The Cyprus Mail at <http://www.cyprus-mail.com/>

Wednesday, September 4, 2002

CONTENTS

[01] CyTA to announce cheaper call charges

[02] Insurance cartel slammed with heavy fine

[03] Dog slaughter is third such attack targeting police officers

[04] Airport bidders gather in Nicosia

[05] Police accused of terrifying residents in 'wrong house' search

[06] Omirou outlines European vision

[07] Hi tech strawberry project beats the red tape at last

[01] CyTA to announce cheaper call charges

PHONE CALLS will soon be cheaper because of the recent 'super-profits' made by the Cyprus Telecommunications Authority (CyTA).

Both Communications & Works Minister Averoff Neophytou and CyTA said yesterday there will be a reduction in charges across the board following the revelation of 'super profits' by the semi-government organisation and last week's imposition of a £20 million penalty by the Competition Commission.

CyTA will also make a £30 million contribution to a number of areas in the public interest including education, the environment, health, sports, and technology and research.

The reduction in charges will be announced at the end of the month and will apply to fixed and mobile phones, international calls and Internet use.

Yesterday's announcement mirrors the recommendations made last week by Auditor-general Chrystalla Yiorkadji, who said the level of CyTA profits had been known about more than a year ago, and that the organisation had been earning high revenues for the past ten years.

As to how a semi-government organisation had made such staggering profits when the law states that charges should be set at a level to cover costs and plans for expansion, Neophytou said yesterday it was the "result of an old model semi-government organisation operating in a monopoly". He repeated his belief in the need to break the state monopoly and semi- government status in favour of the formation of a wholly state-owned company.

Neophytou again rejected calls by Deputies that the money should be refunded to consumers.

"That would be against the public interest," he said. "Sixty-one per cent of householders pay less than £10 per month... if refunds were made it would result in more than £300 million being returned to the business community."

Copyright Cyprus Mail 2002

[02] Insurance cartel slammed with heavy fine

AN INSURANCE cartel controlling 85 per cent of the health insurance market faces a fine of nearly £1 million and the annulment of its contracts with clinics after the Competition Commission found it had breached two laws and abused its dominant position.

Christodoulos Tselepos, Head of the Competition Commission said yesterday, " In November 2001, we received complaints from two clinics that 12 insurance companies had formed a cartel that had managed to amass 85 per cent of the health insurance market and was forcing its customers to seek healthcare only from clinics that had signed an agreement with the cartel."

After investigation of the complaint, the Commission found that the cartel was in breach of article 4.1 and article 6. "The Commission believes that the cartel, through its contracts with the clinics, was managing competition and abusing its dominant position," said Tselepos.

Lawyers representing the insurance companies have been given until September 9 to prepare mitigation before a final hearing, where the Commission will decide the extent of the fine and whether to impose any other sanctions.

"The Commission has the power to fine the cartel up to 10 per cent of its share of the total market," Tselepos told the Cyprus Mail.

The health insurance market is valued at £11 million, which could mean a fine of £935,000, given the cartel's share.

According to the commission's findings, the cartel had set about securing a number of clinics to contracts after fixing prices with them for treatments and services. When policyholders wished to make a claim for medical treatment, they received letters from their insurers, advising them to attend the clinics that were under their contracts in order to 'avoid complications' and warning them that they may face 'difficulties with payment of treatment' or 'problems with their cover' if they went elsewhere.

"Clearly the insurance companies were abusing their dominant position," said Tselepos, "Those clinics who were not contracted to the insurance companies were put in an unfair position."

Tselepos explained how consumers were facing a poorer service as a result of the contracts. While the insurance companies were forcing down the price of the services provided by the clinics it was raising the cost of its health insurance premiums.

"In the end, the only people who will benefit under these circumstances are the cartel, whose profit margin increase. Clinics will be forced to cut back its costs in order to remain competitive while patients end up receiving inferior healthcare," said Tselepos.

The cartel, which was formed 12 months ago and is made up of 12 of the 14 insurance companies offering health insurance, will also be forced to annul its existing contracts with the clinics. Should the companies fail to follow the orders of the Commission by a given date, they face individual daily fines of up to £5,000.

Asked what would happen if a similar scenario were to reoccur, Tselepos said, "They would face even stronger fines and harsher measures."

"Our role is to ensure healthy competition exists, only under a true system of competition is the consumer is best served because it forces an improvement in service at the best prices."

Only last week, the Commission hit the headlines when it imposed a massive £20 million fine on the Cyprus Telecommunications Authority (CyTA) for abusing its monopoly to rake in huge profits.

Copyright Cyprus Mail 2002

[03] Dog slaughter is third such attack targeting police officers

POLICE in Limassol are continuing investigations into the killing of seven hunting dogs belonging to a police officer near the area of Ayios Amvrosios.

The incident is the third such butchery of animals owned by Limassol police in as many months.

The hunting dogs, reportedly worth some £7,000, were killed between Sunday night and Monday morning. Police said it appeared that six of the dogs had been poisoned and the seventh had been shot, after they visited the scene with officials from the Limassol Veterinary Services.

Three months earlier, a number of chickens and rabbits belonging to Tassos Economides of the Crime Prevention Unit (CPU) in Limassol were also slaughtered. Last month, 22 baby goats owned by Kyriacos Ioannou of the CPU were poisoned, also in suspicious circumstances.

Economides said yesterday that the CPU was susceptible to such acts of violence because they were constantly close to or in the way of criminals in an effort to prevent them committing a crime.

The police have their suspicions as to who the perpetrators are but are unable to press charges without the necessary evidence. "This type of crime is restricted to a small group of criminals that concentrate on farm burglaries and thefts. They use the same modus operandi for all their attacks. Civilians and farmers have had animals burnt, hanged or beheaded," he said. "But without the evidence, we cannot do anything."

A police source told the Cyprus Mail that the last incident was unlikely to be work-related, but probably involved a personal issue.

Copyright Cyprus Mail 2002

[04] Airport bidders gather in Nicosia

A TWO-DAY conference for the five bidders competing in the competition to build the island's two new airports opened in Nicosia yesterday.

Addressing the opening of the conference, Communications and Works Minister Averoff Neophytou said his ministry would make every effort to ensure a transparent and fair tendering procedure for the concession contract for the development and operation of the Larnaca and Paphos International Airports.

The state is seeking a strategic partner to invest £200 million into the Larnaca and Paphos airport BOT (Build-Operate-Transfer) projects that will see the winning bidder running the facilities for the next 20 years. The five short-listed candidates were chosen in June.

Neophytou said yesterday that, during the conference, members of the five consortiums would have the opportunity to be informed on the use and operation of Cypriot airports.

"A transparent and fair tendering procedure will ensure that the Concession Contract will be awarded to the best-evaluated bidder," Neophytou said.

The five joint ventures are Alterra Consortium, Cyprus Gateway Airports, Hermes Airports, Project Pegasus and a consortium headed by J & P (Joannou and Paraskeviades), J&P originally came in sixth place but challenged the government in court.

The suit led the government to ask all 10 initial candidates to fill out an additional questionnaire, which one of the original five - Fraport AG - declined to do, leaving the way open for J&P.

During the conference, some of which is taking place behind closed doors, various interested parties such as the Cyprus Tourism Organisation, the Department of Civil Aviation, the Association of Cyprus Travel Agents, the Public Works Department, Airlines Operations Committee and the Board of Airlines Representatives will give their views. Confidential meetings will also be held with all five consortia.

The five bidders will be given around four months to submit their tenders, but choosing a winner could take anything from weeks to months, depending on the bids and the amount of negotiations needed.

It is hoped construction will begin in 2003 after the winner is announced before the end of this year.

The new Paphos Airport is expected to begin operating in 2004 and the new Larnaca Airport in early 2005.

The five finalists are:

1. Alterra Consortium, which took part in the development of Singapore and Manchester airports and includes Cypriot companies Lanitis E.C. Estates, Amathus Navigation Co Ltd, Cybarco and Caramondani Bros. The Royal Bank of Scotland is also involved.

2. The Cyprus Gateway Airports consortium, which was involved in the Vienna Airport project and includes Cypriot partners George P. Zachariades construction.

3. Hermes Airports, which comprises investors from three international airport projects, including Irish group Aer Rianta. Cypriot participants include Charilaos Apostolides, CTC, Egis Projects and Iacovou Brothers.

4. Project Pegasus is a Spanish airport consortium, which does not include any Cypriot partners.

5. The J&P consortium, which includes the British Airport Authority (BAA).

Copyright Cyprus Mail 2002

[05] Police accused of terrifying residents in 'wrong house' search

Speaking at a news conference, Thoma said he had sent a letter to the Attorney-general briefing him of the August 25 night raid, in which police allegedly failed to present a warrant before entering and searching the home of Christodoulos Constantinou in the Omonia area of Limassol.

Thoma said around 20 police officers had surrounded the residence just before 11pm, knocking on doors and windows and waking up the whole neighbourhood.

When the occupants opened the door, the police entered the house without showing a warrant or asking permission from the owner's wife.

They searched the house until 12.45am; throughout the operation they refused to explain what they were looking for, Thoma said.

The officers then left, leaving behind the bewildered woman and her mentally handicapped son.

When her husband returned from work, he found his wife crying.

The deputy said he had asked for explanation from the duty officer, who told him officers were acting on an anonymous tip-off that there had been a murder on Liopetri Street, number five.

The house the police searched was Liopetri Street, number seven, Thoma said.

Thoma said the police action was a demonstration of "a fascist mentality".

He said such behaviour should be stamped out without mercy and called on the Attorney-general to appoint an independent investigator to look into the incident and on the senior officers allegedly involved to be suspended.

Limassol Police Director Theodoros Stylianou said the force would investigate the report, but stressed that police officers did not invade private homes without warrants.

Copyright Cyprus Mail 2002

[06] Omirou outlines European vision

KISOS Chairman and presidential candidate Yiannakis Omirou yesterday said his programme and philosophy had a clear European bearing, free of Euro- phobia or scepticism.

Speaking at a news conference yesterday, Omirou said KISOS and his former partners in the three-party coalition, AKEL and DIKO, had had substantial differences concerning the island's EU accession course.

He said his two former partners had "inhibitions and reservations, for example, concerning Cyprus' accession to the European defence framework", as well as to committing themselves to joining the single currency.

Omirou said the island's EU accession course was the biggest achievement since the tragedy of 1974, stressing that the nation's strategy should be to join the EU by 2004.

He added that the country was going through critical, historic moments that would determine its future for the coming decades.

"Cyprus' European course is coming to its final stage; the stage of making the final decision that will lead us to European accession," Omirou said.

Achieving this vision would reinforce Cyprus and its people and end Turkey's ability to hold the island's future in hostage, he added.

The KISOS Chairman urged all political forces to show unity, adding there were grounds for co-operation with more logical, pro-European spheres in Turkey.

"With them, we could discuss the Cyprus problem, on the basis of a fair and viable solution; on the basis of a peaceful coexistence of the two communities with respect for the human and political rights of the people as a whole," Omirou said.

Copyright Cyprus Mail 2002

[07] Hi tech strawberry project beats the red tape at last

ALMOST a year after applying to set up a strawberry farm in Kalavassos, a British businessman has finally got the operation off the ground, but in another area after the government refused him permission to use water from the Kalavassos reservoir.

Geoffrey Gunson, a resident of Cyprus for 11 years, told the Cyprus Mail yesterday that despite the latest red-tape obstacle, he had managed to find a way forward to realise his project, Straw Bear Ltd.

"At the beginning of last month, I leased a farm in Kellaki," he said, adding that it had a 2,800 square metre greenhouse and four donums of land complete with water, electricity, phone lines plus extra land for future expansion.

"We have now changed our business plan to focus more on strawberry plant propagation but combined with fruit production," he said. Gunson plans to produce five million plants per year by 2005, increasing to ten million plants by 2007. "These will be for export to the eastern Mediterranean region," he said, adding he had already secured an agreement with the largest plant producer in Europe.

Since he secured permission for his company from the Central Bank almost a year ago, Gunson has run into one difficulty after another in his quest to produce hydroponically-grown strawberries, which would make the fruit available all year round.

Initially, he applied to buy 22 donums of land last year to produce the strawberries, but the law limits foreign ownership of land to three donums. The Larnaca District Office finally rejected his application after much delay, stating that hydroponics was not a very important technology for Cyprus.

Hydroponics is a semi-organic method of producing certain types of agricultural produce without using soil. Hydroponically grown produce has a longer shelf life and strawberries grown by this method can last up to a week in the fridge.

It is considered a 'hi-tech' form of production, which produces strawberries for 52 weeks of the year. The climate in Cyprus is ideal for hydroponics because heating costs in winter are considerably less than in Europe, giving Cyprus an advantage over its foreign competitors.

Gunson then leased 40 donums of land near Kalavassos to set up the strawberry farm. The location is over 100 metres above sea level making it perfect for hydroponics, but he then failed to obtain permission to use water from the reservoir.

Referring to his new plans, Gunson said; "So at last after one year of too many problems and headaches and a considerable personal financial cost we have finally succeeded."

The British businessman was sure the project would be successful "and can only be good for Cyprus as it will put this country at the forefront of strawberry technology".

Straw Bear's first plants were grown from runners last month and are now in storage awaiting planting in less than 10 days' time, while the next shipment of runners will arrive this week. "Our first production will be available in the first week of November and we will produce 52 weeks per year, which nobody else can achieve in Cyprus," he said. The company also intends to have a showcase in Limassol next week, for which Gunson is importing 300 kilos of fruit from Belgium.

Copyright Cyprus Mail 2002

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