greece

Introducing Greece

Overview

Greece is strategically located between the mainland of Europe and the Middle East. It lies in the south of the Balkan Peninsula and is bordering to the north with Albania, FYROM (Former Yugoslav Republic of Macedonia) and Bulgaria. Greece shares its border with Turkey while its western front faces the Adriatic Sea and its southern side straddles the Mediterranean Sea. The country covers an area of 32,000 km2. Greece is a mountainous peninsula with fertile plateaus, coastal belts and about 50 inhabited islands, of which Crete is the largest. The climate is relatively mild during the winter. Daytime temperatures are usually between 6° C and 14° C with many hours of sunshine. The summer is warm, with temperatures between 28° C and 36°C. Low humidity and rainfall make the country and its islands in particular, one of the most popular vacation destinations in the world.
It boasts a well educated workforce and is a member of the Euro-zone. The tourism and shipping industries are very important in the country, and are growing rapidly. English is widely spoken, especially within the business Community. Historically, Greece represents one of the most ancient civilisations, with advanced cultural and political institutions dating back to 500 B.C.

Athens by night

During the Roman era, the country became part of the Roman Empire, becoming later one of the main administrative areas of the Byzantine Empire. Following the conquest of Constantinople by the Turks, Greece became a territory of the Ottoman Empire for nearly four centuries and achieved its independence in1829. It was only after a series of local wars that Greece stabilised its present territory. The period ending in 1974 was often characterized by political instability, culminating in the seven-year military coup of 1967. The 1974 democratic elections and a referendum created a parliamentary republic and abolished the monarchy, giving way to decades of relative political stability continuing through today.

Economic development

A number of state agencies supervised by the Ministry of Economy are responsible for handling different aspects of the government and finance programs for economic development, including the National Tourist Organization (EOT), the Center of Planning and Economic Research (KEPE), the Hellenic Center for Investments (ELKE), and the Hellenic Organisation of Small and Medium-sized Enterprises and Handcrafters (EOMMEX).

The business climate

A significant part of the economic activity is dominated by state-owned corporations. These have either total or almost total control of the railway, air-line, postal services, energy and natural resources, as well as sugar industry and arms and ammunition manufacturing. Most private businesses in Greece are small, operating as either family businesses or partner-ships with less than 50 employees. Share ownership in quoted companies is limited, but the Athens Stock Exchange continues to attract new listings every year. Government policy during the last decade aimed at keeping unemployment low while countering prolonged investment stagnation, which resulted in a significant expansion of the public sector and placed great strain on the economy. In recent years, government policy has been focused on the introduction of tight "austerity" budgets to restrain public spending and rationalize public debt. After achieving convergence with the E.U. and the full inclusion of the country in the Eurozone, the goals of the economic policy are to keep inflation and unemployment at low levels, reduce the wider public sector with extensive privatisation, complete infrastructure work in the country, and fund private investment programs among other targets.

The government welcomes foreign investment and supports the free enterprise and free-trade system. Greek and foreign investors are treated equally, while repatriation of proceeds and transfer of profits are effected through mediating banks without restrictions. With respect to investment, foreign ownership is permitted without restriction in almost all sectors (state-controlled companies included). However, some sectors like the arms industry are state-owned, and still closed to private investors. The most common forms of business establishment for foreign investors are the corporation (société anonyme) and the limited liability company. A minimum capital requirement is imposed on both sociétés anonyms and limited liability companies. General and regional tax and other incentives are available to both local and foreign investors. In addition, special industry incentives are also available to investors in general.

An investor can either form a company or acquire an existing one without any requirement for approval by the Greek government in relation to the valuation of the acquisition.

The government encourages establishment of industrial enterprises within specific industrial areas near the major cities of the country specially designed to offer infrastructure and facilities for industry. Location in less-developed areas or in the industrial areas is encouraged through higher incentives. Moreover, long-term financing from specialized credit institutions is available to local and foreign investors. Credit and financial services are also available from a large number of domestic banks and branches of foreign banks. Finally, profits are taxed at the company level, and dividends are distributed free of any withholding or income tax. Regarding trade policy, as a member of the EU, Greece is part of a constantly growing unified market of 380 million people, and the country is free of any restrictions or other legislation aimed at providing distinctive assistance to the local market. Greece offers tax and other incentives for manufacturing, tourism and advanced technology. The taxation system does not discriminate against foreign investors, as tax incentives are provided to all types of businesses. Worth noting too is that the domestic market is also receptive to imported products.

The full implementation in 1994 of the free movement of capital and foreign currency resulted in the abolition of all relevant restrictions and related procedures existing for investments. Therefore, Greece now has no restrictions or obligations for special procedures concerning foreign investment of non-EU origin. In general, all usual forms of carrying on business are open to foreign investors, i.e., licensing, importing and manufacturing through a branch or subsidiary; partnerships, or sole proprietorships. The presence of Greece within the EU market and its proximity to the emerging markets of Eastern Europe and to the Middle East make it a convenient location for companies to expand their distribution rapidly. Therefore, many foreign investors seeking to expand their markets are investing in Greece by acquiring established distribution networks either through the purchase of existing companies or establishment of their own companies. Because of the government's privatisation program several companies are becoming available for sale to local or foreign investors.

Overall, the government's favourable policy toward foreign investment is expected to continue in the future, as government policy encourages all types of productive investment that generate economic growth and employment through industrialization, manufacturing, automation, construction, expansion, and modernization of production with a package of non-tax and tax incentives. Generally, the incentives for investment are aimed at the industrial or tourist development of specific regions more than others.

 

Establishment of an S.A. Company in Greece

A Limited By Shares Company called in Greek Law "Anonymous Etairia", A.E.", is formed according to the provisions of Law 2190/20 as amended and currently in force, by:

Presidential Decree 409/86,
Presidential Decree 498/87,
Presidential Decree 56/91,
Presidential Decree 14/93,
Presidential Decree 360/93,
Presidential Decree 367/94,
Presidential Decree 326/94,
Presidential Decree 325/94,
Presidential Decree 882,94,
Presidential Decree 60/01 and
Law 2065/92, Law 2166/93, law 2286/95, Law 2339/95, Law 2523/97, Law 2941/01, Law 3604,07.

A Limited By Shares Company (Corporation) is a stock company in which the liability of a shareholder is limited to the amount of contributions to the capital, which is represented by shares of stock.

Establishment

The formation of a Limited By Shares Company (S.A.) may be incorporated by a sole shareholder or more, who may be natural person/s or legal entity/ies and involves the following stages:

• Draft of articles of association.
• Pre-validation of tradename by the competent Commercial Chamber.
• Signing of the incorporation of the company (adoption of the statute) before a Notary.
• Approval of tradename/registration by Commercial Chamber.
• Administrative authorization, only for companies whose share capital exceeds the amount of Euros 3.000.000.
• Registration of the company in the S.A. Companies Registry (the companies whose share capital does not exceed the amount of Euros 3.000.000 - with the exception of banks, insurance companies etc) register their articles of association in the Registry, without the issuance of an administrative decision).
• Publication of the Government Gazette. In particular:
• Filing of application for the pre-validation of the Company's tradename with the competent Chamber of Commerce, which is valid for two months. (deposit of Euros 30).
• Composition of Draft Articles of Association / Statutes (deposit to (Athens) Bar, competition fee 1%, Government Gazette publication fee regarding establishment).
• Pre-approval of Company"s tradename by the Chamber of Commerce and issue of relevant certificate in two copies (one of which is certified to be filed with the Prefecture).
• Place of business must be established (it is eventually required definitely during the registration with the tax authorities, where a certified signed lease (or any other: purchase, own-use statement) must be submitted.
• Filing of the drafted Articles of Association with the competent Prefecture (together with a relevant application, the receipt of payment for the publication of a resume of the establishment in the Government Gazette (Euros 544.67), the resume itself, receipt of payment of the competition fee (1%), Prefecture's announcement in seven copies, certification of Chamber of Commerce regarding the pre-approval of the Company's tradename).
• Share Capital (minimum - Euros 60,000 must be either paid or at least founders must have undertaken the obligation to make payment before the publication - incorporation of the company).
• Pursuant to the filing of the above, the Prefecture both issues the relevant administrative authorization and approval of the Articles of Association when the authorization is needed, as well as registers the company in its registrar, which (time-wise) means that the text may be given for publication and the Tax of Capital Concentration may be paid, in order to issue a taxpayer's registration number.
• Companies that do not need an administrative authorization may be registered in the S.A. Companies registry within a day.­
• Please note that within one month from the above date (of registration and authorization) the Company must file with the Prefecture a copy of the announcement of the Prefecture regarding the establishment certified by the competent Tax Authority (the payment of the Capital Concentration Tax - 1% - is a prerequisite for such certification) and a receipt by the National Printery, evidencing filing of the documents for publication.
• Registration with the competent Chamber of Commerce (deposit Euros 372).
• Within two months from the establishment of the Company, the latter's Board of Directors must hold a meeting to verify payment of the share capital. a) Adoption of the Statutes When forming a Limited By Shares Company the founders of the company must adopt the statutes of the company and sign the articles of incorporation before a notary. The Law provides the minimum content of the statutes which is: the name and objet of the company, the registered office, the duration, the amount and the way of paying in the subscribed capital, the kind, number, nominal value and the issue of the shares, the appointed auditors, the rights of the share holders, etc. (Article 2 of Law 2190/20, as amended by Article 2 of Presidential Decree 409/86 and art.4 of Law 3604/2007). b) Administrative Authorisation The statutes of companies whose share capital exceeds the amount of Euros 3.000.000, must be approved by the responsible prefecture-department of commerce, in Athens or depending on where the corporation is to be established. c) Publication/Registration
• After the signing of the notary deed containing the statutes, the company is registered in the Companies' Registry of the Prefecture (where the company's registered office is located).
• A summary of the deed containing the names of the founders, the company name, the registered office, the object of the company and the capital, the way of representation of the company etc. must be published, under the supervision of the Board of Directors, in the Government Gazette, "Bulletin of Limited By Shares and Limited Liability Companies". The company acquires legal personality, only after the registration of the company's articles of association in the Companies' Registry and the administrative authorization when needed.
• Upon establishment, the company is required to register with the Tax Office and procure accounting and company books stamped by the Tax Authorities and also register with the Local Chamber of Commerce. For the purpose of such registration, the capital concentration fee (1%) must be paid within 15 days from the registration to the Companies' Registry.

Operation Structure

The General Meeting of the Shareholders is the supreme governing body of a Limited By Shares Company having the right to decide on all matters concerning the company. The Board of Directors has the executive powers of the company (including representative authority).

a) Shareholders' General Meeting The General Meeting of the shareholders has the sole authority to decide on:
• Amendments to the statutes, including capital increases or reductions.
• Election of Directors and Statutory Auditors.
• Approval of the company's balance sheet.
• Approval of annual profits and director's fees.
• Issuance of bonds. • Amalgamation, extension of duration, or dissolution of the company.
• Appointment of liquidators. An annual (ordinary) General Meeting of the Shareholders must be held within six months of the end of each fiscal year. Extraordinary General Meetings may be held at any time according to the procedure provided for by the Law. General Meetings are held at the registered office of the company, or anywhere in Greece or abroad, by virtue of a provision in the articles of association or by representation in the meeting of the total share capital of the company. The General Meeting may convene via teleconference; moreover shareholders may appear and exercise their voting rights from a distance, following relevant provision in the articles of association. The signing of the minutes by "circulation" is possible for non-listed companies.

b) Board of Directors The management of a Limited By Shares Company is the responsibility of the Board of Directors. The Directors are elected by the General Meeting of the Shareholders. A Director need not be a shareholder. It is possible for a legal entity to be appointed as a member of the Board of Directors provided there is a relevant provision in the articles of association. The Board of Directors may also convene via teleconference and the signing of the minutes by "circulation" is possible. The statutes may delegate certain authority to one or more Directors or Executive Directors of the company.

 

Public Private Partnerships in Greece

Agency & Distribution Agreements under the E.U.

Greece has come to Public Private Partnerships relatively late amongst the older nations of Europe. Recognising that it will face stiff competition for resources in what is becoming an increasingly globalised market, the PPP Unit of the Ministry of Finance has taken care to plan a programme to excite interest at home and abroad. The success of this approach can be judged from the number of companies from beyond the borders of Greece attending the recent conferences to promote the PPP programme. Contractors, investors, senior lenders (including, very importantly, the European Investment Bank) and advisers from across Europe and beyond have been actively assessing opportunities.

There are 32 projects in the first wave across a wide range of sectors including government buildings, schools, hospitals, defence, leisure, security and waste. The projects range in size from €16 million to €342 million both NPV (in each case plus 20% for insurance and heavy maintenance). Some of the smaller projects fall below what would be regarded in some countries as suitable for a PPP and it will be interesting to see how the market responds to these smaller deals. One common feature of PPPs is that the bidding stages are expensive for both the procuring authority and the bidders relative to conventional procurement.

Perhaps in recognition of the cost issue, the PPP Unit has so far adopted restricted procedure for tenders for the few PPP projects that have so far come to the market. This should have the effect of simplifying and accelerating the process compared to countries where competitive dialogue is used for PPPs. There will, however, be a price to be paid by the Greek government for using restricted procedure, in terms of reduced scope for the private sector to introduce innovative solutions. It also seems possible that a single round bidding process will not yield the level of price competition that is achieved when bidders have to refine their prices through several bid rounds. It remains to be seen whether the use of restricted procedure will deliver the same value for money as is seen in PPPs elsewhere.


Historically there have been certain cultural features of tendering for public works in Greece that may have tended to deter foreign companies from becoming involved. The PPP Unit has been very open in recognising the need to address this issue head-on and its adoption of restricted procedure for all procurements so far under the PPP programme (the advisory appointments as well as the project themselves) is at least in part designed to ensure that all tenders are awarded on strictly objective and verifiable grounds. Nobody should be in any doubt as to the criteria that will be applied to select the preferred bidder and how they are going to be applied and there should be little or no scope for argument after the event.

At the time of writing (early June 2008) only two PPP projects have reached the stage of having a short-list of pre-qualified bidders and only one of those (7 new fire stations for the Hellenic fire brigade) has issued tender documents to the bidders. It was already known that the PPP Unit intended to learn from the experience of countries with more established PPP programmes, especially the UK. The fire stations Partnership Agreement very closely follows the standard form of Project Agreement published in the UK by the 4Ps, which in turn conforms to version 4 of the guidance on standardisation of PFI contracts published by HM Treasury in the UK, commonly known as SOPC4. Minimal changes have been made to convert the standard from English to Greek law. This should be comforting for everyone concerned, but especially any international participants, as the risk allocation between the public and private sectors represented by SOPC4 has been thoroughly tested and has been shown very many times to be bankable in the project finance market.
There are some areas of concern, where we must all await developments with interest. Although there have been several large BOT projects in Greece, there is relatively little experience of project finance and the disciplines that it introduces. Of necessity, there are lessons that will have to learned here.

There is almost no facilities management industry in Greece. It is an essential feature of PPP projects that there is a competitive industry able to provide the long term operation and maintenance of the facilities procured through PPPs. These projects will typically last for 25 years or more with the construction phase being complete within the first two or three years of all but the very largest projects. Most of the long term risks, therefore, arise in the operation and maintenance phase. The majority of those risks will need to be subcontracted to the facilities management or operations subcontractor, who will be locked in at a fixed price (other than indexation for inflation) for the duration of the project. One of the essential protections for the funders (senior debt and equity) is the ability to remove the facilities management subcontractor if the project is running into problems and appoint a replacement. The funders have to be confident that there will be a competitive market to which they can turn to find the replacement at a reasonable price. In many other countries there is a thriving facilities management industry quite apart from PPPs. It is reasonable to expect that the Greek PPP programme will prove to be the catalyst for the growth of such an industry in Greece and there looks to be a real gap in the market here, ripe for exploitation. Without it, the PPP programme may struggle.

The PPP Unit is promising that it will bring a first wave project to the market more or less every month. They have recognised that deal-flow is one of the keys to ensuring healthy interest from investors, senior lenders, contractors and advisers. It is also clear that there is a recognition on the public sector side that profit is not a dirty word. Private sector businesses exist to make profits and they must be allowed a reasonable opportunity to make a fair return if the PPP programme is to be a success. There is strong international competition for money, expertise and other resources for PPP projects. Greece has understood this and gone out of its way to make its PPP programme attractive. There are sure to be some hiccups along the way and doubtless things will not go quite as quickly as the government might hope, but all the signs are that the Greek PPP programme is going to be a great success.

Greek Investment Incentives Law 3299/2004

A Summary

Business activities falling under the provisions of the investment incentives law The Incentives Law is applicable to enterprises having business activities in the following sectors:

• Primary (e.g. greenhouses, animal farms, fisheries etc.).
• Secondary (e.g. manufacturing, energy etc).
• Tertiary:
- tourism (hotel units, conference centres, marinas, thematic parks, golf courses, development of mineral springs, thalassotherapy centres, health tourism centres, centres for training-sports tourism etc).
- other services (e.g. applied industrial research laboratories, commercial centers, software development, supply chain services, logistic centres etc.). Business activities, which fall under the provisions of the Law, are divided in five categories and are described in detail (see CATEGORIES OF BUSINESS ACTIVITIES). The exempted cases, which fall under other incentive means, are also noted. Division of the country into zones For the application of the provisions of the Law, the?Country is divided into four zones, as follows:

• ZONE D: Zone D is divided into sub-zones D1, D2 and D3 as follows:

D1: Includes the border line zone of the continental part of the regions of Central and Western Macedonia up to 20 km from the border, including the municipalities the administrative boundaries of which cross with the said zone, the Prefecture of Dodecanese except the area specified in the ministerial decision of the general city plan of the city of Rhodes, the islands of the Administrative Region of Central Macedonia, Thessaly, Ionian islands, Continental Greece, Attica, South Aegean and Crete, which have up to 3.100 inhabitants according to the 1991 census.
D2: Includes the border line zone of the continental part of the region of Epirus up to 20 km from the border, including the municipalities the administrative boundaries of which cross with the said zone, the Industrial Business Estates (I.B.E.) of the region of Epirus, the islands of the region of Northern Aegean, and the islands of the region of Epirus, Western Greece and Peloponnese, which have up to 3.100 inhabitants according to the 1991 census.
D3: Includes the Prefectures of Drama, Kavala, Xanthi, Rodopi and Evros.
• ZONE C: Includes the Lavrion Zone of Attica Prefecture, as it has been set out by the joint decision no. 37349/5.11.1991 (Government Gazette B’950) of the Ministers of Environment, City Planning and Public Works, Economy and Finance and Interior as well as the Regions, the Prefectures or parts of Prefectures of the?country which do not fall within the?zones D’, B’ and A’.
• ZONE B: Includes the I.B.E., the Langada region and the area west of the Axios river in Thessalonica Prefecture as well as the Trizinia region of Attica Prefecture.
• ZONE A: Includes the Attica and Thessalonica Prefectures, except their parts that may be included in the other zones.? Incentives on offer For the investment projects which fall under the provisions of the Law, the following incentives are available:
a1) Cash grant, which covers part of the expense for the investment project by the State and/or
a2) Leasing subsidy, which covers part of the payable installments by the State relating to a lease which has been entered into for the use of new mechanical and other equipment or, alternatively
b) Tax exemption. This incentive involves exemption from payment of income tax on non distributed gains for the first 10 years following completion of the investment, through the creation of a tax exempted reserve. or, alternatively
c) Cash grant for the expenses of wages relating to the employment created by the investment.

The above incentives are offered under the terms and conditions set out in the Investment Incentives Law. For the investment plans, the following incentives are offered according to the?zone?and the category, i.e.:
(a) Cash grant and/or leasing subsidy as per the percentages in this table:

Investment ZONE ZONE ZONE ZONE ZONE ZONE
Category     A        B        C        D1      D2      D3
Category 1 0%    18%    30%    35%    40%    40%
Category 2 0%    13%    25%    35%    35%    35%
Category 3 40%  40%    40%    40%    40%    40%
Category 4 30%  30%    35%    35%    40%    40%
Category 5 35%  35%    35%    35%    35%    35%

Note: For more detailed and complete information see the section: “CATEGORIES OF BUSINESS ACTIVITIES”


On the above percentages (except the investments of category 5), an additional percentage of 5% in total is added, provided that one or more of the following conditions apply:

• Location of the enterprises inside I.B.E.?
• Establishment of a hotel unit of 4 or 5 stars category (A or AA class).
• Modification of a traditional or listed building into a hotel unit
• Renovation of a hotel unit involving its upgrading to a 4 or 5 stars category.
• Renovation of a hotel unit situated at a traditional or listed building.?
• Location of the tourist enterprises inside Integrated Tourist Development Areas (I.T.D.A.).
• The enterprise is newly established, i.e. in cases where less than a year has elapsed between the establishment of the enterprise or the start of its business and the submission of the petition under the Incentives Law. Or, alternatively: (b) Tax exemption as per the percentages in this table:

Investment ZONE ZONE ZONE ZONE ZONE ZONE
Category    A        B        C        D1      D2      D3
Category 1 0%    50%  100%  100%  100%  100%
Category 2 0%    50%  100%  100%  100%  100%
Category 3 100% 100% 100% 100% 100% 100%
Category 4 100% 100% 100% 100% 100% 100%
Category 5 100% 100% 100% 100% 100% 100%

Note: For more detailed and complete information see the SECTION:  “CATEGORIES OF BUSINESS ACTIVITIES”
Or, alternatively: (c) Cash grant for the expenses of wages relating to the employment created by the investment as per the percentages in this table:

Investment ZONE ZONE ZONE ZONE ZONE ZONE
Category     A        B        C        D1      D2      D3
Category 1 0.0% 18.4% 35.1% 40.0% 45.5% 48.1%
Category 2 0.0% 18.4% 33.2% 40.0% 45.5% 45.5%
Category 3 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%
Category 4 35.0% 35.0% 40.0% 40.0% 45.5% 48.1%
Category 5 35.0% 35.0% 35.0% 35.0% 35.0% 35.0%

Note: For more detailed and complete information see the section: “CATEGORIES OF BUSINESS ACTIVITIES”

Please note:
(a) Employment positions relative to the investment are considered new employment positions which are created for the assistance of the investment within the first three years of its completion and start of productive operation.
(b) The cash grant is payable on the expenses for wages for the total employment positions relative to the investment for the first two years as of the creation of each employment position. By ‘expenses for wages’ it is understood the salary “before taxes” and the compulsory contributions to social security. Eligible for the grant are enterprises which operate in every sector of the economy, if they fulfill the criteria for the submission to the incentives system, as laid out in the Law. To small/medium size enterprises, as these are from time to time defined in the E.U. legislation, an additional percentage of subsidy up to 15% is granted. In any event the offered percentages of cash grants and leasing subsidies as well as of subsidies for the wage expenses cannot exceed 55% of the total investment plan. The offered subsidies to any person cannot exceed, cumulatively, for a five year period, the maximum amount of twenty million (20.000.000) EURO for investments involved in the same productive activity.

Terms and conditions for obtaining the incentives
a)?Investor’s own participation The percentage of the investor’s own participation in investments which are included in the cash grants and/or leasing subsidies system cannot be less than 25% of the subsidized expenses, whereas in the investments which are included in the tax exemption or the cash grant for wage expenses for the created employment, at least 25% of the cost should be covered by the financial participation of the investor, either by own funds or loan, provided that no state subsidy accompanies this part.
b) Commencement of realization of the investment plans which fall into the provisions of the Law The commencement of the realization of the investment plans may take place after the submission to the competent authority of the petition requesting submission of the investment in the provisions of the Law. Budget revision of the investment cannot exceed 15% of the initial cost. In the decision for eligibility under the provisions of the Law a time limit for completion is set, which may be increased by two (2) years maximum, under conditions. Subsidized expenses The determination of the expenses, which are subsidized per investment category, is made by a ministerial decision. The Law contains a list of said expenses as well as of the expenses which do not fall under its provisions. The subsidized expenses should involve consolidated assets. The subsidization of intangible investments or fees of consultants is possible, but only up to an 8% of the investment plan cost. Operational expenses are not subsidized.

Procedures and application of the investment incentives law
A) Submission of petitions for obtaining the incentives under the law Petitions for investments (except those involving the tax exemption subsidy, for which no submission of petition is necessary) are submitted during all the year as follows:

(a) To the General Directorate for Private Investments of the Ministry of Economy and Finance there are submitted petitions relating to i) investments for projects over four million (4.000.000) EURO, which take place within the limits of the Region of Central Macedonia as well as ii) investments for projects over two million (2.000.000) EURO, which take place at the rest of the State as well as iii) certain investments irrespective of the amount involved, according to specific regulations.
(b) To the Directorates of Planning and Development of the Regions there are submitted petitions relating to investments for projects up to two million (2.000.000) EURO, which take place within the limits of each Administrative Region or, in case of the Region of Central Macedonia, projects up to four million (4.000.000) EURO.
(c) To the Hellenic Center for Investment (ELKE) there are submitted petitions relating to investments for projects over fifteen million (15.000.000) EURO as well as investments or business plans of three million (3.000.000) EURO or more, in case that at least? 50% of the investor’s own participation derives from imported capital.
(d) To the General Secretariat for Industry of the Ministry of Development, certain petitions are submitted relating to specific sub-categories and according to specific regulations.

B) Supporting documents of the petition:
(a) Feasibility study
(b) Evidence of payment of the required dues
(c) Any additional supporting documents according to each case
C) Approval procedure The procedure of evaluation of each petition of investment proposal is completed by the competent authority and the competent consultative committee within two (2) months, at the latest, as of the date of submission of the petition. The decision approving the petition is issued within one (1) month, at the latest, as of the issue of the opinion by the consultative committee. Within the same month the summary of the decision is also published in the Government Gazette. For the review of the petitions by the competent consultative committee a strict order of priority is kept, according to the time of submission of each petition.
D) Payment of subsidies The Law provides for the conditions, terms and limitations which relate to the possibility of using a bank loan.
(a) Payment of cash grant: The payment of the subsidized amount is made in instalments as follows:

• Payment of 50% of the cash grant amount is made after the completion of 50% of the investment and verification by the competent monitoring authority of this fact and of the compliance of the investor to the terms of the decision approving the investment.
• Payment of the remaining 50% of the cash grant amount is made after verification by the competent monitoring authority of the completion and commencement of the productive operation of the investment. Drawing of the funds is made within 5 months.
• There exists the possibility of a lump sum advance (as part of the total subsidy), which will not exceed 30% of the approved by the relevant decision cash grant, if a bank guarantee is submitted in an amount equal to the advance plus 10%, issued by a bank which is established and operates legally in Greece. The subsidy is paid directly to the investor or directly to the financing bank which granted a short term loan to the company which carries out the investment plan.

(b) Payment of leasing subsidy: Payment is effected after the mechanical equipment etc has been put in place and the verification of this fact. An initial payment of 50% is made until the end of the completion period provided for in the decision approving the investment. The remaining amount is paid after the lapse of the completion period, provided that the completion of the investment and the commencement of operation is verified.
(c) Payment of cash grants for wage expenses: Payment is effected every six months, after a relevant application of the investor. Monitoring and control Monitoring of the approved investments is made by the competent authorities and the various types of controls are made by the teams which are created by a decision of the relevant competent authority which is responsible for each investment. Special cases under the provision of the investment incentives law By joint decisions of the Ministers of Economy and Finance, and Development, as well as any jointly responsible ministers as the case may be, there are set out the necessary divergences from the regulations of the Law, which relate to the investor’s participation by own funds, the procedure for the award of the grants, the percentages and the amount of subsidy, the amount of bank loan, the percentages of leasing subsidies, the cash grants for wages expenses and the tax exemption, the conditions of company shares’ transfer as well as the possibility of public corporations participating in the investment, in case of investments of at least fifty (50) million EURO and more, which have a significant effect on the international competitiveness of the country and the employment (creation of least one hundred and twenty five (125) permanent job positions, out of which a certain number may be created in satellite enterprises as a direct result of the proposed investment).
Further, by the same decisions, the construction of special infrastructure works at the expense of the public may be determined for the facilitation of the operation of the unit in general. Categories of business activities Business activities which fall under the provisions of Incentives Law

CATEGORY 1

(i) Investment plans for mining and crushing of industrial minerals and inactive materials.
(ii) Investment plans for mechanical means of sowing, cultivating and harvesting of agricultural products by agricultural or agricultural/industrial co-operatives or groups of producers or associations of groups of producers, which have been established according to Community legislation.
(iii) Investment plans for standardising, packing or preserving agricultural or livestock products or fishery and fish-farming products, which do not derive from any alteration process.
(iv) Investment plans for agricultural enterprises of greenhouse type and bio farming, enterprises of livestock breeding (stables or semi-stables type) and fishery enterprises (aquaculture) using modern technology.
(v) Investment plans for mining, treating and utilizing industrial minerals in general. Investment plans for quarrying and utilizing marbles, provided that they include the cutting and manufacturing equipment.
(vi) Investment plans for minerals.
(vii) Investment plans for the sector of alteration process, save those for which a joint ministerial decision is required for their submission to the Incentives Law.
(viii) Investment plans for the production of energy in the form of hot water or vapors.
(ix) Investment plans for the production of bio fuels or solid fuels out of biomass, investment plans for the production of biomass from plants with the objective of using same as material for the production of energy.
(x) Investment plans for the desalination of sea or brackish water for the production of potable water
(xi) Investment plans for the production and/or standardization of Geographical Indication Products (G.I.P.) and/or products of Protected Name of Origin (P.N.O.) provided that they are made by enterprises which are located in traditional or listed stone buildings and/or building blocks of industrial nature, save those for which a joint ministerial decision is required for their submission to the Incentives Law.
(xii) Establishment, expansion, modernization of thematic parks which consist of organized forms of tourism and which differentiate or expand the tourist product and offer complete infrastructures and services, including (at least) services related to housing, eating, recreation and social care.
(xiii) Establishment, expansion, modernization of highways necessary for the tourist development of the country.
(xiv) Investment plans for building and utilization of arts and crafts centers and buildings in the special arts and crafts and industrial zones which are determined according to the city and urban planning as well as areas for social or cultural operations, central markets and slaughter houses run by municipal enterprises of 1st or 2nd degree or by co-operatives. Also, investment plans by the same interests for the modification and rearrangement of old industrial estates and other installations as areas of social and cultural operations, exhibition centers, central markets and slaughter houses.
(xv) Investment plans for enterprises of liquid fuels and liquid gases, for the production of storage installations or the supply of equipment for the transport of liquid fuels and liquid gases to an island.
(xvi) Investment plans for the establishment of recovery and rehabilitation centers, as these are defined in article 10 of Law 2072/1992 and investment plans for the supply of housing for independent living to people with special needs.

CATEGORY 2

(i) Establishment or expansion of hotel units of at least 3 stars (3*), formerly B’ class.

CATEGORY 3

(i) Investment plans for the establishment of closed parks for public use by privately owned vehicles of at least forty (40) lots, in addition to those that are obligatory by the General Planning Code (G.P.C.) for covering the permanent needs which derive from the usages of the building, provided that they are run by enterprises for public usages, or for car parks above the ground, underground and/or floating. Also, investment plans for the establishment of covered and/or semi-covered public usage parks for trucks, busses and other heavy vehicles in general, of 30 lots at least.

CATEGORY 4

(i) Investment plans for the production of electricity from mild types of energy and especially solar energy, aeolic energy, hydro electrical energy, geothermic energy and biomass, investment plans for co-production of electricity and heat.
(ii) Investment plans for the relocation of tanneries from the Attica, Thessalonica and Chania Prefectures, in Industrial Business Estates (I.B.E.) where the appropriate infrastructure exists and their setting up is envisaged.
(iii) Modernization of already functioning hotel units (complete type) of at least two stars (2*) category, formerly C’ class or hotel units which have suspended temporarily their operation for five years maximum, provided that no change to the use of the building has been made during that period and provided, further, that at the time of the temporary suspension of their operation they belonged to two stars (2*) category, formerly C’ class, at least.
(iv) Modernization of already functioning hotel units (complete type) of a lower category than two stars (2*), formerly C’ class, which are located in traditional or listed buildings, provided that by such modernization they are upgraded at least to the two stars (2*), formerly C’ class category. Also, modernization of hotel units (complete type) which have suspended temporarily their operation for five years maximum, provided that no change to the use of the building has been made during that period and provided, further, that by such modernization they are upgraded at least to the two stars (2*), formerly C’ class category.
(v) Modernization of hotel units involving the creation of additional installations by adding new common areas, new uses of common area, pools and athletic installations to hotel units belonging to two stars (2*) category, formerly C’ class, at least, with the objective of providing additional services.
(vi) Modification of traditional or listed buildings into hotel units belonging to two stars (2*) category, formerly C’ class, at least.
(vii) Modernization of already functioning organized camping units (complete type) belonging to C’ class category, at least.
(viii) Establishment, expansion, modernization of conference centers.
(ix) Establishment, expansion, modernization of ski resorts.
(x) Establishment, expansion, modernization of development of mineral springs.
(xi) Establishment, expansion, modernization of tourist marinas for pleasure yachts for investment plans run by any physical or legal person of private law.
(xii) Establishment, expansion, modernization of golf courses.
(xiii) Establishment, expansion, modernization of thalassotherapy centers.
(xiv) Establishment, expansion, modernization of health tourism centers.
(xv) Establishment, expansion, modernization of training-athletic tourism centers.
(xvi) Investment plans for cooperating commercial and transport enterprises under a common venture, for the creation of commercial stations and logistic centers, as such terms will be defined by a joint ministerial decision.
(xvii) Investment plans by transport enterprises for the creation of infrastructures relating to storage, packing and standardizing as well as closed parking areas for trucks, as such terms will be defined by a joint ministerial decision.
(xviii) Investment plans for the provision of supply chain services.
(xix) Investment plans for the creation of wide-zone network infrastructures and other similar equipment which ensures the access by citizens or enterprises, at the level of municipal authorities, Regions etc or other geographical areas with commercial interest.
(xx) Investment plans for the provision of innovative wide range telecommunication services, which rely on the wide-zone infrastructures.
(xxi) Investment plans for software development.
(xxii) Investment plans for the creation of laboratories of applied industrial, energy, mineral, agricultural, livestock, forestry and fishery research. Also, investment plans for the development of technologies and industrial plans.
(xxiii) Investment plans for the provision of highly advanced technology services.
(xxiv) Investment plans for the creation of laboratories for the provision of services relating to quality and/or high technology, certification, control testing and verification.
(xxv) Investment plans for enterprises of development of transportation means for humans and merchandise to isolated, inaccessible and remote areas, as such are defined by a joint decision of the Ministers of Economy and Finance and Mercantile Marine.
(xxvi) Investment plans for the protection of environment, reduction of pollution relating to ground surfaces, underground surfaces, waters and the atmosphere, restoration of the natural environment and recycling of water and desalination of sea or brackish water.
(xxvii) Investment plans for the development of renewable sources of energy, substitution of liquid fuels or electrical? energy by gas fuels, processed rejected materials from local industries, renewable sources of energy, recovery of rejected heat as well as co-production of? electrical energy and heat.
(xxviii) Investment plans for energy saving, provided that the investment plan do not involve the equipment for the production and, instead, it involves the equipment and installations for the movement and operation of the unit and that at least a 10% decrease of the utilized energy is effected.
(xxix) Investment plans for the production of new products and/or services or products of highly developed technology. (xxx) Investment plans for the establishment, expansion, modernization of laboratories of applied industrial or mineral or energy research.
(xxxi) Investment plans for importing and adapting environmental friendly technology to he production process.
(xxxii) Investment plans for creation of innovative products or services for importing innovations to the production process and commercialization of prototype products and services.
(xxxiii) Investment plans which aim to the upgrading of quality of the manufactured products or services.
(xxxiv) Investment plans for acquiring and installing new modern automation systems of processes and computerization of storage places including the necessary software for establishing, expanding and/or developing in the area of industrial units, in the context of modernization of the supply chain.
(xxxv) Investment plans for the establishment or expansion of industrial or arts and crafts units for the alternative management of packaging and other products which have been used up in Greece, for the production of raw materials and other substances.

CATEGORY 5

(i) Investment plans for the realization of a complete long term (2-5 years) investment plan by enterprises (which have been incorporated for at least five (5) years) relating to processing and mining projects of a minimum total cost of 3.000.000 EURO and projects for software development of a minimum total cost of 1.500.000 EURO, including the technological, administrative, organizational and business modernization and? development as well as the necessary deeds for the training of the employees, having one or more of the following objectives:
• Reinforcement of their competitive position in the global market.
• Production and promotion of renowned products and/or services.
• Verticalisation of production / development of complete product systems / services or supplemental products and services.
• Production of products and/or services significantly or totally differentiated from the existing basic products or services of the enterprise.
• Relocation of production / research activities to Greece from abroad.
• Production of products / services by the cooperation of non similar enterprises (preferably from different sectors) having as objective the production of significantly or totally differentiated products and/or services from the existing products or services of the said enterprises.

Establishment of a LTD Company in Greece

A Limited Liability Company called in Greek Law "etairia periorismenis efthinis (E.P.E.) (Mainly Law 3190/1955, Presidential Decree 419/1986) has the features of a partnership and a corporation. It constitutes a convenient form of organization for both small and medium-size enterprises. The liability of the participants is limited to the amount of their contribution.

Establishment

An EPE may be formed by one, two or more natural persons or legal entities, however a natural person or legal entity, may not be a single-partner of more than one EPE. The structure and operation of the EPE is ruled by the Articles of Association (Statute) which must be executed before a notary public, constitutes a registered public document and must state the following:

• Founders/shareholders: full name, profession, domicile and nationality.
• The company name: the company name of the EPE must either be formed by the name of one or more of its shareholders or by the business object and in all cases must include the additional designation "Limited Liability Company".
• The registered office: must be established within the area of a Greek municipality or community.
• The object of the company: i.e. the kind of business that it will conduct. A Limited Liability Company may not carry on business that according to the law is conducted only by another type of company, i.e. banking and insurance business is provided by companies in the form of S.A. only.
• The equity capital: the minimum required equity capital amounts today to Euros 18,000 paid in full, either in cash or other assets as long as it is an asset viewable in the Balance Sheet. However, at least 50% of the capital must be paid in cash. If assets are contributed, their value must be officially appraised by a special committee according to the provision of Art. 9 of Law No. 2190/1920. The company's capital is represented by company shares of a nominal value of Euros 30 or multiples thereof. The shares of a Limited Liability Company are not negotiable instruments, in principle they are freely transferable and inheritable. The company's capital should be fully paid upon the signing of the Articles of Association. If the partners are not Greek nations, natural persons or legal entities then, it must be certified with a "pink slip" issued by a bank, that the amount corresponding to the contribution of the partners, has been officially imported into Greece, prior to the deed of formation of the company.
• The duration of the company: The company is formed for a fixed period, as stipulated in the statute.
• The contribution of each founder.

Registration and Publication Procedures

• Within one month after the signing of the notary deed containing the Articles of Association, the company is registered in the Companies' Registry of the local First Instance Court (where the company's registered office is located). The competent Secretary registers the agreement in the Limited Liability Companies Registrar.
• An announcement of the registration and a summary of the deed containing the names of the partners, the company name, the registered office, the object of the company and the capital, the way of representation of the company etc. must be published, under the supervision of the partners or the managers, in the Government Gazette, "Bulletin of Corporations and Limited Liability Companies". The company acquires legal personality, only after completion of the above-mentioned procedure and the publication date of the Gazette is deemed as the date of incorporation of the company.
• Upon establishment, the company is required to register with the Tax Office and procure accounting and company books stamped by the Tax Authorities and also register with the Local Chamber of Commerce.

Operational Structure

A Limited Liability Company operates on the basis of the Partners Meeting and the Administrator.

a) Partners Meeting Major corporate issues may only be decided at a meeting of partners, which is characterized by the law as the "supreme corpus" of the company. These include amendments to the articles of association, the appointment or removal of administrators, the approval of the balance sheet, the distribution of profits, the commencement of legal proceedings against the administrators of the company or its members and the extension of its duration, amalgamation or dissolution of the company. Each partner has at least one vote at the meeting. If a partner holds more than one share, the number of his votes is equal to the number of his shares. A meeting of the partners must be convened at least once every year and within three months following the completion of the company's accounting period. The resolutions to be adopted at the meetings are generally passed with a majority of more than one half of the partners representing more than one half of the total capital of the company. However, a resolution involving an amendment to the articles of association, including the increase or decrease of the capital (which should take place in the presence of a notary public), requires a majority of at least three quarters of the partners representing at least three quarters of the company's articles of association. Notice: Limited by Shares companies may be transformed into a Limited Liability company.

b) Administrator The management of a limited liability company may be entrusted under the articles of association or by a resolution adopted at partners meeting, to one or more administrators who may or may not be partners. This type of company does not have a board of directors.

Cost of Establishment of a Limited Liability Company (EPE)

Currently, the cost is determined by the following factors:

• Capital concentration fee: 1% of the equity capital.
• Lawyers' Social Funds: (5.80 + 0.30%)
• Government Gazette fee: Euros 290.
• Registration with the Chamber of Commerce (Euros 30 for prevalidation and Euros 372 for registration).

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