3. Legal Regime
Transparency of the Regulatory System
As an EU member, Greece is required to have transparent policies and laws for fostering competition. However, foreign companies generally consider the complexity of government regulations and procedures and their inconsistent implementation to be a significant impediment to investing and operating in Greece. Occasionally, foreign companies report cases where there are multiple laws governing the same issue, resulting in confusion over which law is applicable. Under its bailout programs, the Greek government committed to widespread reforms to simplify the legal framework for investment, including eliminating purely bureaucratic obstacles, redundancies, and undue regulations.
Proposed laws and regulations are published in draft form for public comment before Parliament takes up consideration of the legislation. The laws in force are accessible on a unified website managed by the government and printed in an official gazette. Greece introduced International Financial Reporting Standards for listed companies in 2005 in accordance with EU directives. These rules improved the transparency and accountability of publicly traded companies.
While foreign firms are not subject to discrimination in taxation, numerous changes to tax laws and regulations since the beginning of the economic crisis have injected uncertainty into Greece’s tax regime. As part of Greece’s August 2015 bailout agreement, the government converted the Ministry of Finance’s Directorate-General for Public Revenue into a fully independent tax agency effective January 2017, with a broad mandate to increase collection and develop further reforms to the tax code aimed at reducing evasion and increasing the coverage of the Greek tax regime.
International Regulatory Considerations
Citizens of other EU member state countries may work freely in Greece. Citizens of non-EU countries may work in Greece after receiving residence and work permits. There are no discriminatory or preferential export/import policies affecting foreign investors, as EU regulations govern import and export policy, and increasingly, many other aspects of investment policy in Greece.
Greece has been a World Trade Organization (WTO) member since January 1, 1995, and a member of the General Agreement on Tariffs and Trade (GATT) since March 1, 1950. Greece complies with WTO Trade-Related Investment Measures (TRIMs) requirements. There are no performance requirements for establishing, maintaining, or expanding an investment. Performance requirements may come into play, however, when an investor wants to take advantage of certain investment incentives offered by the government. Greece has not enacted measures that are inconsistent with TRIMs requirements, and the Embassy is not aware of any measures alleged to violate Greece’s WTO TRIMs obligations. Trade policy falls within the competence and jurisdiction of the European Commission Directorate General for Trade and is generally not subject to regulation by member state national authorities.
Legal System and Judicial Independence
Although Greece has an independent judiciary, the court system is an extremely time-consuming and unwieldy means for enforcing property and contractual rights. According to the “Enforcing Contracts Indicator” of the World Bank’s ‘Doing Business 2020” Index, Greece ranks 146 among 190 countries in terms of the speed of delivery of justice, requiring 1,711 days (more than four years) on average to resolve a dispute, compared to the OECD high-income countries’ average of 590 days.
The government has committed, as part of its three bailout packages, to reforms intended to expedite the processing of commercial cases through the court system. In July 2015, the government adopted significant reforms to the Code of Civil Procedure (Law 4335/2015). These reforms aimed to accelerate judicial proceedings in support of contract enforcement and investment climate stability, entering into force in January 2016. Foreign companies report, however, that Greek courts do not consistently provide fast and effective recourse. Problems with judicial corruption reportedly still exist. Commercial and contractual laws accord with international norms, and the judicial system remains independent of the executive branch.
Laws and Regulations on Foreign Direct Investment
In 2019, two new laws were introduced aiming to boost investments in Greece by third-country nationals:
-Law 4605/2019 expands the types of investments that qualify an individual for a residence permit, allowing investments in intangible assets. In particular, capital contribution of at least €400,000 in a real estate investment company, in a company registered in Greece, in a purchase of state bonds, corporate bonds, or shares, in a venture capital investment company, or in mutual funds, allows the investor and his or her family members a five-year residency permit in Greece.
-Law 4608/2019 for strategic investments was approved in April 2019, creating a favorable investment climate by providing various privileges to investors such as tax exemptions and fast track licensing.
Investments in Greece operate under two main laws: the new Investment Law (4399/2016) that addresses small-scale investments and Law 4146/2013 that addresses strategic investments. In particular:
– Law 4399/2016, entitled “Statutory framework to the establishment of Private Investments Aid Schemes for the regional and economic development of the country” was passed in June 2016. Its key objectives include the creation of new jobs, the reindustrialization of the country, and the attraction of FDI. The law provides aids (as incentives) for companies that invest from €50,000 (Social Cooperative Companies) up to €500,000 (large sized companies) as well as tax breaks. The Greek government provides funds to cover part of the eligible expenses of the investment plan; the amount of the subsidy is determined based on the region and the business size. Qualified companies are exempt from paying income tax on their pre-tax profits for all their activities. There is a fixed corporate income tax rate and fast licensing procedures. Eligible economic activities are manufacturing, shipbuilding, transportation/infrastructure, tourism, and energy. More about this law can be found here: .
– Law 4146/2013, entitled the “Creation of a Business-Friendly Environment for Strategic and Private Investments” is the other primary investment incentive law currently in force. The law aims to modernize and improve the institutional framework for private investments, raise liquidity, accelerate investment procedures, and increase transparency. It seeks to provide an efficient institutional framework for all investors and speed the approval processes for pending and approved investment projects. The law created a general directorate for private investments within the Ministry of Development and Investment and reduced the value of investments needed to be considered strategic. The law also provides tax exemptions and incentives to investors and allows foreign nationals from non-EU countries who buy property in Greece worth over €250,000 ($285,000) to obtain five-year renewable residence permits for themselves and their families. In March 2019, the Greek government brought a bill to parliament to expand eligibility criteria of the existing program.
– Law 3908/2011, which provides incentives in the form of tax relief, grants, and allowances on investments, is gradually being phased out by Law 4146 (above).
– Law 3919/2011 aims to liberalize more than 150 currently regulated or closed-shop professions.
– Law 3982/2011 reduced the complexity of the licensing system for manufacturing activities and technical professions and modernized certain qualification and certification requirements to lower barriers to entry.
– Law 4014/2011 simplified the environmental licensing process.
– Law 3894/2010 (also known as fast track) allows Enterprise Greece to expedite licensing procedures for qualifying investments in the following sectors: industry, energy, tourism, transportation, telecommunications, health services, waste management, or high-end technology/innovation. To qualify, investments must meet one of the following conditions:
- exceed €100 million;
- exceed €15 million in the industrial sector, operating in industrial zones;
- exceed €40 million and concurrently create at least 120 new jobs; or
- create 150 new jobs, regardless of the monetary value of the investment.
Other investment laws include:
In October 2019, Parliament passed an economic development bill, Law 4635/2019, aimed at boosting economic recovery in the post-bailout era which entered into force in January 2020. The bill, called “Invest in Greece and other provisions,” simplifies processes for investors regarding environmental and urban planning regulations, speeding up bureaucratic processes. The bill also introduces changes to labor union alterations to encourage job creation and reforms the functioning of the General Commercial Registry.
– Law 3389/2005 introduced the use of public-private partnerships (PPP). This law aimed to facilitate PPPs in the service and construction sectors by creating a market-friendly regulatory environment.
– Law 3426/2005 completed Greece’s harmonization with EU Directive 2003/54/EC and provided for the gradual deregulation of the electricity market. Law 3175/2003 harmonized Greek legislation with the requirements of EU Directive 2003/54/EC on common rules for the internal electricity market. Law 2773/99 initially opened 34% of the Greek energy market, in compliance with EU Directive 96/92 concerning regulation of the internal electricity market.
– Law 3427/2005, which amended Law 89/67, provides special tax treatment for offshore operations of foreign companies established in Greece. Special tax treatment is offered only to operations in countries that comply with OECD tax standards.
– Law 2364/95 and supporting amendments govern investment in the natural gas market in Greece.
– Law 2289/95, which amended Law 468/76, allows private (both foreign and domestic) participation in oil exploration and development.
– Law 2246/94 and supporting amendments opened Greece’s telecommunications market to foreign investment.
– Legislative Decree 2687 of 1953, in conjunction with Article 112 of the Constitution, gives approved foreign “productive investments” (primarily manufacturing and tourism enterprises) property rights, preferential tax treatment, and work permits for foreign managerial and technical staff. The Decree also provides a constitutional guarantee against unilateral changes in the terms of a foreign investor’s agreement with the government, but the guarantee does not cover changes in the tax regime.
Competition and Anti-Trust Laws
Under Articles 101-109 of the Treaty on the Functioning of the EU, the European Commission (EC), together with member state national competition authorities, directly enforces EU competition rules. The EC Directorate-General for Competition carries out this mandate in member states, including Greece. Greece’s competition policy authority rests with the Hellenic Competition Commission, in consultation with the Ministry of Economy. The Hellenic Competition Commission protects the proper functioning of the market and ensures the enforcement of the rules on competition. It acts as an independent authority and has administrative and financial autonomy.
Expropriation and Compensation
Private property may be expropriated for public purposes, but the law requires this be done in a nondiscriminatory manner and with prompt, adequate, and effective compensation. Due process and transparency are mandatory, and investors and lenders receive compensation in accordance with international norms. There have been no expropriation actions involving the real property of foreign investors in recent history, although legal proceedings over expropriation claims initiated, in one instance, over a decade ago, continue to work through the judicial system.
ICSID Convention and New York Convention
Greece is a member of both the International Centre for the Settlement of Investment Disputes (ICSID) and the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York convention).
Investor-State Dispute Settlement
Greece accepts binding international arbitration of investment disputes between foreign investors and the Greek government, and foreign firms have found satisfaction through arbitration. International arbitration and European Court of Justice judgments supersede local court decisions. The judicial system provides for civil court arbitration proceedings for investment and trade disputes. Although an investment agreement could be made subject to a foreign legal jurisdiction, this is not common, particularly if one of the contracting parties is the Greek government. Foreign court judgments are accepted and enforced, albeit slowly, by the local courts.
In an effort to create a more investor-friendly environment, the government established in 2017 an Investor’s Ombudsman service. The Ombudsman is authorized to mediate disputes that arise between investors and the government during the licensing procedure. Investors can employ the Ombudsman, housed within the investment promotiona agency, Enterprise Greece, with projects exceeding €2 million in value. More info on the Ombudsman service can be found here:
International Commercial Arbitration and Foreign Courts
The two main alternative dispute resolution mechanisms in Greece are domestic and international commercial arbitration or mediation. Domestic arbitration is governed under the Code of Civil Procedure (CCP), and mediation is governed under The Mediation Act, Law 3898/2010, modeled after the UNCITRAL Model Law. Greece recognizes foreign judgments under articles 323 and 780 of the CCP and articles 15-21 of Law 3858/2010.
Bankruptcy laws in Greece meet international norms. Under Greek bankruptcy law 3588/2007, private creditors receive compensation after claims from the government and insurance funds have been satisfied. Monetary judgments are usually made in euros unless explicitly stipulated otherwise. Greece has a reliable system of recording security interests in property. According to the World Bank’s 2020 Doing Business Index, resolving insolvency in Greece takes 3.5 years on average and costs nine percent of the debtor’s estate, with the most likely outcome that the company will be sold piecemeal. Recovery rate is 32 cents on the dollar. Greece ranks 72 of 190 economies surveyed for ease of resolving insolvency.
5. Protection of Property Rights
Greek laws extend the protection of property rights to both foreign and Greek nationals, and the legal system protects and facilitates acquisition and disposition of all property rights.
Multiple layers of authority in Greece are involved in the issuance or approval of land use and zoning permits, creating disincentives to real property investment. Secured interests in property are movable and real, recognized and enforced. The concept of mortgage does exist in the market and can be recorded through the banks. The government is working to create a comprehensive electronic land registry which is expected to increase the transparency of real estate management. However, the land registry is behind schedule and is not expected to be completed before 2022. Greece ranks 156 out of 190 countries for Ease of Registering Property in the World Bank’s Doing Business 2020 Index.
Foreign nationals can acquire real estate property in Greece, though they first need to be issued a tax authentication number. However, to acquire sensitive border areas, foreign nationals must first require a license from the Greek state (Law 3978/2011). In another effort to boost investment, the government passed Law 4146/2013, which allows foreign nationals who buy property in Greece worth over €250,000 ($285,000) to obtain a five-year residence permit for themselves and their families. The “Golden Visa” program has been extended to buyers of various types of Greek securities, including stocks, bonds, and bank accounts, with a value of at least €400,000. The permit can be extended indefinitely in five-year increments and allows travel to other EU and Schengen countries without a visa.
Intellectual Property Rights
In April 2020, Greece was removed from the U.S. Trade Representative (USTR) Special 301 Report Watch List due to progress in addressing concerns regarding intellectual property rights (IPR) protection and enforcement. In December 2019, Greece took clear steps to address the long-standing concern of widespread public sector use of unlicensed software by allocating over €39 million for the purchase of software licenses. In addition, the Committee for Notification of Copyright and Related Rights Infringement on the Internet has been taking steps to address enforcement in the online environment, and Greece introduced a new law imposing fines for possessing counterfeit goods. In 2019, the Ministry of Culture developed draft legislation which would allow for the dynamic blocking of infringing domains, which would improve of the enforcement of IPR. The bill is expected to be voted on in 2020.
Greece tracks seizures of counterfeit goods; however, the Ministry of Finance, Coast Guard, and Customs Service all track their data separately. In 2019, the Hellenic Coast Guard arrested 143 people during 110 cases, seizing over 9 million counterfeit cigarettes, 10 vehicles, and over 1,300 pounds of tobacco, which combines for €1.8 million in attempted tax evasion. The Ministry of Finance’s Economic and Financial Crimes Unit (SDOE) conducts investigations and seizures of counterfeit goods. In 2019, the SDOE seized almost 600,000 counterfeit and pirated products, down from 1.1 million in 2018. The Hellenic Customs Service also conducts inspections at exit and entry points into the EU; in 2019 they seized over 20 million counterfeit goods, the majority of which were cigarettes. Violators can be fined for their actions, and Law 3982/2022 provides police ex officio authority to confiscate and destroy counterfeit goods.
Greece is noted in the 2019 Notorious Markets List insofar that ISPs in country were recently ordered to block a number of infringing sites.
Greece is a member of the World Intellectual Property Organization (WIPO) and is party to the Berne Convention, the Paris Convention, the Patent Cooperation Treaty (PCT), the WIPO Copyright Treaty, and the WIPO Performances and Phonograms Treaty, among others. Greece is a member of the European Patent Convention and, as a member of the EU, has harmonized its IP legislation with EU rules and regulations. The World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) was incorporated into Greek law on February 28, 1995 (Law 2290/1995). Greece’s legal framework for copyright protection is found in Law 2121/1993 and Law 2328/1995.
Embassy Point of Contact:
U.S. Embassy Athens
91 Vas. Sofias Avenue, Athens, Greece 10160
A list of local attorneys is available at gr.usembassy.gov/u-s-citizen-services/attorneys/
American-Hellenic Chamber of Commerce
109-111 Messoghion Avenue, Politia Business Center
Athens, Greece 11526
Phone: +30-210-699-3559, Fax: +30-210-698-5686
Greece saw a slight increase in perceptions of corruption, as it went up eight places to 60 on Transparency International’s 2019 Corruption Perception Index, from 67 in 2018. By contrast, the country had improved since 2012, partly due to mandatory structural reforms. Despite these structural improvements, burdensome bureaucracy is reportedly slowing the progress. Transparency International issued a report in 2018 criticizing the government for improper public procurement actions involving Greek government ministers and the recent appointment of the close advisor to the country’s prime minister to be the head of the Hellenic Competition Commission, which oversees the enforcement of anti-trust legislation. Transparency International released another report in October 2018, warning of the corruption risks posed by golden visa programs, mentioning Greece as a top issuer of golden visas.
On March 19, 2015, the government passed Law 4320, which provides for the establishment of a General Secretariat for Combatting Corruption under the authority of a new Minister of State. Under Article 12 of the Law, this entity drafts a national anti-corruption strategy, with an emphasis on coordination between anti-corruption bodies within various ministries and agencies, including the Economic Police, the Financial and Economic Crime Unit (SDOE), the Ministries’ Internal Control Units, and the Health and Welfare Services Inspection Body. Based on Law 4320, two major anti-corruption bodies, the Inspectors-Controllers Body for Public Administration (SEEDD) and the Inspectors-Controllers Body for Public Works (SEDE), were moved under the jurisdiction of the General Secretariat for Combatting Corruption. A Minister of State for combatting corruption was appointed to the cabinet following the January 2015 elections and given oversight of government efforts to combat corruption and economic crimes. The minister drafted coordinated plans of action, monitored their implementation, and was given operational control of the Economic Crime division of the Hellenic Police, the SDOE, ministries’ internal control units, and the Health and Welfare Services’ inspection body. Following the September 2015 national elections, the cabinet post of Minister of State for combatting corruption was abolished, and those duties were assigned to a new alternate minister for combatting corruption in the Ministry of Justice, Transparency, and Human Rights.
Legislation passed on May 11, 2015, provides a wider range of disciplinary penalties against state employees accused of misconduct or breach of duty, while eliminating the immediate suspension of an accused employee prior to the completion of legal proceedings. If found guilty, offenders could be deprived of wages for up to 12 months and forced to relinquish their right to regain a senior post for a period of one to five years. Certain offenders could also be fined from €3,000 to €100,000. The law requires income and asset disclosure by appointed and elected officials, including nonpublic sector employees, such as journalists and heads of state-funded NGOs. Several different agencies are mandated to monitor and verify disclosures, including the General Inspectorate for Public Administration, the police internal affairs bureau, the Piraeus appeals prosecutor, and an independent permanent parliamentary committee. Declarations are made publicly available. The law provides for administrative and criminal sanctions for noncompliance. Penalties range from two to ten years’ imprisonment and fines from €10,000 to €1 million. On August 7, 2019, Parliament passed legislation establishing a unified transparency authority by transferring the powers and responsibilities of public administration inspection services to an independent authority.
Bribery is a criminal act and the law provides severe penalties for infractions, although diligent implementation and haphazard or uneven enforcement of the law remains an issue. Historically, the problem has been most acute in government procurement, as political influence and other considerations are widely believed to play a significant role in the evaluation of bids. Corruption related to the health care system and political party funding are areas of concern, as is the “fragmented” anti-corruption apparatus. NGOs and other observers have expressed concern over perceived high levels of official corruption. Permanent and ad hoc government entities charged with combating corruption are understaffed and underfinanced. There is a widespread perception that there are high levels of corruption in the public sector and tax evasion in the private sector, and many Greeks view corruption as the main obstacle to the economic recovery.
The Ministry of Justice prosecutes cases of bribery and corruption. In cases where politicians are involved, the Greek parliament can conduct investigations and/or lift parliamentary immunity to allow a special court action to proceed against the politician. A December 2014 law does not allow high ranking officials, including the prime minister, ministers, alternate, and deputy ministers, parliament deputies, European Parliament deputies, general and special secretaries, regional governors and vice governors, and mayors and deputy mayors to benefit from more lenient sentences in cases involving official bribes. In 2019, Parliament passed a new amendment to Article 62 of the constitution, which limits parliamentary immunity to acts carried out in the course of parliamentary duties. Under the current constitution, parliamentary immunity applies to all acts conducted while in the office, irrespective if the act is connected to the parliamentary duties. In addition, Parliament amended Article 86 of the constitution, abolishing the statute of limitations for crimes committed by ministers and to disallow postponements for trials of ministers.
Greece is a signatory to the UN Anticorruption Convention.. As a signatory of the OECD Convention on Combating Bribery of Foreign Government Officials and all relevant EU-mandated anti-corruption agreements, the Greek government is committed in principle to penalizing those who commit bribery in Greece or abroad. The OECD Convention has been in effect since 1999. Greek accession to other relevant conventions or treaties: Council of Europe Civil Law Convention on Corruption, Council of Europe Criminal Law Convention on Corruption, and United Nations Convention against Transnational Organized Crime.
Resources to Report Corruption
Organization: The Inspectors-Controllers Body for Public Administration
Address: 60 Sygrou Avenue, 11742, Athens
Telephone number: +30-213-215-8800
Email address: firstname.lastname@example.org
Organization: Transparency International Greece
Address: Solomou 54, 4th floor, 10682 Athens
Telephone number: +30-210-722-4940
Email address: email@example.com