Registering a company in Greece: Features and Benefits

Registering a company in Greece: Features and Benefits

Registering a company in Greece is an attractive choice for investors wishing to expand their business to the regions of South Eastern Europe and the Middle East. Greece, as a member of the European Union and the European Monetary Union, ensures the stability of the currency and exchange rate, which is an important factor when deciding whether to incorporate in this country.

Incorporation in Greece is an Important Stage in Business 

Here is a summary of the process.

Stages of registering a company in Greece:

• Name Selection: Choose a unique name for your company.
• Preparation of documents: Draw up the founding documents, including the articles of association.
• Notarization: Get the charter certified by a Greek notary.
• Capital Deposit: If required, deposit the share capital into a bank account.
• Registration with the Tax Authorities: Register with the Tax Authorities to pay taxes.
• Licensing (if necessary): Apply for a license in Greece if your activity requires one.

Investment incentives in Greece.

The Greek government aims to attract investment by providing the following incentives:

• Exemption from taxes: benefits for income taxes
• State support: possibility of obtaining financial support.
• Loan subsidies: support by subsidizing interest on financial loans
• Job creation: subsidies for companies that create new jobs
• Risk Financing: Support in Corporate Risk Management

What should be considered when opening a company in Greece?

• Opportunity to choose the appropriate business structure. The choice of company structure in Greece (for example, limited liability company, joint stock company, etc.) depends on the specific needs of your project and business model.
• Dynamics of the Greek market. Research the Greek market, as well as your specific area of activity, to understand what opportunities and competitive advantages can be provided to you in this market.
• Qualification requirements for specialists in various industries. Make sure your team meets all the necessary eligibility requirements to start a business in Greece. These requirements may be specific to certain industries or areas of activity.
• Compliance standards. Understanding the norms and standards of compliance, both national and international, is an important aspect when registering a company in Greece and its further activities.
• Investment and tax incentives in Greece. A country may provide investment and tax incentives depending on the type of business and where it is located. Review these options and consider them in the context of your project.
• Regulatory environment. Greece complies with EU regulations and provides freedom of movement of capital and income. However, tax laws can be complex, so you may need support for the incorporation process in Greece.

Choosing the form of legal entity for a company in Greece

When choosing the form of legal entity for your company in Greece, it is important to consider various factors such as the size of the business, goals, and plans for development. Here is a brief overview of the main factors that interest foreign investors when opening a company in Greece:

• Minimum authorized capital: no requirements.
• Minimum number of shareholders: minimum 1.
• Corporate tax rate: reduced to 22% from 2021.
• Dividend tax rate: 5%.
• VAT rate: the standard rate is 24%; there are reduced rates of 13%, 6.5%, and 0% depending on the types of goods and services.
• Is an annual meeting required? Yes.
• Is an accounting or annual report required? Yes.
• Are tax incentives available? Yes, including research and development (R&D) incentives.

Business structures available for foreign investors in Greece:

1. Limited liability company (EPE);
2. Public Company (AE): Suitable for large projects and companies that plan to list shares on the stock exchange.
3. Partnership (OE or EE): includes general (OE) and limited (EE) partnerships. Partnerships are suitable for joint ventures and small businesses.
4. New Private Company (IKE): Introduced in 2012, it provides more flexibility for SMEs.
5. Branch: A foreign company may open a branch in Greece to carry out certain activities.

The choice of a specific form of company depends on your goals, business size, and other factors. It is also important to consider tax and legal aspects that may affect your business. It is recommended to consult lawyers to register a company in Greece.

In Greece, it is possible to establish a Limited Liability Company 

With a minimum of one shareholder and one director. These individuals or corporations can be of any nationality. The key features of registering an EPE (Greek LLC) are as follows:

1. Capital Requirement: The minimum investment capital for registering an EPE company in Greece is 4,500 euros. Upon formation, at least 50% of this amount must be paid in cash.
2. Liability: Shareholders in an EPE have limited liability. This means that their liability is restricted to the amount of capital they have invested in the company. Shareholders are not personally responsible for the company's debts beyond their contribution to the authorized capital.
3. Financial Reporting: There are mandatory financial reporting requirements that apply to EPEs, as is typical for most business entities. This includes regular financial statements and tax reporting.
4. Bank Account: It's essential for investors to open a dedicated bank account for the EPE company. Personal bank accounts cannot be used for company transactions. This separation of finances is important for legal and financial clarity.
5. Residence Permit: If one of the directors is not a resident of an EU country, they may be required to obtain a residence permit in Greece. This is a significant consideration for foreign individuals involved in the company's management.

Starting an EPE in Greece provides advantages such as limited liability for shareholders and access to the European Union market. However, it's crucial to comply with local regulations and seek legal advice to navigate the specific requirements and ensure a smooth registration process.

Consider other forms of business presence in Greece

1. 1. A Public Company:
   • Founders: An AE can have a minimum of 1 shareholder and 3 directors. Shareholders can be both individuals and legal entities, including foreign corporations.
   • Share capital: The minimum share capital for an AE is 60 thousand euros. This type of company is usually chosen for large public enterprises.
   • Governance: AE is governed by a general meeting of shareholders appointed by the board of directors.
   • Share Trading: AE shares can be traded or transferred on the local stock exchange.
2. 2. Partnership (general and limited):
   • Founders: Investors can form a general partnership (OE) or a limited partnership (EE). In the case of a full partnership, the participants are jointly and severally liable, while in an EE, the liability is limited.
   • Share capital: The minimum share capital to create a partnership is 1000 euros. Both partnerships can be created by two or more members.
   • Governance: The governance of a partnership depends on its type and the established internal agreements between the participants.
3. 3. Branches and representative offices:
   • Branch: The branch in Greece is not an independent legal entity. It performs the functions of the parent company and is responsible for its obligations to it.

Given these features, the choice of a suitable legal structure depends on the objectives of the investors and the nature of the business they plan to develop in Greece.

Conclusion

From year to year, the inflow of foreign direct investment into Greece is increasing. This process has prompted the local authorities to improve the legislation, which now greatly simplifies the procedure for starting a business in Greece. For detailed information on how to register a business in Greece, please contact IQ Decision UK.