Bahas Gramatidis & Partners
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Under Greek law corporate entities may be divided into two categories, that is personal companies and capital companies. The former category includes unlimited, limited or civil partnerships, while the latter embraces limited liability companies and corporations (sociétés anonymes). Other corporate entities include branches of foreign corporations, offshore branches of foreign corporations under Law 89/67 and joint ventures.
General partnership (which is not synonymous with unlimited partnership) is governed by Articles 18-22, 24, 39 and 41-44 of the Commercial Code and Articles 741-784 of the Civil Code. Most of the provisions applicable to general partnerships apply to limited partnerships as well. The main characteristic which differentiates the latter from the former is that in limited partnerships there exists one or more limited partners who are liable only to the extent of their contribution. There are no minimum capital requirements or requirements for the publication of the accounts of personal companies.
Limited partnerships are established by means of a private agreement called the 'partnership contract' which takes the form of either a private instrument or public deed between two of more persons, being the Articles of Association. Once the partnership contact has been executed, it must be registered (or a summary thereof) by the Register of the competent Court of First Instance in the Book of Partnerships. Subsequently the partnership contract is presented to the public for three months in the main court room of the aforementioned court. Any amendments made are also subject to the same publication procedure.
Capital companies corporations
Corporations are governed by Law 2190/1920 on companies limited by shares (AE), as subsequently amended. This law has been recently amended by Presidential Decrees 409/1986, 498/1987 and 350/1993 with a view to harmonising Greek law with the respective EU Directives. It must be noted that since 1986 Greece has adopted the Directives of the Council of the EU 68/151/9.3.1968 and 77/91/13.7.1983 for the harmonisation of the rules relating to the establishment and operation of corporations and limited liability companies in the EU.
A corporation may be founded by at least two natural or legal persons, called 'the founders', by means of a notarial deed, being the Articles of Association. The minimum share capital is Drs10m, for a capital investment corporation Drs30m, for an insurance corporation Drs25m, for a leasing corporation the minimum capital required is the same as for a banking corporation.
Limited liability companies
Limited liability companies are governed by Law 3190/1955, as amended by Presidential Decrees 419/1986 and 279/1993 for the harmonisation of Greek law with the aforementioned Union Directives. Such companies may be formed by one or more natural or legal persons, called the founders, by means of a notarial deed being their charter. The law specifies the minimum contents of the charter of a limited liability company (Article 6 of Law 3190/1920), while the minimum capital requirement is Drs3m.
Under Greek law joint ventures are recognised as constituting a separate legal entity. Although no approval or formality is required for the formation of a joint venture, the participants must enter into a written agreement which must be subsequently filed with the competent tax office. Each participant is taxed according to its participation percentage.
Branches of foreign corporations
Branch offices of foreign companies may be established provided that their share capital is at least equal to the minimum capital required for the respective type of company by Greek law; and a reciprocity agreement exists between Greece and the country of incorporation of the foreign corporation.
This legal form is particularly attractive for foreign companies engaged in construction or in the sale of goods or services.
Such branches of foreign commercial, industrial, shipping and engineering companies may be established in Greece by decision of the Minister of National Economy or by joint decision of the competent Ministries. These branches enjoy full exemption from corporate income tax, import duties, stamp duties, value added tax and indirect taxes. Moreover, they enjoy unlimited freedom in foreign exchange transactions and may employ any number of employees for an unlimited period of time.
The context of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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