Company formation or business establishment in Greece is subject to specific regulations and requirements, which also apply when founding a subsidiary of German companies in Greece. For this reason, Kosmidis & Partner would like to offer you an overview of the necessary steps you will encounter during a company formation in Greece. We would be happy to advise and support you in all further legal matters concerning the establishment of your subsidiary in Greece.
5 Steps to Company Formation in Greece
When establishing Greek subsidiaries of foreign companies or investors, the EPE form is often chosen; however, since the introduction of the IKE form into Greek law, this also represents an attractive corporate form. Here, the foreign parent company usually acts as a partner. The following overview outlines the steps for establishing an IKE in Greece, but is limited to the essential points and does not claim to be exhaustive.
A new formation system has been in effect in Greece since April 2011; since the IKE form was only introduced in 2012, this corporate form must be founded exclusively through this system. An IKE can be founded quickly and easily either online through a notary residing in Greece, or by submitting all documents to the KEP (Citizen Service Institution) authority. All required documents are submitted either to the notary or the KEP. All other necessary steps, which are described in detail below, are also carried out at the notary’s office or the KEP, who, for example, arranges for the issuance or sending of required certificates to all affected authorities.
1. Draft of the Articles of Association
The procedure for founding an IKE in Greece begins with the creation of the draft Articles of Association, which are often prepared by the lawyer and submitted to the notary or the KEP. The Articles of Association of the IKE represent the legal document concerning the foundation of the company and the business establishment, but also lay down all fundamental issues related to the company. It can be either private written or notarially certified. In the latter case, the formation must only be carried out by a notary. The minimum required information in the Articles of Association of a Greek IKE is stipulated by Article 50 of Law N. 4072/2012:
- Name, address, and, if applicable, email address of the partners
- Company name of the company / corporate name
- Seat and purpose of the company (a city or municipality within the Greek territory can be determined as the seat)
- Nature of the company as a Private Capital Company (IKE)
- Share capital, as well as the contributions of the partners, and the number of partner shares
- Object and value of the contributions in kind and name(s) of the contributor(s) · Management and representation
- Duration
2. Preliminary Approval of the Company Name
After the name and designation of the new company have been chosen, and the purpose and form are known, the competent Chamber of Commerce and Industry checks whether the name and designation have not already been assigned to another company and comply with the legal requirements. If the chosen name is already in use or does not comply with the legal requirements, a new name must be chosen by adjusting the Articles of Association.
3. Formation – Publication
Specifically during the company formation, the Capital Accumulation Tax (FKS) is paid by the notary or KEP, provided the company is founded with a capital of more than 1 €. This tax amounts to 1% of the company’s capital (Articles 17 – 31, Law N. 1676/86). Furthermore, the publication fees for the subsequent publication of the company in the Commercial Register must be deposited with the notary or KEP, as well as the advance payment for the social insurance costs for the managing director and the partners. Under certain circumstances, these may be exempt from social insurance if, for example, they are already insured in another European state.
All formation costs are paid to the notary or KEP, who then forwards them to the competent funds and sends the Articles of Association and the attached documents to the Commercial Register. With the publication, the company automatically receives a commercial register number and a tax number.
4. Tax Authority
Within 1 month from the date of publication of the company formation, the necessary steps must be taken or documents submitted to notify the tax authority at the company’s seat of the commencement of business (see Tax Number and Business Activity in Greece). Subsequently, the process for the approval of the books and tax-relevant documents must be completed.
5. Industry and Trade Chamber
The company must be registered with the local Industry and Trade Chamber within two months of its foundation. Information on the documents to be submitted, which vary from chamber to chamber, must be obtained from the respective competent chamber.
The law firm Kosmidis & Partner supports you in all legal matters concerning the establishment of an IKE in Greece. We would be happy to advise you on all legal issues. We look forward to your inquiry.
(Status: January 2013. All information is subject to change and without guarantee.)