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, the corporate form of a limited liability company (GmbH), Greek EPE, is often chosen. Here, the foreign parent company usually acts as a partner. The following overview outlines the steps for establishing a GmbH in Greece, but is limited to the essential points and does not claim to be exhaustive.
Since April 2011, a new formation system has been introduced, according to which a GmbH is founded online by a notary residing in Greece. All necessary documents are submitted to the notary, who uploads them via the online system. All other necessary steps, which are described in detail below, are also carried out at the notary’s office, 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 a GmbH in Greece begins with the creation of the draft Articles of Association, which are often prepared by the lawyer and submitted to the notary. The Articles of Association of the limited liability company 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. The minimum required information in the Articles of Association of a Greek GmbH is stipulated by Article 6 of Law N. 3190/1955:
- Name, occupation, address, and nationality 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 limited liability company
- Share capital, company share, and any multiple shares of the founders, as well as their confirmation of the capital payment
- Object and value of the contributions in kind and name(s) of the contributor(s)
- Duration of the company
Furthermore, the Articles of Association of the GmbH usually stipulate provisions regarding the management, representation, control, etc. of the company, and agreements are made on additional contribution obligations, other services that do not constitute cash or non-cash contributions, non-competition clauses, transfer of company shares, withdrawal of partners, dissolution of the company, etc.
Note: Since December 12, 2012, the minimum required capital for founding a GmbH in Greece is 2,400.00 EURO.
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 notary submits an application to the competent Chamber of Commerce and Industry to ensure that the name and designation have not already been assigned to another GmbH and comply with the legal requirements (Article 2, Law N. 3190/1955). 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. Foundation – Publication
Specifically during the company formation, the Capital Accumulation Tax (FKS) is paid by the notary. This tax amounts to 1% of the company’s capital (Articles 17 – 31, Law N. 1676/86). For the payment of the FKS, the notary uploads two copies of the Articles of Association (one of which is the copy stamped by the Chamber), a check for the prescribed amount, and a declaration for the FKS in duplicate to the system. The proof of payment and one of the two FKS declarations are returned with the Articles of Association. Furthermore, the publication fees for the subsequent publication of the company in the Commercial Register must be deposited with the notary, 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, who 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 a GmbH 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.)