Insolvency offences are offences connected with the insolvency proceedings of a company or a natural person.
Insolvency exists where the debtor is generally no longer able to settle their due liabilities; for capital companies, over-indebtedness can additionally lead to insolvency.
The former regime under Law 3588/2007 (the Bankruptcy Code) was replaced by the new Insolvency Code – Law 4738/2020, “Settlement of Debts and Grant of a Second Chance” – which has applied to legal entities since 1 March 2021 and to natural persons since 1 June 2021, and has since been amended several times, most recently by Laws 5072/2023 and 5193/2025.
The core provision is Art. 106 of the Insolvency Code (fraudulent bankruptcy, “Chreokopia”). Under this, a person is criminally liable who, during the “suspect period” or within six months before or after the opening of insolvency proceedings, in particular
• removes or conceals assets that would form part of the insolvency estate,
• enters into loss-making transactions contrary to the principles of proper business management (e.g. sham transfers of land to relatives),
• acquires goods on credit and resells them significantly below value,
• acknowledges fictitious claims,
• breaches the statutory bookkeeping obligation or removes, conceals, or destroys commercial books, or
• otherwise reduces the assets to the detriment of creditors, or conceals the true state of the business.
Sentencing range: imprisonment of at least two years and a fine. Insolvency administrators who embezzle assets of the insolvency estate or make false statements in their report are additionally liable for embezzlement or fraud. For insolvent legal entities, criminal liability falls on the managing directors and the members and chairman of the board of directors.
An important innovation is Art. 198A of the Insolvency Code: upon the court’s opening of insolvency proceedings, or upon registration in the electronic solvency register (ΗΜΦ), criminal prosecution of certain insolvency-related offences – in particular for non-payment of debts – is suspended by operation of law, and enforcement of any sentence already imposed is deferred.
FAQ
Insolvency offences comprise offences connected with the insolvency proceedings of a company or a natural person.
Where a company (or a natural person) is no longer able to pay its liabilities, insolvency exists. Capital companies can additionally become insolvent through over-indebtedness – that is, where the registered share capital is no longer represented by assets, or liabilities exceed assets.
Under the now-repealed Law 3588/2007, eight insolvency offences were provided for, the underlying conduct of which remains, in substance, punishable under current law as well:
- removing components of the debtor's assets that would form part of the insolvency estate in the event insolvency proceedings are opened (e.g. concealing goods at an unknown location);
- entering into loss-making transactions (e.g. sham transfers of land ownership to relatives of the debtor);
- acquiring goods on credit and selling those goods significantly below their value;
- acknowledging fabricated rights;
- failing to comply with the statutory bookkeeping obligation;
- removing, concealing, or destroying commercial books;
- the debtor's failure to draw up a balance sheet of their assets or an inventory;
- otherwise reducing the debtor's asset position (e.g. a parent's gift of land to the debtor's children) or the debtor's concealment of their true business affairs.
The practically most significant catch-all offence outside formal insolvency proceedings today is Art. 397 of the Criminal Code (Καταδολίευση δανειστών, defrauding creditors): a debtor who intentionally wholly or partly frustrates the satisfaction of their creditor by damaging, destroying, devaluing, concealing, or disposing of assets without equivalent consideration, or who constructs fictitious debts or sham transactions, is punished with imprisonment of up to two years or a fine. Where the pecuniary damage caused to the creditor is particularly high, the minimum sentence increases to two years' imprisonment plus a fine. Criminal prosecution generally requires a criminal complaint from the injured party.
Within formal insolvency proceedings, the Insolvency Code (Law 4738/2020) additionally regulates its own offences and liability provisions for debtors, managing directors, and insolvency administrators.
An insolvency administrator who embezzles money or property from the insolvency estate, or makes untrue statements in their report, is criminally liable under the general provisions on embezzlement or fraud. Additional special offences for breaches of duty by insolvency administrators are set out in the Insolvency Code (Law 4738/2020).
In the insolvency of legal entities, criminal liability generally falls on the legal representatives – that is, the managing directors, or the members and chairman of the board.
As of June 2026. All information on these pages is provided without guarantee or liability.