Navigating Corporate Compliance in Greece: A Comprehensive Guide

In the dynamic world of corporate governance, understanding the legal frameworks and compliance requirements is crucial for businesses to thrive while mitigating risks. In this guide, we will delve into the intricacies of establishing and operating different forms of entities, including Societe Anonyme (S.A.), Limited Liability Company (L.T.D.), and Private Company (P.C.), focusing on Greece as our jurisdiction.

Form of Entity: Understanding the Options

In Greece, businesses can opt for various forms of entities, each with its own legal characteristics and compliance obligations.

• Societe Anonyme (S.A.): A company where liability is imposed solely on its assets, not its shareholders. Managed by the general meeting of shareholders and the board of directors.
• Limited Liability Company (L.T.D.): A separate legal entity with shareholder liability limited to company assets. Managed by the partners’ meeting and appointed directors.
• Private Company (P.C.): Similar to an L.T.D., with liability limited to company assets. Managed by the partners’ meeting and appointed directors.

Entity Set Up: Meeting the Minimum Requirements

• S.A.: Can be formed with an unlimited number of shareholders, with a minimum share capital of EUR 25,000.
• L.T.D.: No minimum capital requirement, can be formed with one partner.
• P.C.: No minimum capital requirement, can also be formed with one partner.

Legal Liability: Protecting Stakeholders’ Interests

• S.A.: Shareholders generally not personally liable for company debts, but misuse may lift the corporate veil.
• L.T.D. and P.C.: Shareholders’ liability limited to company assets, with directors potentially liable for overdue tax payments.

Tax Presence: Meeting Tax Obligations

• All entity types taxed on corporate income, with shareholders taxed on distributed dividends.
• Corporate tax rates for the fiscal year 2021 were 22%, with a withholding tax of 5% on dividends.

Incorporation Process: Understanding the Procedures

• S.A.: Can be formed before a notary public with a notarial deed or a private document.
• L.T.D. and P.C.: Incorporated through a notarial deed or private document.

Business Recognition: Establishing Presence

• S.A. and L.T.D. well-regarded and widely used, with P.C. gaining popularity among small and medium enterprises.

Shareholder and Board Meeting Requirements: Ensuring Governance

• Annual meetings required for approval of financial statements and major decisions.

Annual Maintenance and Compliance: Fulfilling Obligations

• Annual financial statements submitted to the General Commercial Registry, along with other required resolutions.

Director and Officer Requirements: Managing Corporate Leadership

• Directors appointed by shareholders or partners, responsible for day-to-day operations and corporate governance.

Exit Strategy: Dissolution and Liquidation

• Companies can be dissolved by shareholder decision, court order, or insolvency, followed by liquidation proceedings.

Conclusion

Navigating corporate compliance in Greece requires a comprehensive understanding of legal requirements and adherence to regulatory frameworks. By ensuring compliance with entity-specific obligations, businesses can operate effectively while safeguarding stakeholders’ interests. Understanding the nuances of corporate governance is essential for successful business operations in Greece’s dynamic business landscape.