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Establish a Branch in Greece

Updated on Wednesday 21st July 2021

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Establish-a-Branch-in-Greece.pngThe law on setting up a branch in Greece is given by the Article 50 Law 2190/20, Article 57-58 Law 3190/55 and the Presidential Decree 360/93 of the Greek legislationour team of consultants in company registration in Greece can help you prepare the registration file necessary for branch registration; you can also receive tax assistance regarding your tax obligations appearing from the activities of a branch.
 

Register a Greek branch office in 2021 

 

A permit must be received before registration of a branch in Greece from the Industry, Commerce and Natural Resources Department (Prefectures Government). The applicant must deposit the following documents in order to receive it: an application, the certificate of registration of the foreign company, a certificate proving the share capital of the foreign company, a criminal report extract, the decision of opening a branch.
 
It is also required to provide the foreign company’s address, the notary act of appointment of the branch’s representative, proofs of fee payments (payments to the Public Fund Duplicate and the Fund of National Printing Office Employees), a residence permit for the representative of the branch and a work permit if the representative is not from GreeceEven though is not considered a legal entity, a branch must be registered before starting any commercial activities.
 
In order to do that, the following documents must be submitted to the General Secretariat of Commerce: the decision of opening a branch in Greece, the articles and the memorandum of association of the foreign company, the certificate where the share capital of the foreign company is stated, a certificate which proves that the foreign company is not in the process of liquidation and the act of appointment of an authorized representative of the branch.
 
One must also add the proof of identification of the legal signatories of the foreign company, the proof of tax payment for the publication in the Government Gazette, the branch name and its registered address and jurisdiction of the foreign company. If the foreign company is not from an EU country member, the work permits and the residents’ permits must be submitted.
 
For the documents that we have presented above, the certification of a public notary in Greece is necessary; also, they must also have an official, certified translation into Greek, in the case in which the original papers are in another language. Every change in the branch’s or the foreign company’s status must be reported to the Prefecture. Also, a report regarding its operations must be issued every year.
 
The balance sheet of the foreign company must be deposited every year along with the taxation statement of the branch at the competent Greek authorities. Also, the branches established in Greece must pay VAT and taxes on profits that’s why it’s mandatory to register with the tax authorities after receiving the certificate of registration from the Chamber of Commerce and Industry of Greece.
 

What are the tax obligations for Greek branches?

 
Given that when setting up a company in Greece as a branch office investors want to obtain a profit from their activity, the company will be liable to a set of corporate taxes that are charged to all commercial companies operating in this country, regardless of their tax residence. 
 
One of the taxes that a branch office is liable to is the corporate tax, which is charged at the same tax rate applicable under the Greek tax law. However, this tax will be imposed only for the income obtained in Greece, not on the global income of the parent company. This is given by the fact that the branch office is considered a sub-division of the parent company, operating in this country as a permanent establishment. 
 
Foreign companies that will set up a business in Greece can also benefit from the provisions of the double tax treaties that were signed by the Greek authorities with other partner countries, as long as the foreign company is a tax resident of any of such countries. Our team of consultants in company registration in Greece can present the current list of double tax treaties applicable here. 
 
This is an important aspect, as such documents will present various tax deductions that foreign companies can be entitled to and if certain taxes are applicable, they also regulate which type of entity operating in Greece is required to pay the respective taxes. For instance, one of the taxes applicable under double tax treaties is the withholding tax.
 
As a general rule, the withholding tax is charged at a rate of 10%, and it is imposed to local businesses that pay dividends or remit profits to their foreign parent company abroad. However, this tax is not charged to branch offices. Special tax regimes can apply to foreign companies operating in the shipping industry, that will set up a branch in Greece
 
If you want to open a Greek company and you represent a foreign company operating in the shipping industry you must analyze the regulations prescribed by the Law 27/75, which stipulates which are the beneficial conditions. However, legal advice on this matter can also be received by our consultants in company formation in Greece.
 
Companies liable to taxation in Greece must also meet with a set of accounting requirements. They must maintain financial documents in accordance with the law and they also need to conduct an audit, where needed. The audit is also applicable to Greek branches set up by foreign companies, as long as the respective foreign companies operate in the banking industry.
 
This means that if a foreign commercial bank operates in Greece through a branch office, the audit is necessary, and the procedure has to be conducted by a certified auditor, certified in Greece. Please refer to our specialists, who can help you open a company in Greece and present all the accounting requirements your branch should respect, as per the applicable law.  
 

What is the value of foreign investments in Greece?

 
Considering that the branch office is a type of entity that is selected for incorporation by foreign companies, we have decided to present a short list regarding foreign investments in this country, so that those who will open a Greek company can have a better image on the country’s main investors and investment values: 
 
  • the value of the foreign direct investment (FDI) inward flow increased from $3,973 million in 2017 to $4,631 million in 2018;
  • the FDI stock also increased from 2017 to 2018 from $34,853 million to $40,513 million respectively;
  • Greece was also the recipient of greenfield investments which, from 2017 to 2018 decreased on the total number (from 43 to 34), but which increased in value (from $981 million to $1,841 million);
  • the main foreign investors in Greece are all from EU countries, and the top 3 is represented by Germany (26,2%), Luxembourg (21,7%) and the Netherlands (15,6%);
  • foreign investors prefer to invest in the manufacturing sector in Greece (accounting for 26,2% of all foreign investments in 2018), and in the information and technology industry (17%).

 

If you want to find out other key elements of the Greek economy, you can always check the statistics publications issued by the Hellenic Statistical Authority, where you can find information on economic sectors, foreign and local companies, the Greek economy and society, immigration and others. 
 
 
In 2021, the rules on the process of company formation in Greece applicable to branch offices have been maintained; thus, there aren’t any new regulations that investors should be aware of. Foreign investors who haven’t had any business relations with Greece or haven’t performed any investment here up until 2021 are advised to request assistance from local specialists, who can guide them in the process of opening a company in Greece as a branch office
 

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