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Establish a Subsidiary in Greece
Updated on Friday 15th September 2023 Rate this article
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Foreign companies have the possibility to establish two types of entities in Greece: branches or subsidiaries. The branches are not considered legal entities and all their major decisions are taken after consulting the foreign company. Unlike it, the subsidiary is a company where the majority of the capital is owned by a foreign company but it is still considered a legal entity. The subsidiaries in Greece are usually formed as limited liability companies and may be private or public. Our Greek company formation experts can help you start doing business in Greece. Anonymous Etaireia, the company limited by shares in Greece, is the most favorable form a major business can take. At least two founders are necessary to establish this type of business and the minimum share capital of 60,000 Euro must be fully paid up at registration. The capital is divided into shares with nominal value going from 0,30 EUR to 100 EUR. The shareholders are liable in the limit of their contribution to the capital.
The management is assured by a board of directors and the major decisions are taken by the general meeting of shareholders.
| Quick Facts | |
|---|---|
| Applicable legislation (home country/foreign country) | Greek commercial law, Greek and EU tax laws. |
| Best used for | Investors can establish a subsidiary in Greece for the following purposes: - expanding on a new market, by incorporating a legal entity that is regulated under the rules of the respective country; - obtaining the tax benefits and other advantages available for local businesses, since the company is Greek based; - separating the parent company from the Greek based company (from a liability/responsibility point of view); - allowing the Greek company to establish its separate management strategy; - limiting the risks of the parent company associated with expansion on new markets. |
| Minimum share capital | The capital for a subsidiary in Greece depends on the legal entity selected by investors (the first 2 are the preferred options by large companies): - public limited company – EUR 60,000; - limited liability company (E.P.E.) – EUR 4,500; - private capital company (I.K.E.) – EUR 1. |
| Time frame for the incorporation (approx.) | 1 week to 1 month (depending on the selected legal entity). |
| Documents to be filed by parent company | In order to establish a subsidiary in Greece, the following documents are necessary: - the articles of association, memorandum or other statutory documents (depending on the legal entity) issued in the home country; - the certificate of registration issued by the Commercial Registry operating in the home country; - personal documentation of the company’s shareholders and directors; - the decision to set up a subsidiary overseas. |
| Management (local/foreign) | Local |
| Legal representative required (Yes/No) | Yes |
| Local bank account (Yes/No) | Yes |
| Independence from the parent company | The subsidiary is an independent structure from its parent company. |
| Liability of the parent company | Limited to the amount of shares owned. |
| Corporate tax rate | 22% |
| Annual accounts filing requirements | Companies in Greece must submit corporate income tax returns, value added tax returns and financial statements. Audit is also necessary provided that the company reaches certain thresholds in terms of assets held, revenue and number of employees. |
| Possibility of hiring local staff (Yes/No) | Yes |
| Travel requirements for incorporating branch/subsidiary | Foreign investors can establish a subsidiary in Greece without personally arriving in the country. They can complete the procedure with the assistance of our team, if they grant the power of attorney. |
| Double tax treaties signed in Greece | 57 |
What is a subsidiary?
When we talk about opening subsidiaries, or branches in Greece, we refer to those organizations that answer to another company. The company to which they answer to is usually called "parent". In most cases, the parent company controls the majority of the shares of the subsidiary company, so it is practically the real decision-maker.
However, the subsidiary usually has a high level of independence. This is because it has no corporate links with the parent company. This occurs because the subsidiary has its own management and control bodies, in addition to its own capital.
The existence of a business operation based on the creation of subsidiaries and affiliates is important when it comes to understanding the existence of large international corporations or holding companies.
Although the parent company often controls more than half of the shares of the subsidiary, it usually delegates control and responsibility for its financial or operational decisions to the subsidiary.
Opening a subsidiary is not an impossible job, but it does require you to be aware of the formalities and authorities you have to deal with. If you want to learn more about the specific characteristics of this type of company, it is best to have access to a team of experts in company formation in Greece.
What is the difference between subsidiaries and branches?
The main difference is that the parent company controls and directs the branches directly, while in the case of the subsidiary, the same occurs as mentioned in the preceding paragraphs.
The only difference between the subsidiary and the affiliate is that in the subsidiary control is not exercised directly by the parent company, while in the affiliate control is direct, without intermediaries. In all other respects it is the same, since in both cases the company must be controlled by another company, so that it does not have autonomy to make decisions.
Knowing which of these two modalities is the best for your objectives is crucial to be successful when starting a new business, so you should carefully study the pros and cons of each one.
If you want detailed information it is always advisable to talk to an expert in company formation in Greece. If you need other services in Greece, such as immigration services (residence permits, obtaining Greek citizenship, etc.), please contact our partners - immigration-greece.com.
Why open a subsidiary company in Greece in 2023?
Opening a subsidiary company in Greece may respond to different reasons that depend on the objectives of each investor. All of them, mainly based on the search for higher business volumes and risk diversification.
This type of legal structure provides a level of versatility that attracts many foreign investors to the idea of opening a Greek company. These are some of the best reasons why more and more entrepreneurs are interested in opening a subsidiary in this Mediterranean country:
- Protect the divisions of your business: a good way to use a subsidiary company is to separate the responsibilities of each of the divisions of your company. This is a good plan to cover yourself against any inconvenience and not to compromise your whole structure.
- It is a cheap way to enter Europe: the prices and costs of operating a business in Greece are lower than in most EU countries. This is one of the most popular reasons to open a Greek company.
- Access to new markets: opening a subsidiary in Greece allows you to take advantage of the benefits of doing business within the EU bloc. It is an ideal export platform.
- Tax optimization: the creation of subsidiary companies allows in many cases to obtain greater tax benefits, especially in terms of tax payments.
Contrary to what one may believe, establishing a subsidiary in Greece is not something reserved only for multinational and economically powerful companies. Small and medium-sized companies can also benefit from having such a platform for exporting goods and services. Opening a company is within the reach of many entrepreneurs.
But even though these types of companies have so many advantages and are within the reach of many entrepreneurs, it does not mean that the process of opening a subsidiary in Greece is a piece of cake. At the very least, you will need to have a thorough understanding of the procedures necessary to successfully go through the process.
If you are trying to better understand the company formation process in Greece, one of the best options you have is to contact experts. Many times the language barrier makes it difficult for foreign entrepreneurs to fully understand how the whole process is to start operating in Greece through a subsidiary.
You can get in touch with a team of incorporation experts to get the help you need with the whole process of setting up a company in Greece.
Subsidiary in Greece, registered as a limited liability company in 2023
Etaireia Periorismenis Efthinis, the limited liability company in Greece is preferred by small and medium-sized companies because the minimum share capital that must be registered is not so high as the one for a company limited by shares. In the past, the founders were required to deposit during the registration of the limited liability company capital of EUR 18,000, divided into shares with a minimum nominal value of 30 EUR. The liability of the members depends on their contribution to the capital. However, in 2022, the company can be registered in Greece with lower capital, of only EUR 4,500, a rule which is also in force in 2023. The advantage of this company type is that it can be used for almost all business activities.
Investors must know that the limited liability company is a legal entity recommended for a small or medium-sized company. If the investors will want to start a large business in Greece in 2023, the public limited company will be the ideal business form, as it is created to fit the needs or large companies.
The law states that, for 2023, this company type can be formed with a capital of EUR 60,000. It is not necessary to subscribe the entire capital in the initial phase of the incorporation, as it can be fully paid in a period of 2 months after the company was incorporated.
The procedure of registering a subsidiary in Greece is quite complex but the processing time is rather short; a subsidiary may start the activities in maximum of 10 days after starting the incorporation process.
First of all, the foreign company must file the registration documents with Athens Bar Association. The name must be unique, so it must be checked at the unique registration office - GEMINET. The registration documents must be deposited here and have as a final result the issuing of the Lawyers Welfare Fund certification, the registration number, and the GEMI number.
The Articles of Incorporation must be published in the Official Gazette so the founder must deliver it to the Printing Office. There are a number of other documents that are required for opening a company as a subsidiary in Greece in 2023; for more details, our experts in company registration in Greece are at your disposal.
The next step in establishing a subsidiary in Greece is registration at the Chamber of Commerce and Industry. The subsidiary must also apply for the company seal and register at the Tax Authorities.
The last step of incorporating a subsidiary is registering the employees at the Manpower Employment Organization, no later than 30 days from the hiring.
Facts and figures about Greece
- - The estimates for the growth of the Greek economy was of 3.7% in 2021
- - The unemployment rate is around 17%, down from almost 30% during the financial crisis
- - Greece had a 60.9 score in the 2021 Index of Economic Freedom, which meant it is considered a moderately free economy for the first time in a decade.
Contact us for more information about our company formation services in Greece.
Meet us in Athens
Federico Richardson is our company formation expert in Greece and the founder of Lexidy Law Boutique SLP.
He can assist clients with the entire company registration procedure in Greece.
He can assist clients with the entire company registration procedure in Greece.
Call us now at +302111995654 to set up an appointment with our lawyers in Athens, Greece. Alternatively you can incorporate your company without traveling to Greece.
As a Lexidy Law Boutique SLP client, you will beneficiate from the joint expertize of local lawyers and international consultants. Together we will be able to offer you the specialized help you require for your business start-up in Greece.
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