GREECE: An Introduction to Dispute Resolution

During the previous year, and particularly over the last few months, the global situation - also affecting Greece - seems to vividly reflect Heraclitus’ perception of life. As the “dark” Greek philosopher said, everything is moving, in the sense that the world is a field of uncertainties and life is always subject to changes. The past year has seen Greece cautiously overcome the COVID-19 health crisis; during the last months, the social distancing measures gradually relaxed and pillar-sectors of the Greek economy, such as tourism and entertainment, started aiming at a fresh restart, which would contribute to the mitigation of the extensive damages suffered during the first pandemic waves. However, to quote Heraclitus “war is the father and king of all”. The war in Ukraine has dramatically overturned any forecast regarding 2022. Although Greece is - of course - not directly affected, the situation in Ukraine already has a domino effect on a global level, also felt by Greece.

Oil prices have skyrocketed since the invasion in Ukraine, leading to a significant increase of the production and supply cost of all goods. The SWIFT ban imposed by the EU to seven Russian banks is expected to lead, according to a Credit Suisse strategic analyst, to missed payments and giant overdrafts, comparable to the consequences of the first wave of the COVID-19 pandemic. Moreover, as a member state of the EU, Greece has also prohibited flights of Russian aircraft from entering the Greek airspace. The relevant prohibition (in the form of a NOTAM) entered into force on February 28th and shall remain in place for the next three months. In view of the above, the number of Russian tourists visiting Greece -at least - this year is going to decrease significantly. It is more than certain that all the aforementioned measures and parameters are going to affect the smooth implementation of contracts not only in the tourist sector, but in every field of the Greek market. The institutes of force majeure, financial inability to perform and overturn of the underlying basis of the contract, as well as the obligation to renegotiate, are going to be re-visited by both courts and tribunals, this time not as a result of the pandemic, but as a result of the war and its more or less direct or indirect consequences. As the COVID-19 pandemic is no longer considered as a “change of the circumstances” (on which the parties have based the conclusion of a contract and the performance of the obligations undertaken therein), the war in Ukraine and its financial impact may establish a new ground justifying contractual adjustment.

In addition to the changes brought by external factors, 2022 is also a year of internal changes for the Greek dispute resolution scene. More specifically:

In October 2021, the Greek Parliament passed Law 4842/2021 on the acceleration of civil trials, the digitalization of the civil procedure and the introduction of a broader range of amendments to the Greek Code of Civil Procedure (the “GCCP”), with effective date the 1st of January, 2022. The amendments introduced by the aforementioned law are the product of reflection on and assessment of the previous extensive reform of the GCCP, which had been introduced by Law 4335/2015 (in force since 01.01.2016) and aim to substantially improve the quality of the Greek justice administration system.

Inspired by the relevant provision of the Greek Code of Administrative Procedure, the new Article 20A of the GCCP introduces the concept of “pilot trials” in civil justice. Pursuant to the provisions of the aforementioned article, the parties to a civil dispute will be able to file a petition or the competent court will be able to issue a preliminary decision, asking a three-member committee of the Supreme Civil and Criminal Court to refer to the Plenary Session any dispute raising a “new complex interpretative legal matter of general interest and repercussions for a wide group of persons”. Alternatively, the Attorney General of the Supreme Civil and Criminal Court will be able to directly refer the matter to the Plenary Session. After the Plenary Session has resolved the matter, the case will be referred back to the lower court, in order for the latter to proceed with issuing a decision on the merits of the particular case. The provision has already been a field of conflict for the legal community, raising serious doubts in two main directions: firstly, as regards the constitutional compatibility of the relevant article, since in the Greek legal order the control of constitutionality is an exercise undertaken by courts of all instances. Moreover, what can also be problematic is the impact the pilot trial might have on ongoing proceedings which raise the same legal issue as the one referred to the Supreme Civil and Criminal Court. It is more than certain that the discussion will be continued even more vividly, once the provision is applied on a concrete case.

On the more central provisions of the Greek Civil Procedure, Law 4842/2021 has brought changes to the deadline for the submission of the pleadings, provided for the ability of the parties to include - under specific conditions - new claims in their rejoinders, given the opportunity for the production of solemn declarations (the admissible number of which has been reduced) before lawyers (except for the parties’ attorneys), accelerated the proceedings for small claims and brought back – at least to an extent – the discretionary power of the court to order the partial allocation of judicial expenses between the parties, in the event of reasonable doubt as to the outcome of the proceedings.

It is common ground that the social distancing imposed by the COVID-19 restrictions pushed the legislature to take bigger steps towards the digitalization of the judicial system. To that end, Law 4842/2021 introduced an additional method of electronic filing for documents without an embedded electronic signature or stamp, via an electronic system of communication, accessible to pre-registered users. Moreover, as regards the electronic service of documents, the recently introduced provision of Article 122A of the GCCP underwent a number of amendments regarding the legal requirements for the service by electronic means. Lastly, on the field of procedural modernization and as a result of the new “habits” brought by the pandemic, Article 36 of Law 4745/2020 provided that in exceptional circumstances, the conferences of Greek courts can be held remotely via technological means that ensure their secrecy, if due to insurmountable obstacles the participation of one or more judges in them is impossible.

The goal of acceleration has been the legislature’s central motive not only with reference to the so-called “classic” civil procedure; new provisions aiming at the same target have also been introduced by Law 4816/2021 on the acceleration of the procedure before administrative courts, providing for an increase of the positions of judges in the regular administrative courts, as well as by Law 4745/2020, regarding the proceedings opened by over-indebted individuals; the latter, i.e. Law 4745/2020, has also expressly established the ne bis in idem in the cases of illicit trade and tax evasion, thereby aligning the Greek legislation with the decision of the European Court of Human Rights of 30.04.2015 in Kapetanios and others v Greece concerning the right to the presumption of innocence and the right not to be tried or punished twice.

However, it is not only the “traditional” civil procedure that is going through drastic changes. The Greek legal framework of international arbitration is also under reform. The reform committee has already submitted a draft bill that has been approved by the Ministry of Justice and is expected to enter into force soon. The new law is expected to reflect the 2006 reform of the UNCITRAL Rules and provide for a modern, business friendly and internationally oriented framework addressing real practice problems and giving commercially balanced and operational solutions. As stated by the committee, new “pioneer” provisions have been suggested, such as the presumption of arbitrability of all disputes, the mere evidentiary character of the written document including the arbitration clause, which opens the door to the new digital era, provisions for the avoidance of “guerilla tactics” by the parties with reference to the appointment of the arbitrators, the acknowledgement of the tribunal’s power to take provisional measures, provisions regarding the disclosure of documents, the extension of the award’s res judicata to preliminary issues covered by the arbitration clause etc. It sounds like a really promising reform, but it remains to be closely evaluated in action, once it enters into force.