GREECE: An Introduction to Corporate/Commercial

Economic Conditions, Investment Trends and Developments

The Greek economy has maintained its development dynamic during 2024 outperforming the Eurozone GDP growth average, despite global challenges. Specifically, economic activity continued to grow at a satisfactory pace (2.1% year-on-year in the first half 2024 according to the EC), thanks to a strong performance in tourism, private consumption and investments. It is expected to maintain a generally similar expansion in 2025 and 2026. Greece’s positive performance was also fuelled by the recovery of the investment grade in its credit rating from both S&P and Fitch at the end of 2023 after a 13-year “junk status”.

Reforms in key areas, supported by the implementation of the Recovery and Resilience Plan (RRP), have been the spearhead of this, including digital transformation of the state and the private sector, employment, social cohesion, justice, tax (administration, compliance, policy and the fight against evasion and corruption), green transition and energy saving.

This structural improvement is already being rewarded and the appetite for investments continues to rise, supported also by banks’ increased liquidity and available EU funding. In September 2024, FDI in Greece saw net flows of EUR393.80 million according to the BoG. EY’s Attractiveness Survey Greece 2024 shows that FDI projects in Greece in the last two and three years represent 25% and 33%, respectively, of the investments recorded by the survey since its inception in 2000. The EY European Investment Monitor recorded 50 investment projects for 2023, at a time when investment in Europe fell by 4% in 2024, totalling a 14% drop since 2017, and Greece's positive trend persisted in 2024.

After years of stagnation and mistrust, the Greek IPO market resurged in 2023 and 2024. A total of eight IPOs and listings on the main market of the ATHEX were completed, relating mostly to the real estate, banking and technology sectors in addition to the landmark listing of the Athens International Airport. The Greek state actively participated in transactions spanning from HFSF’s divestment in NBG and Piraeus to the new concession agreement for Attica motorway and the creation of the fifth banking pillar in Greece. In the private sector, considerable M&A activity was observed in 2024 particularly in telecommunications media and technology, energy, construction, and financial services, with the highlight in big-ticket deals probably being, Masdar’s acquisition of 70% of Terna Energy from GEK Terna.

In addition, VC and PE financing are at a rather mature stage. A newly born ecosystem of start-ups has been developed and is being systematically supported, together with SMEs, by the State. In this vein, recent Law 5162/2024 offers tax incentives for R&D by start-ups and further incentives for investment by “angel” investors”. In addition, the law expanded the golden visa programme, until recently primarily linked to real estate investments, to foreign persons who will invest at least EUR250,000 in new equity or bonds issued by Greek start-ups registered in Elevate Greece. Furthermore, the Hellenic Development Bank of Investments continues to invest in funds supporting, among others, start-ups and SMEs, innovation and the green economy having invested in five new funds in 2024, whereas the Hellenic Development Bank has been very active in applying innovative financial instruments, delivered by financial institutions to the SMEs.

ESG

Greece places particular emphasis and is committed to the implementation of the UN 2030 Agenda for Sustainable Development and its 17 Sustainable Development Goals. Seeking to promote the ESG reporting practices, the ATHEX has developed the “ESG Reporting Guide” which principally targets Greek-listed companies but can be a useful tool for non-listed companies.

On the legislative front, the year has been marked by the recent transposition into Greek law of Directive (EU) 2022/2464 (“The Corporate Sustainability Reporting Directive” – CSRD). CSRD makes substantial changes to Directive 2014/95/EU (“Non-Financial Reporting Directive” ‒ NFRD) as it introduces more detailed reporting requirements on sustainability issues. Such obligations will apply to a broader group of large companies (ie, not only to those subject to NFRD), listed SMEs and non-EU companies if they generate over EUR150 million in the EU market.

Besides, Greece will have to transpose Directive (EU) 2024/1760 (the “Corporate Sustainability Due Diligence Directive”) into law by 26 July 2026. The Directive aims to promote sustainable and responsible corporate culture and conduct in company operations, subsidiary operations and global value chains. The new rules will ensure that the companies in scope identify and address adverse human rights and environmental impacts of their actions inside and outside Europe.

Furthermore, in 2024 Greece transposed Article 1 of Directive 2019/1151 on disqualified directors into law by means of Law 5122/2024. The new Law seeks to protect persons when interacting with corporate entities by preventing individuals who have been irrevocably sentenced for a criminal act falling within the ambit of the law, whether in Greece or in another EU member state, from assuming managerial positions in such entities for a substantial amount of time. The purpose of the Law will be achieved through registration of such persons with a Register of Disqualified Directors established in the information systems of the Greek corporate register (GEMI) to which authorities and persons with a legitimate interest will have access.

A broader set of large companies, as well as listed SMEs, will now be required to report on sustainability (also non-EU companies if they generate over EUR150 million in the EU market).

Digital Transformation and AI

Greece’s digital transformation is paramount for achieving sustainable growth. In a continuous effort to battle bureaucracy, the public sector is undergoing a profound digitalisation programme with the goal of getting fully digitised by 2025. This has already significantly improved the environment in which entrepreneurs and legal advisers operate and increased the investment appetite for the Greek technology sector while Greece is seeking to position itself as a regional data and innovation hub.

The EU and national legislative arsenal have recently been enhanced with two major acts of direct application, Regulation (EU) 2022/2554 (the “Digital Operational Resilience Act” – DORA), which will enter into force on 17 January 2025 and Regulation (EU) 2024/1689 (the “AI Act”), which will enter into force on 2 August 2026. For Greece, the AI Act comes after a first attempt of the country to regulate AI and other emerging technologies (eg, blockchain, internet of things, smart contracts, 3D printing, drones) in both the public and the private sector, through Law 4961/2022.

Other Recent Legislative Developments

At the end of 2023, in compliance with Directive (EU) 2019/2121, Greece adopted Law 5055/2023 in order to reform the legislation on cross-border corporate transformations of limited companies. The new Law supplemented the existing provisions by providing for cross-border divisions and conversions as well. Further, the Law systematised the legal framework for corporate (domestic or cross‐border) transformations, by incorporating the applicable rules in a single text, Law 4601/2019.

Furthermore, recently enacted Law 5123/2024 aims to create a single and coherent legislative framework for collateral arrangements in the form of pledges, whether over movable assets (notional pledge), registered securities, receivables or other rights. The new Law includes provisions for the modernisation of certain key aspects of a pledge mainly in relation to creation and enforcement and the establishment of a Single Central Electronic Register of Pledges where all pledge agreements will be registered.