The business-friendly environment of Greece makes it a favorable location for setting up a subsidiary in Greece. The country’s geographical location makes it an instant hub for entrepreneurs and investors. With a significant range of human capital and a strong business foundation, the economy of Greece is improving.
The well-developed communications and logistics make Greece a hotspot for conducting business. As a result, you can expect to process your commercial operations in Greece seamlessly. The country’s geographical location works to its business advantage, making it easy for entrepreneurs to reach markets in the Middle East and Southeastern Europe. Additionally, entrepreneurs in Greece can also get straightforward access to the huge Balkan market.
Greece has an open business climate allowing overseas businesses to open a subsidiary in Greece easily. The favorable government incentives, seamless banking service, and talented workforce allow entrepreneurs to opt for a wholly-owned subsidiary in Greece.
Read this guide to understand how to establish a subsidiary business in Greece.
What are the Types of Subsidiaries in Greece?
Before setting up a subsidiary company in Greece, go through the business entities that are operational here:
Limited liability company
- Requires a minimum capital of EUR 4,500
- Partners are held liable only for their share
- Incorporation takes four days to a week
- Relies on memorandum and article of association
- Has to pay a corporate tax of 22%
Societe Anonyme
- Requires a capital of EUR 60,000
- Can practice any business
- Incorporation takes almost a week.
- The annual general meeting is a must.
- It should contain at least three people in the directorate.
- Subject to corporate tax of 22%
General partnership
- Consists of two accomplices with unlimited obligations
- Can choose the administration in-charge
- No capital is required.
Limited partnership
- Needs two investors
- No base capital is required.
- The limited partner has limited liability for company debts.
- Requires at least one general partner who is in charge of the administration
How to Set Up Subsidiaries in Greece?
The Chamber of Commerce and Industry takes care of setting up a subsidiary in Greece. Here are the steps for subsidiary company formation in Greece:
Step 1: Decide the business entity
- The first and foremost step in setting up a subsidiary system in Greece is choosing the business entity you want to establish.
- The most common legal business entity in Greece is Société anonyme (Anonymi Etairia).
Step 2: Setting the business name and address
- Since this is a subsidiary business in Greece, you can stick to the parent company’s name.
- When choosing a name different from the parent company, select something unique and easy to remember.
- The address of your business entity should be in Greece.
- Once you have chosen a company name, register it in the GEMINET office. After registration, you will get a Lawyers Welfare Fund certificate, the company registration number, and the Greek Business Registry number.
Step 3: Documents certification
- Get all the company registration documents certified by the Athens Bar Association. Ensure to translate all documents in Greek.
- Remember to take the Special Apostille of the Hague Convention for company registration.
Step 4: Receiving Tax Identification Number
- After registering your company with the Greek tax Authorities, apply to the Internal Revenue Services to receive a Tax Identification Number (TIN).
Step 5: Bank account opening
- With the TIN, open a corporate bank account in your company’s name to deposit the capital share.
- Submit all the documents of the shareholders and directors to the bank.
Step 6: Receiving company seal
- Submit all documents to the Chamber of Commerce and Industry. You will get the company seal after registration.
Benefits of Setting Up a Greece Subsidiary
When planning to set up a subsidiary in Greece, you surely want to look into the benefits of a subsidiary company in Greece. Here are the advantages of setting up a company in Greece:
- Reasonable cost of labor
- State-of-art infrastructural facilities
- Potential growth of industries
- Liberal business climate
- Double taxation agreements with some nations
- Suitable investment incentives by the government
- Talented workforce
- Cooperative banking services
Documents to Prepare When Opening a Subsidiary in Greece
The document checklist for incorporation of foreign subsidiary in Greece includes the following:
- Declaration under Article 8 of Law 1599/1986
- Copy of Article of Association
- Memorandum of Association
- Documents of founders who are residents of Greece
- Identity card
- Valid passport
- A solemn declaration to reside in Greece
- Residence permit
- Documents of foreign founders, shareholders, and directors
- Identity card
- Valid passport
- Valid travel document
- Certified copy of the power of attorney
- Company registration form
- Documents describing the company shareholders, directors, and secretary
- Valid passport and residence permit
- Certificate issued by local Chamber or public authority authenticating company’s establishment and operations
What Business Forms can Greece Subsidiaries Take?
As per the government of Greece, foreign investors and entrepreneurs can set up a limited liability company, a limited partnership company, or a general partnership company in Greece. However, the kind of business entity entrepreneurs want to set up depends on their business size and activities.
Of all the business entities, a limited liability company is the most common. Submit al; documents to the public notary regarding the personal information of the company director, shareholder, and director, business activities, the company’s registered address, and capital share. You have to get both these documents notarized in Greece.
Greece Subsidiary Laws
The Greece subsidiary laws, guided by the Greece Company Act, depending on the type of business entity you own. The legal requirements for opening a subsidiary business in Greece are as follows:
- For a public limited company, you need three directors, one shareholder, and a minimum capital of EUR 60,000.
- The private capital company is formed by one founder and at least EUR 1 as minimum capital.
- Business entities must register with the Social Insurance Organization, Greek Tax Authorities, and the Greek Chamber of Commerce and Industry.
- Companies must fill up M3 and M7 forms to get a Tax Identification Number.
Post Incorporation Compliance
Here are the compliances for a foreign subsidiary in Greece after registration:
- Filing article of incorporation
After the incorporation of a wholly owned subsidiary in Greece, you need to file the article of incorporation of the subsidiary along with an official gazette. - Registering employees
Finally, to get all employees to work, you must get all your employees registered under the Manpower Employment Organization. Ensure to do this registration within a month of hiring.
Taxes on Subsidiaries in Greece
For incorporation of foreign subsidiaries in Greece, all companies are taxed based on the earnings they derive from the Greek institution. From 2021, the tax rate for business corporations was lowered to 22%. Even now, businesses pay a tax of 22%. However, credit institutions have to pay a tax of 29%. This tax rate applies only to those subject to Article 27A of the Income Tax Code.
Tax Incentives for Businesses Setting Up a Subsidiary in Greece
The government incentivizes entrepreneurs to attract investors for the incorporation of a foreign subsidiary in Greece. Regarding personal business activities, entrepreneurs are exempted from special solidarity tax and income tax. They get a tax incentive of 50% on their earnings in Greece.
Other Important Considerations
Setting up a subsidiary business in Greece requires considerable money and time. Investing a few weeks to concentrate on expanding your business in the country to comply with the legal obligations is advisable. The arrangement of the whole registration process can take a few weeks to conclude.
Whatever type of entity you establish, you must file the annual VAT return statement and have a record of the monthly VAT accounts.
How Multiplier Can Help You Hire & Expand in Greece
It is essential to have a thorough awareness of the rules and regulations before setting up a subsidiary in Greece. You may work together with international EOR services like Multiplier here. We assist in hiring local personnel without creating a subsidiary. Doing so allows you to establish teams in other nations and test out new marketplaces at an affordable rate.