Executive Summary

Greece’s government has steadily increased its positive rhetoric regarding foreign investment since assuming power in 2015. However, the country continues to present a challenging climate for investment, both foreign and domestic. At the end of Q1 2018, public debt reached a high of 179 percent of GDP. The Greek economy ended 2017 with near 1.4 percent growth, after almost a decade of recession. Depressed demand, wage and pension cuts, and high unemployment have led to a considerable rise in the percentage of loans which are non-performing (NPLs), and have undermined the stability of the financial system. Greek banks made progress in 2017 reducing their level of non-performing exposures (NPEs), with NPEs falling to EUR 95.7 billion (43.1 percent of banks’ overall loan books) at the end of December 2017, from a target of EUR 95.9 billion (or 48.5 percent), while also showing improved collections and liquidations. Banks have committed to reduce their stock of NPEs further to EUR 81.5 billion by December 2018.

In August 2015, to prevent national bankruptcy and the country’s potential exit from the Eurozone, Greece and its EU creditors signed a third EUR 86 billion bailout agreement under the auspices of the European Stability Mechanism (ESM). Capital controls were introduced in June 2015 and, although eased considerably since then, are still in place and continue to deter growth in investment activity, both because of transactional difficulties for firms doing international business and broader negative signaling effects.

The current three-year ESM program agreement details fiscal and structural reform obligations Greece must meet in exchange for the disbursement of financing assistance to enable the government to meet its debt obligations. These reforms include enhanced and accelerated privatization of state assets, reduction in government bureaucracy, restructuring of the civil service, improvements to judicial procedures, enhanced tax collection, and new fiscal measures to close the social security system’s deficit. As of April 2018, the government has implemented most of these reforms to the satisfaction of its creditors, and the program is scheduled to conclude in August 2018.

In November 2015, as part of the initial implementation of the August 2015 ESM agreement, Greece recapitalized its four major banks for the third time in five years. Large U.S. and foreign hedge funds participated in a recapitalization of the four major Greek banks. The banking system, saddled with the largest ratio of non-performing loans in the EU, remains constrained in financing the national economy. As a result, businesses, particularly small-and-medium enterprises, still struggle to obtain domestic financing to support operations due to the inflated risk premiums in the sector. In an effort to tackle the issue, and as a requirement of the agreement with the ESM, Greece is establishing a secondary market for NPLs. To date, eleven companies have secured licenses to operate as a debt service provider: Sepal (an Alpha Bank-Aktua joint venture), FPS (a Eurobank subsidiary), Pillarstone, Independent Portfolio Management, B2Kapital, UCI Hellas, Resolute Asset Management, Thea Artemis, PQH, Qquant Master Servicer, and DV01 Asset Management. At least ten more licensees are pending approval by the Bank of Greece. A handful of other companies have submitted applications and are awaiting approval.

In previous years, concerns over economic and political stability within Greece essentially froze most new investment and caused some existing investors to scale down or withdraw entirely from the Greek market. The success in the privatization of Greece’s 14 regional airports, investment in the tourism sector, and the construction of the Trans Adriatic Pipeline (TAP) demonstrated the opportunities that have existed in Greece even during the height of the economic crisis. Greece’s return to economic growth in 2017 and projected growth in 2018 has generated new investor interest in the country. On February 8, 2018, Greece launched a new 7-year bond auction, which achieved a yield of 3.5 percent (against a starting rate of 3.75 percent), and was more than twice oversubscribed, attracting offers of around EUR 7 billion. This was the third attempt to tap international markets since summer 2017. A bond swap took place November 2017 that reached EUR 25.4 billion, and the Greek state issued a new 5-year bond in July 2017, collecting EUR 3 billion with a yield of 4.625 percent. Although Greece is tentatively returning to bond markets, Greece’s public finances continue to remain partly dependent on the country’s international creditors.

Table 1

Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2017 59 of 180 https://www.transparency.org/country/GRC
World Bank’s Doing Business Report “Ease of Doing Business” 2018 67 of 190 http://www.doingbusiness.org/
Global Innovation Index 2017 44 of 127 https://www.globalinnovation
U.S. FDI in partner country (M USD, stock positions) 2016 USD 628 http://www.bea.gov/
World Bank GNI per capita 2016 USD 18,880 http://data.worldbank.org/

Policies Towards Foreign Direct Investment

The Greek government continues to state its desire to increase foreign investment, though the country remains a challenging climate for investment, both foreign and domestic. Despite the most recent EUR 86 billion bailout agreement signed in August 2015 between the Greek government and its international creditors, under the auspices of the ESM, economic uncertainty remains widespread, though sentiment has been broadly improving since 2017.

Numerous additional structural reforms, undertaken as part of the country’s 2015-2018 international bailout program, aim to welcome and facilitate foreign investment, and the government has publicly messaged its dedication to attracting foreign investment. The Trans Adriatic Pipeline (TAP) is one example of the government’s commitment in this area. In November 2015, the Greek government and TAP investors agreed on measures to begin construction in 2016 for the pipeline, and construction is currently underway.

Nevertheless, many structural reforms have created greater challenges to investors and established businesses in Greece. The country has undergone one of the most significant fiscal consolidations in modern history, with broad and deep cuts to public expenditures and significant increases in labor and social security tax rates, which have offset improved labor market competitiveness achieved through significant wage devaluation. Moreover, corruption and burdensome bureaucracy continue to create barriers to market entry for new firms, permitting incumbents to maintain oligopolies in different sectors, and creating scope for arbitrary decisions and rent-seeking by public servants.

Limits on Foreign Control and Right to Private Ownership and Establishment

As a member of the EU and the European Monetary Union (the Eurozone), Greece is required to meet EU and Eurozone investment regulations. Foreign and domestic private entities have the legal right to establish and own businesses in Greece; however, the country places restrictions on foreign equity ownership higher than those imposed on average in the other 17 high-income OECD economies. The government has undertaken EU-mandated reforms in its energy sector, opening much of it up to foreign equity ownership. Restrictions exist on land purchases in border regions and on certain islands because of national security considerations. Foreign investors can buy or sell shares on the Athens Stock Exchange on the same basis as local investors.

Other Investment Policy Reviews

The government has not undergone an investment policy review by the Organization for Economic Cooperation and Development (OECD), the World Trade Organization (WTO), or United Nations Committee on Trade and Development (UNCTAD), or cooperated with any other international institution to produce a public report on the general investment climate. However, in March 2016, the OECD published an economic survey describing the state of the economy and addressing foreign direct investment concerns. The government has sought the OECD’s counsel and technical assistance to carry out select reforms from the recommendations and develop additional reforms in line with the government’s emphasis on the social welfare state.

Business Facilitation

Greece’s business registration entity, GEMI (General Commercial Register), has the basic responsibility for digitizing and automating the registration and monitoring procedures of commercial enterprises. More information about GEMI can be found at http://www.businessportal.gr/home/index_en . The online business registration process is relatively clear, and although foreign companies can use it, the registration steps are currently available only in Greek. In general, a company must register with the business chamber, tax registry, social security, and local municipality. Business creation without a notary can be done for specific cases (small/personal businesses, etc.). For the establishment of larger companies, a notary is mandatory.

The country has investment promotion agencies to facilitate foreign investments. “Enterprise Greece” is the official agency of the Greek state, under the supervision of the Ministry of Economy, Development, and Tourism, charged with promoting investment in Greece, exports from Greece, and with making Greece more attractive as an international business partner. Enterprise Greece provides the full spectrum of services related to international business relationships and domestic business development for the international market. Enterprise Greece offers the complimentary services of an Investor Ombudsman for investment projects exceeding EUR 2,000,000. The Ombudsman is available to assist with specific bureaucratic obstacles, delays, disputes or other difficulties that lead to intractable differences, a deadlock, a standstill, or similar difficulties regarding the investment project.

The General Secretariat for Strategic and Private Investments streamlines the licensing procedure for strategic investments, aiming to make the process easier, smoother, and more attractive to investors.

Greece has adopted the following EU definition regarding micro, small, and medium size enterprises:

  • Micro Enterprises: Fewer than 10 employees and an annual turnover or balance sheet below EUR 2 million.
  • Small Enterprises: Fewer than 50 employees and an annual turnover or balance sheet below EUR 10 million.
  • Medium-Sized Enterprises: Fewer than 250 employees and annual turnover below EUR 50 million or balance sheet below EUR 43 million.

Outward Investment

The Greek government does not have any known outward investment incentive programs. Ongoing capital controls impose restrictions or additional procedures for any entity seeking to remove pre-existing large sums of cash from Greek financial institutions.

Enterprise Greece supports the international expansion of Greek companies. While no incentives are offered, Enterprise Greece has been supportive of Greek companies attending the U.S. Government’s Annual SelectUSA Investment Summit which promotes inbound investment to the United States.

Greece and the United States signed the 1954 Treaty of Friendship, Commerce, and Navigation, which provides certain investment protection, such as acquisition and protection of property and impairment of legally acquired rights or interests.

Greece has Bilateral Investment Treaties (BITs) with:

  1. Albania
  2. Algeria
  3. Argentina*
  4. Armenia
  5. Azerbaijan
  6. Bosnia and Herzegovina
  7. Bulgaria
  8. Chile
  9. China
  10. Congo*
  11. Croatia
  12. Cuba
  13. Cyprus
  14. Czech Republic
  15. Egypt
  16. Estonia
  17. Georgia
  18. Germany
  19. Hungary
  20. India
  21. Iran
  22. Jordan
  23. Kazakhstan*
  24. Korea
  25. Kuwait*
  26. Latvia
  27. Lebanon
  28. Lithuania
  29. Mexico
  30. Moldova
  31. Montenegro
  32. Morocco
  33. Poland
  34. Romania
  35. Russian Federation
  36. Serbia
  37. Slovakia
  38. Slovenia
  39. South Africa
  40. Syrian
  41. Tunisia
  42. Turkey
  43. Ukraine
  44. United Arab Emirates
  45. Uzbekistan
  46. Vietnam

*Signed, but not in force

Bilateral Taxation Treaties

Greece and the United States signed a Treaty for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income in 1950. As an EU member state, Greece does not have a bilateral Free Trade Agreement (FTA) with the United States, but is a party to all U.S.-EU agreements. Greece reached an agreement in substance on November 30, 2014 on the terms of an intergovernmental agreement with the United States to implement the Foreign Account Tax Compliance Act (FATCA), which was signed January 2017.

Transparency of the Regulatory System

As an EU member, Greece is required to have transparent policies and laws for fostering competition. Foreign companies consider the complexity of government regulations and procedures and their inconsistent implementation to be a significant impediment to investing and operating in Greece. Occasionally, foreign companies report cases where there are multiple laws governing the same issue, resulting in confusion over which law is applicable. Under its bailout programs, the Greek government committed to widespread reforms to simplify the legal framework for investment, including eliminating bureaucratic obstacles, redundancies, and undue regulations. The fast track law, passed in December 2010, aimed to simplify the licensing and approval process for strategic investments, i.e. large scale investments that will have a significant impact on the national economy (see paragraph 1.3, Laws/Regulations of FDI). In 2013, Investment Law 4146/2013 was passed in Parliament to simplify the regulatory system and stimulate investment. This law provides additional incentives, beyond those in the fast track law, available to domestic and foreign investors, dependent on the sector and the location of the investment.

Greece’s tax regime has lacked stability during the economic crisis, presenting additional obstacles to investment, both foreign and domestic. Foreign firms are not subject to discrimination in taxation. Numerous changes to tax laws and regulations since the beginning of the economic crisis injected uncertainty into Greece’s tax regime. As part of Greece’s August 2015 bailout agreement, the government converted the Ministry of Finance’s Directorate-General for Public Revenue into a fully independent tax agency effective January 2017, with a broad mandate to increase collection and develop further reforms to the tax code aimed at reducing evasion and increasing the coverage of the Greek tax regime.

Foreign investment is not legally prohibited or otherwise restricted. Proposed laws and regulations are published in draft form for public comment before Parliament takes up consideration of the legislation. The International Financial Reporting Standards for listed companies were introduced in 2005, in accordance with EU directives. These rules improved the transparency and accountability of publicly traded companies.

Greece is not one of the 29 countries listed on www.businessfacilitation.org.

International Regulatory Considerations

Citizens of other EU member state countries may work freely in Greece. Citizens of non-EU countries may work in Greece after receiving residence and work permits. There are no discriminatory or preferential export/import policies affecting foreign investors, as EU regulations govern import and export policy, and increasingly, many other aspects of investment policy in Greece.

Greece has been a World Trade Organization member since January 1, 1995, and a member of the General Agreement on Tariffs and Trade (GATT) since March 1, 1950. Greece is in compliance with WTO Trade-Related Investment Measures (TRIMs) requirements. There are no performance requirements for establishing, maintaining, or expanding an investment. Performance requirements may come into play, however, when an investor wants to take advantage of certain investment incentives offered by the government. Greece has not enacted measures that are inconsistent with TRIMs requirements, and the Embassy is not aware of any measures alleged to violate Greece’s WTO TRIMs obligations. Trade policy falls within the competence and jurisdiction of the European Commission Directorate General for Trade and is generally not subject to regulation by member state national authorities. On November 5, 2012, China requested WTO consultations with the EU, Greece, and Italy regarding certain measures, including domestic content restrictions that affect the renewable energy generation sector relating to feed-in tariff programs of EU member States, including but not limited to Italy and Greece.

Legal System and Judicial Independence

Although Greece has an independent judiciary, the court system is an extremely time-consuming and unwieldy means for enforcing property and contractual rights. According to the Enforcing Contracts Indicator of the Doing Business 2017 survey, Greece ranks 137 among 190 countries in terms of the speed of delivery of justice, requiring 1,580 days (more than four years) on average to resolve a dispute, compared to the OECD high income countries average of 578 days. The government committed, as part of its three bailout packages, to reforms intended to expedite the processing of commercial cases through the court system. In July 2015, the government adopted a significant set of reforms to the code of civil procedure (law 4335/2015). These reforms aimed to accelerate judicial proceedings in support of contract enforcement and investment climate stability, and entered into force in January 2016. Foreign companies report, however, that Greek courts do not consistently provide fast and effective recourse. Problems with judicial corruption reportedly still exist. Commercial and contractual laws accord with international norms.

Laws and Regulations on Foreign Direct Investment

In August 2017, the Greek government passed Law 4487, which aims to create the legal framework for enhancing film production (movies, TV shows, and gaming software) through investment incentives. In particular, a film production company can receive (in the form of state subsidy) 25 percent (fixed) of their expenses, up to EUR 5 million. The expenses can include salaries, copyright payments, renting a studio, equipment, transportation etc. The subsidy is tax free and the investment (film production) should be budgeted over EUR 100,000. Beneficiaries are either companies based in Greece or foreign companies that have an affiliated company in the country.

Investments in Greece operate under two main laws: the new Investment Law (4399/2016) that addresses small-scale investments and Law 4146/2013 that addresses strategic investments. In particular;

  • Law 4399/2016, entitled Statutory framework to the establishment of Private Investments Aid Schemes for the regional and economic development of the country was passed in June 2016. Its key objectives include the creation of new jobs, the increase of extroversion, the reindustrialization of the country, and the attraction of FDI. The law provides aids (as incentives) for companies that invest from EUR 50,000 (Social Cooperative Companies) up to EUR 500,000 (large sized companies) as well as tax breaks. The Greek government provides funds to cover part of the eligible expenses of the investment plan; the amount of the subsidy is determined based on the region and the business size. Qualified companies are exempt from paying income tax on their pre-tax profits for all their activities. There is a fixed corporate income tax rate and fast licensing procedures. Eligible economic activities are manufacturing, shipbuilding, transportation/infrastructure, tourism, and energy.
  • Law 4146/2013, entitled the “Creation of a Business-Friendly Environment for Strategic and Private Investments” is the other primary investment incentive law currently in force. The law aims to modernize and improve the institutional framework for private investments, raise liquidity, accelerate investment procedures, and increase transparency. It seeks to provide an efficient institutional framework for all investors and speed the approval processes for pending and approved investment projects. The law created a general directorate for private investments within the Ministry of Economy (formerly the Ministry of Development) and reduced the value of investments needed to be considered strategic. The law also provides tax exemptions and incentives to investors and allows foreign nationals from non-EU countries who buy property in Greece worth over EUR 250,000 (USD 285,000) to obtain five-year renewable residence permits for themselves and their families. The law further foresees the creation of a central licensing authority aimed at establishing a one-stop-shop service to accelerate implementation of major investments. More about this law can be found online at http://www.enterprisegreece.gov.gr/en/doing-business/investment-incentives-law  and at http://www.enterprisegreece.gov.gr/files/investment_law/EN_INTERNET.PDF 
  • Law 3908/2011 is gradually being phased out by law 4146 (above).
  • Law 3919/2011 aims to liberalize more than 150 currently regulated or closed-shop professions. The implementation of this law continued in 2013 and 2014.
  • Law 3982/2011 reduced the complexity of the licensing system for manufacturing activities and technical professions and modernized certain qualification and certification requirements to lower barriers to entry.
  • Law 4014/2011 simplified the environmental licensing process.
  • Law 3894/2010 (also known as fast track) allows Enterprise Greece to expedite licensing procedures for qualifying investments in the following sectors: industry, energy, tourism, transportation, telecommunications, health services, waste management, or high-end technology/innovation. To qualify, investments must meet one of the following conditions:
    • exceed EUR 100 million;
    • exceed EUR 15 million in the industrial sector, operating in industrial zones;
    • exceed EUR 40 million and concurrently create at least 120 new jobs; or
    • create 150 new jobs, regardless of the monetary value of the investment.

More about fast track licensing of strategic investments can be found online at http://www.enterprisegreece.gov.gr/en/strategic-investments/legal-framework 

Other investment laws include:

  • Law 3389/2005 introduced the use of public-private partnerships (PPP). This law aimed to facilitate PPPs in the service and construction sectors by creating a market-friendly regulatory environment.
  • Law 3426/2005 completed Greece’s harmonization with EU Directive 2003/54/EC and provided for the gradual deregulation of the electricity market. Law 3175/2003 harmonized Greek legislation with the requirements of EU Directive 2003/54/EC on common rules for the internal electricity market. Law 2773/99 initially opened up 34 percent of the Greek energy market, in compliance with EU Directive 96/92 concerning regulation of the internal electricity market.
  • Law 3427/2005, which amended Law 89/67, provides special tax treatment for offshore operations of foreign companies established in Greece. Special tax treatment is offered only to operations in countries that comply with OECD internationally-agreed tax standards. The most up-to-date list of countries in compliance can be found at http://www.oecd.org/dataoecd/50/0/43606256.pdf 
  • Law 2364/95 and supporting amendments governs investment in the natural gas market in Greece.
  • Law 2289/95, which amended Law 468/76, allows private (both foreign and domestic) participation in oil exploration and development.
  • Law 2246/94 and supporting amendments opened Greece’s telecommunications market to foreign investment.
  • Legislative Decree 2687 of 1953, in conjunction with Article 112 of the Constitution, gives approved foreign productive investments (primarily manufacturing and tourism enterprises) property rights, preferential tax treatment, and work permits for foreign managerial and technical staff. The Decree also provides a constitutional guarantee against unilateral changes in the terms of a foreign investor’s agreement with the government, but the guarantee does not cover changes in the tax regime.

Competition and Anti-Trust Laws

Under Articles 101-109 of the Treaty on the Functioning of the EU, the European Commission (EC), together with member state national competition authorities, directly enforces EU competition rules. The European Commission Directorate-General for Competition carries out this mandate in member states, including Greece. Greece’s competition policy authority rests with the Hellenic Competition Commission, in consultation with the Ministry of Economy. The Hellenic Competition Commission protects the proper functioning of the market and ensures the enforcement of the rules on competition. It acts as an independent authority and has administrative and financial autonomy.

Expropriation and Compensation

Private property may be expropriated for public purposes, but the law requires this be done in a nondiscriminatory manner and with prompt, adequate, and effective compensation. Due process and transparency are mandatory, and investors and lenders receive compensation in accordance with international norms. There have been no expropriation actions involving the real property of foreign investors in recent history, although legal proceedings over expropriation claims initiated, in one instance, over a decade ago, continue to work through the judicial system.

Dispute Settlement

ICSID Convention and New York Convention

Greece is a member of both the International Center for the Settlement of Investment Disputes (ICSID) and the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York convention).

Investor-State Dispute Settlement

The Embassy is aware of a few ongoing investment disputes dating from more than ten years ago. Greece accepts binding international arbitration of investment disputes between foreign investors and the Greek government, and foreign firms have found satisfaction through arbitration. International arbitration and European Court of Justice Judgments supersede local court decisions. The judicial system provides for civil court arbitration proceedings for investment and trade disputes. Although an investment agreement could be made subject to a foreign legal jurisdiction, this is not common, particularly if one of the contracting parties is the Greek government. Foreign court judgments are accepted and enforced, albeit slowly, by the local courts.

In an effort to create a more investor-friendly environment, the government established an Investor’s Ombudsman service. The Ombudsman is authorized to mediate disputes that arise between investors and the government during the licensing procedure. The Ombudsman, housed within Enterprise Greece, can be employed by investors with projects exceeding EUR 2 million in value. More info on the Ombudsman service can be found here: http://www.enterprisegreece.gov.gr/en/ombudsman/investor-ombudsman .

International Commercial Arbitration and Foreign Courts

As noted above, Greece’s independent judiciary is both time-consuming and unwieldy as a means for enforcing property and contractual rights. The government has committed to implementing significant reforms to the judicial system, aimed at speeding up adjudications and improving dispute resolution for investors.

Bankruptcy Regulations

Bankruptcy laws in Greece meet international norms. Under Greek bankruptcy law 3588/2007, private creditors receive compensation after claims from the government and insurance funds have been satisfied. Monetary judgments are usually made in euros unless explicitly stipulated otherwise. Greece has a reliable system of recording security interests in property. According to the World Bank’s 2018 Doing Business report, resolving insolvency in Greece takes 3.5 years on average and costs 9 percent of the debtor’s estate, with the most likely outcome that the company will be sold piecemeal. Greece ranks 57 of 190 economies surveyed for ease of resolving insolvency in the Doing Business report (from 52 in 2016).

Investment Incentives

Investment incentives are available on an equal basis for both foreign and domestic investors in productive enterprises. The investment laws in Greece aim to increase liquidity, accelerate investment processes, and ensure transparency. They provide an efficient institutional framework for all investors and speed the approval process for pending investment projects. The basic investment incentives law 4146/2013, Creation of a Development Friendly Environment for Strategic and Private Investments, aims to modernize and improve the institutional and legal framework to attract private investment. Separately, Law 3908/2011 (which replaced Law 3299/2004) provides incentives in the form of tax relief, cash grants, leasing subsidies, and soft loans on qualifying investments in all economic sectors with some exceptions.

In evaluating applications for tax and other financial incentives for investment, Greek authorities consider several criteria, including the viability of the planned investment, the expected impact on the economy and regional development (job creation, export orientation, local content use, energy conservation, and environmental protection), the use of innovative technology, and the creditworthiness and capacity of the investor. Progress assessments are conducted on projects receiving incentives, and companies that fail to implement projects as planned may be forced to give up incentives initially granted to them. All information transmitted to the government for the approval process is to be treated confidentially by law.

Investment categories are:

  • General Entrepreneurship
  • Regional Cohesion
  • Technological development
  • Youth Entrepreneurship (18-40 years old)
  • Large Investment Plans (above EUR 50 million)
  • Integrated, Multi-Annual Business Plans
  • Partnership & Networking

The entire application and evaluation process shall not exceed six months (more information can be found at https://www.ependyseis.gr ).

Research and Development

Offset agreements, co-production, and technology transfers are commonplace in Greece’s procurement of defense items. Although the most recent Greek defense procurement law eliminated offset requirements, there are some remaining ongoing active offset contracts, as well as expired offset contracts with U.S. firms that are potentially subject to non-performance penalties. Defense procurements are still subject to economic development requirements, which are, in effect, similar to offsets. In 2014, the government committed to resolving offset contract disputes in a way that would satisfy both parties and avoid the imposition of penalties or fines.

In general, U.S. and other foreign firms may participate in government-financed and/or subsidized research and development programs. Foreign investors do not face discriminatory or other formal inhibiting requirements. However, many potential and actual foreign investors assert the complexity of Greek regulations, the need to deal with many layers of bureaucracy and the involvement of multiple government agencies all discourage investment.

Foreign Trade Zones/Free Ports/Trade Facilitation

Greece has three free-trade zones, located at the Piraeus, Thessaloniki, and Heraklion port areas. Greek and foreign-owned firms enjoy the same advantages in these zones. Goods of foreign origin may be brought into these zones without payment of customs duties or other taxes and may remain free of all duties and taxes if subsequently transshipped or re-exported. Similarly, documents pertaining to the receipt, storage, or transfer of goods within the zones are free from stamp taxes. Handling operations are carried out according to EU regulations 2504/1988 and 2562/1990. Transit goods may be held in the zones free of bond. These zones also may be used for repackaging, sorting, and re-labeling operations. Assembly and manufacture of goods are carried out on a small scale in the Thessaloniki Free Zone. Storage time is unlimited, as long as warehouse rents are paid every six months.

Performance and Data Localization Requirements

The Greek government does not follow a policy of forced localization, designed to require foreign investors to use domestic content in goods or technology, with the exception of economic development requirements in many defense contracts (see Research and Development above). Some foreign investors partner with local companies or to hire local staff/experts, however, as a way to facilitate their entry into the market. The government is not taking steps to force foreign investors to keep a specific amount of the data they collect and store within Greek national borders.

Real Property

Greek laws extend the protection of property rights to both foreign and Greek nationals, and the legal system protects and facilitates acquisition and disposition of all property rights.

Multiple layers of authority in Greece are involved in the issuance or approval of land use and zoning permits, creating disincentives to real property investment. Secured interests in property are movable and real, recognized and enforced. The concept of mortgage does exist in the market and can be recorded through the banks. The government is working to create a comprehensive land registry — scheduled to be completed by 2020 — which is expected to increase the transparency of real estate management. Greece ranks 141 out of 190 countries for Ease of Registering Property in the World Bank’s Doing Business 2017 Report, up from 144 last year.

Foreign nationals can acquire real estate property in Greece, though they first need to be issued a tax authentication number. However, for the border areas, foreign nationals first require a license from the Greek state (Law 3978/2011). In another effort to boost investment, the government passed law 4146/2013, which allows foreign nationals who buy property in Greece worth over EUR 250,000 USD 285,000) to obtain a five-year residence permit for themselves and their families. The “Golden Visa” program has been extended to buyers of Greek bonds with a value of at least EUR 250,000. The permit can be extended for an additional five years and allows travel to other EU and Schengen countries without a visa.

Intellectual Property Rights

Greece was placed back on the U.S. Special 301 Watch List in 2008, where it remains due to widespread piracy and IP enforcement challenges. In 2017 Greece amended its Copyright law to address online piracy. However, unlicensed software use, including by government agencies, and failure to adequately investigate or prosecute IP related infringement have kept Greece on the USTR’s Watch List for 2018. Patents are available for all areas of technology, and compulsory licensing is not used. The law protects patents and trade secrets for a period of 20 years. Violations of trade secrets and semiconductor chip layout design are not problems in Greece, though some companies have expressed concern about possible problems protecting test data for non-patented products.

Qverall enforcement of intellectual property rights (IPR) laws is not rigorous, and rights holders continue to experience problems in Greece. Recently, the government improved IPR enforcement by establishing a department within the Ministry of Public Order and Citizen Protection (now part of the Ministry of Interior) for economic and cyber-crimes, including copyright infringement, and by preparing a code of conduct for internet service providers. As mentioned in the 301 Report, the government has not adequately addressed end-user software piracy, in either the public or private sectors. The audiovisual, music, and software industries bear the brunt of IPR violations in Greece. Unlicensed sharing of copyrighted software among multiple computers is the largest problem for the software industry, while unlicensed file sharing of music and movies on the Internet is rampant.

A law enacted in June 2011 (Law 3982/2011), which provides police ex officio authority to confiscate and destroy counterfeit goods, has been effective in some areas, but much remains to be done. Due to continued budget cuts as a result of Greece’s fiscal commitments, IPR enforcement efforts, including seizures of counterfeit goods, investigations, operational programs, and fine collections remain lackluster. Private sector companies have asked Greek authorities to require only storage of a sample of the seized goods in official government facilities to reduce the burden of having to pay for storage for long periods of time. This remains an issue of contention. According to the government, counterfeit products in Greece are mainly luxury bags, wallets, footwear, clothing, accessories, watches, cigarettes, spirits, cell phone batteries and accessories, sunglasses, toys, and spare car parts. Trademark violations, especially in the apparel and footwear sectors, are still widespread.

Greece is a member of the World Intellectual Property Organization (WIPO), the Paris Convention for the Protection of Industrial Property, the European Patent Convention, the Washington Patent Cooperation Treaty, and the Bern Copyright Convention. As a member of the EU, Greece has harmonized its IP legislation with EU rules and regulations. The WTO-Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement was incorporated into Greek legislation on February 28, 1995 (Law 2290/1995). The Greek government also signed and ratified the WIPO internet treaties, and incorporated them into Greek legislation (Laws 3183 and 3184/2003) in 2003. Greece’s legal framework for copyright protection is found in Law 2121 of 1993 on copyrights and Law 2328 of 1995 on the media.

For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ .

Resources for Rights Holders

Embassy Point of Contact:

U.S. Embassy Athens
Economic Section
91 Vas. Sophias Avenue, Athens, Greece 10160
Phone: +30-210-720-2490

A list of local attorneys is available at https://gr.usembassy.gov/u-s-citizen-services/attorneys/

American-Hellenic Chamber of Commerce
109-111 Messoghion Avenue, Politia Business Center
Athens, Greece 11526
Phone: +30-210-699-3559, Fax: +30-210-698-5686
Email: info@amcham.gr
Web Site: www.amcham.gr 

Capital Markets and Portfolio Investment

Following EU regulations, Greece is open to foreign portfolio investment. Law 3371/2005 sets an effective legal framework to encourage and facilitate portfolio investment. Law 3283/2004 incorporates the European Council’s Directive 2001/107, setting the legal framework for the operation of mutual funds. Until June 2015, although liquidity in the markets was tight, sizeable positions could enter and exit. With the imposition of capital controls on June 29, 2015, for a period of six months (July 2015 – December 2015) domestic investors could only acquire shares with the injection of “fresh money” and could not use existing funds. Short-selling of banking shares was not allowed. As a result, FTSE downgraded the Athens Stock Exchange from “advanced” to “advanced emerging markets”– in effect since March 2016. The Bank of Greece complies with its IMF Article VIII obligations and does not generally impose restrictions on payments. Transfers for current international transactions are allowed, but are subject to specific conditions for approval. The lack of liquidity in the market along with the challenging economic environment have made the allocation of credit very tight, but is accessible to foreign investors on the local market, who also have access to a variety of credit instruments.

Money and Banking System

The implementation of a broad-based bank recapitalization program in 2012 and 2013, and a rapid consolidation of institutions in the sector, largely stabilized the banking sector by early 2014. However, following the election of the current government in January 2015, bank deposit flight accelerated. By June 2015, total deposits in the Greek banking system had fallen to EUR 134 billion, down from EUR 164 billion in October 2014. Uncertainty caused by the controversial negotiations with Greece’s creditors led to the June 2015 imposition of capital controls and a complete closure of the banks for two weeks, which, though necessary to prevent the banking sector’s collapse, weakened the banks’ capital positions.

In November 2015, following an Asset Quality Review and Stress Test conducted by the ECB as a requirement of the new ESM agreement, a third recapitalization of Greece’s four systemic banks (National Bank of Greece, Piraeus Bank, Alpha Bank, and Eurobank) took place. The recapitalization concluded by the end of November with the banks remaining in private hands, after raising EUR 6.5 billion from foreign investors, mostly hedge funds. The ratio of non-performing exposures (NPEs) reached 43.1 percent at the end of December 2017, down 10 percent compared to December 2016. More broadly, NPEs declined to EUR 95.7 billion from EUR 108.4. Compared to March 2016, when the stock of NPEs reached the peak, the reduction is 12 percent (EUR 13 billion). Similarly, non-performing loans (NPLs) – loans that have not been serviced or paid on for more than 90 days – dropped to EUR 65.9 billion at the end of December 2017. Banks estimate that about 20 percent of these NPEs are owned by so-called “strategic defaulters” – borrowers who refrain from paying their debts to lenders in order to take advantage of the laws enacted during the financial crisis to protect borrowers from foreclosure or creditors collection even though they are able to pay their obligations.

Developing an effective NPL management strategy is among the most difficult components of the government’s negotiations with its creditors. Under the terms of the ESM agreement, Greece must create an NPL market through which the loans could, over time, be sold or transferred for servicing purposes to foreign investors. Much of this work has now been completed, and more than ten servicers have been licensed by the Bank of Greece. The sale and securitization environment for non-performing loans continues to mature, with all of Greece’s systemic banks having conducted portfolio sales of secured and unsecured loan tranches since mid-2017. The potential sale and/or transfer of Greek NPLs continues to receive interest by a large number of Greek and foreign companies and funds, signaling a viable market. After several regulatory and political delays in 2017, the Greek state’s electronic auction platform for collateral and foreclosed assets is functioning, with expectations that auction volumes will continue to expand to more than 20,000 per year by the end of 2018. The government seeks to exclude loans linked with mortgages for primary residencies (at least through the end of 2018 under existing law) and preventing aggressive collection on business as part of the NPL secondary market activity.

Poor asset quality inhibits banks’ ability to provide systemic financing. Deposits stood at EUR 124.7 billion as of January 2018, down from EUR 119.7 billion a year earlier. In the eight -year period from September 2009 (when deposits reached their highest level of EUR 237 billion) to September 2017, overall deposits shrunk by a total of EUR 114.5 billion. According to the latest data, Greece’s systemic banks hold the following assets: Piraeus Bank, EUR 67.4 billion (Q4 2017), National Bank of Greece, EUR 75.5 billion (Q1 2017); Alpha Bank, EUR 64.8 billion (2016); and Eurobank, EUR 60 billion (2017).

Few U.S. financial institutions have a presence in Greece. In September 2014, Alpha Bank acquired the retail operations of Citibank, including Diners Club. Bank of America serves only companies and some special classes of pensioners.

There are a limited number of cross-shareholding arrangements among Greek businesses. To date, the objective of such arrangements has not been to restrict foreign investment. The same applies to hostile takeovers, a practice which has been recently introduced in the Greek market. The government actively encourages foreign portfolio investment.

Greece has a reasonably efficient capital market that offers the private sector a wide variety of credit instruments. Credit is allocated on market terms prevailing in the Eurozone and credit is equally accessible by Greek and foreign investors. An independent regulatory body, the Hellenic Capital Market Commission, supervises brokerage firms, investment firms, mutual fund management companies, portfolio investment companies, real estate investment trusts, financial intermediation firms, clearing houses and their administrators (e.g. the Athens Stock Exchange), and investor indemnity and transaction security schemes (e.g. the Common Guarantee Fund and the Supplementary Fund), and also encourages and facilitates portfolio investments.

Owner-registered bonds and shares are traded on the Athens Stock Exchange (ASE), which has held developed country status since 2001, according to most western investment firms. It is mandatory in Greece for the shares of banking, insurance, and public utility companies to be registered. Greek corporations listed on the ASE that are also state contractors are required to have all their shares registered. In September 2015, during the annual country classification review, FTSE announced that the Greek exchange would be downgraded from “advanced” to “advanced emerging markets.” The decision took effect as of March 2016. In June 2013, equity index provider MSCI downgraded Greece to advanced emerging-market status, a first in the index’s history, citing the ASE’s loss of 90 percent of its value since the start of the financial crisis in October 2007 and after Greece failed to meet criteria regarding securities borrowing and lending facilities, short selling, and transferability.

Greece has not explored or announced that it intends to implement or allow the implementation of blockchain technologies in its banking transactions.

Foreign Exchange and Remittances

Foreign Exchange Policies

Greece’s foreign exchange market adheres to EU rules on the free movement of capital. Until June 2015, receipts from productive investments could be repatriated freely at market exchange rates, and there were no restrictions on, or difficulties with, converting, repatriating, or transferring funds associated with an investment. In late June 2015, the government declared a bank holiday, during which banks were closed for two weeks, and imposed capital controls. Capital controls placed a limit on weekly cash withdrawal amounts and restricted the transfer of capital abroad. Although the government has continued to ease capital controls in 2016 and abolished all capital controls on stock transactions in December 2015, several restrictions still apply. A five-member “Banking Transaction Approval Committee” was established by the Ministry of Finance and is the competent authority to approve transactions abroad, in coordination with the Bank of Greece. Currently, the daily limit for commercial payments abroad stands at EUR 250,000 (with some exceptions).

Remittance Policies

Remittance of investment returns is also subject to capital controls. Greece is not engaged in currency manipulation for the purpose of gaining a competitive advantage. The country is a member of the Eurozone, which employs a freely floating exchange rate.

The Financial Action Task Force (FATF), in its latest report on Greece (October 2011), recognized that the country had made significant progress in addressing the deficiencies identified in the 2007 Mutual Evaluation Report. All Core and all Key Recommendations are at a level essentially equivalent to compliant (C) or largely compliant (LC) under FATF definitions. In 2011, the FATF removed Greece from its regular follow-up process in recognition of this progress. The fourth round of mutual evaluation of Greece will take place in October 2018.

Sovereign Wealth Funds

There are no sovereign wealth funds in Greece. Public pension funds may invest up to 20 percent of their reserves in state or corporate bonds.

Greek state-owned enterprises (SOEs) are active in utilities, transportation, energy, media, health, and the defense industry. A private website maintains an online list of SOEs, though it is not affiliated with official governmental sources. The uniform legal definition of an SOE is a company/organization that belongs to or is controlled and managed by the state. Most Greek SOEs are structured under the auspices of the Hellenic Corporation for Assets and Participations (HCAP), an independent holding company for state assets mandated by Greece’s most recent bailout and formally launched in 2016. HCAP’s supervisory board is independent from the Greek state and is appointed in part by Greece’s creditor institutions. Some SOEs are still supervised by the Finance Ministry’s Special Secretariat for Public Enterprises and Organizations, established by Law 3429/2005. Private companies previously were not allowed to enter the market in sectors where the SOE functioned as a monopoly, for example, water, sewage, or urban transportation. However, several of these SOEs are planned for privatization as a requirement of the country’s bailout programs, intended to liberalize markets and raise revenues for the state.

Official government statements on privatization since 2015 have sometimes led to confusion among investors. Some senior officials have declared their opposition to previously approved privatization projects, while other officials have maintained the stance that the government remains committed to the sale of SOEs. Under the bailout agreement, Greece has moved forward with the deregulation of the electricity market. In sectors opened to private investment, such as the telecommunications market, private enterprises compete with public enterprises under the same nominal terms and conditions with respect to access to markets, credit, and other business operations, such as licenses and supplies. Some private sector competitors to SOEs report the government has provided preferential treatment to SOEs in obtaining licenses and leases. The government actively seeks to end many of these state monopolies and introduce private competition as part of its overall reform of the Greek economy. Greece – as a member of the EU – participates in the Government Procurement Agreement within the framework of the WTO. SOEs purchase goods and services from private sector and foreign firms through public tenders. SOEs are subject to budget constraints, with salary cuts imposed in the past few years on public sector jobs.

Privatization Program

The Hellenic Republic Asset Development Fund (HRADF, or TAIPED, as it is known in Greek), an independent non-governmental privatization fund, was established in 2011 under Greece’s bailout program to manage the sale or concession of major government assets, to raise substantial state revenue, and to bring in new technology and expertise for the commercial development of these assets. These include listed and unlisted state-owned companies, infrastructure, and commercially valuable buildings and land. Foreign and domestic investor participation in the privatization program has generally not been subject to restrictions, although the economic environment during the crisis has challenged the domestic private sector’s ability to raise funds to purchase firms slated for privatization.

The August 2015 ESM bailout agreement required Greece to consolidate the HRADF, the Hellenic Financial Stability Fund (HFSF), the Public Properties Company (ETAD) and a new entity that will manage other state-owned enterprises (SOEs) into the Hellenic Corporation of Assets and Participations (or HCAP), was formed by Law 4389/2016. In March 2017, HCAP received short- and long-term guidelines from the Minister of Finance, and in September 2017 it received strategic guidelines from the Greek state (HCAP’s sole shareholder).

Privatizations are subject to a public bidding process, which is easy to understand, non-discriminatory, and transparent. Notable privatizations completed in 2017 include the sale of Trainose (Railway Company) to the Italian company Ferrovie dello Stato Italiane and the major tourist hotel complex Astir Vouliagmeni in Athens. The deal for the Thessaloniki Port Authority (OLTh) was completed in early 2018, along with the sale of the remaining 5 percent of OTE shares to Deutsche Telecom, and rolling stock maintenance and railroad availability services company Rosco. In April 2018, a consortium of Italy’s Snam, Spain’s Enagas, and Belgium’s Fluxys submitted the highest bid in the international tender for the acquisition of a 66 percent stake in Greece’s gas transmission system operator DESFA. Currently, the privatizations of Hellenic Petroleum and the Egnatia motorway in northern Greece (Greece’s biggest highway) are ongoing.

Awareness of corporate social responsibility (CSR) including environmental, social, and governance issues, has been growing over the last decade among both producers and consumers in Greece. Several enterprises, particularly large ones, in many fields of production and services, have accepted and now promote CSR principles. A number of non-profit business associations have emerged in the last few years (Hellenic Network for Corporate Social Responsibility, Global Sustain, etc.) to disseminate CSR values and to promote them in the business world and society more broadly. These groups’ members have incorporated programs that contribute to the sustainable economic development of the communities in which they operate; minimize the impacts of their activities on the environment and natural resources; create healthy and safe working conditions for their employees; provide equal opportunities for employment and professional development; and provide shareholders with satisfactory returns through responsible social and environmental management. Firms that pursue CSR in Greece enhance the public acceptance and respect that they enjoy. In 2014, the government drafted a National Action Plan for Corporate Social Responsibility for the 2014-2020 time period. The main goal of the plan is to increase the number of companies that recognize and use CSR to formulate their strategies.

Based on a research by Ernst & Young for calendar year 2016 (published in 2017), 81 percent of employees in Greek businesses consider that corruption is widespread in the country. Only 22 percent said they knew their business had a special hotline for denouncing corruption cases. Only two percent of Greek business employees have resigned from their post on the grounds of “unethical behavior.”

Bribery is a criminal act and the law provides severe penalties for infractions, although diligent implementation and haphazard or uneven enforcement of the law remains an issue. Historically, the problem has been most acute in the area of government procurement, as political influence and other considerations are widely believed to play a significant role in the evaluation of bids. Corruption related to the health care system and political party funding are also areas of concern, as is the fragmented anti-corruption apparatus. NGOs and other observers have expressed concern over perceived high levels of official corruption. Permanent and ad hoc government entities charged with combating corruption are understaffed and underfinanced. Various polls have indicated that 95 percent of Greeks believe corruption is a widespread problem in the country, placing Greece well above the EU average of 76 percent. Three out of five Greeks polled said they believed corruption affected their everyday lives, compared to an EU average of only 26 percent.

The Ministry of Justice prosecutes cases of bribery and corruption. In cases where politicians are involved, the Greek parliament can conduct investigations and/or lift parliamentary immunity to allow a special court action to proceed against the politician. A December 2014 law does not allow high ranking officials, including the prime minister, ministers, alternate, and deputy ministers, parliament deputies, European Parliament deputies, general and special secretaries, regional governors and vice governors, and mayors and deputy mayors to benefit from more lenient sentences in cases involving official bribes.

On March 19, 2015, the government passed Law 4320, which provides for the establishment of a General Secretariat for Combatting Corruption under the authority of a new Minister of State. Under Article 12 of the Law, this entity drafts a national anti-corruption strategy, with an emphasis on coordination between anti-corruption bodies within various ministries and agencies, including the Economic Police, the Financial and Economic Crime Unit (SDOE), the Ministries’ Internal Control Units, and the Health and Welfare Services Inspection Body. Based on Law 4320, two major anti-corruption bodies, the Inspectors-Controllers Body for Public Administration (SEEDD) and the Inspectors-Controllers Body for Public Works (SEDE), were moved under the jurisdiction of the General Secretariat for Combatting Corruption. A Minister of State for combatting corruption was appointed to the cabinet following the January 2015 elections and given oversight of government efforts to combat corruption and economic crimes. The minister drafted coordinated plans of action and monitored their implementation, and was given operational control of the Economic Crime division of the Hellenic Police, the SDOE, ministries’ internal control units, and the Health and Welfare Services’ inspection body. Following the September 2015 national elections, the cabinet post of Minister of State for combatting corruption was abolished, and those duties were assigned to a new alternate minister for combatting corruption in the Ministry of Justice, Transparency, and Human Rights.

Legislation passed on May 11, 2015 provides a wider range of disciplinary sanctions against state employees accused of misconduct or breach of duty, while eliminating the immediate suspension of an accused employee prior to the completion of legal proceedings. If found guilty, offenders could be deprived of wages for up to 12 months and forced to relinquish their right to regain a senior post for a period of one to five years. Certain offenders could also be fined from EUR 3,000 to EUR 100,000. The law requires income and asset disclosure by appointed and elected officials, including nonpublic sector employees, such as journalists and heads of state-funded NGOs. Several different agencies are mandated to monitor and verify disclosures, including the General Inspectorate for Public Administration, the police internal affairs bureau, the Piraeus appeals prosecutor, and an independent permanent parliamentary committee. Declarations are made publicly available. The law provides for administrative and criminal sanctions for noncompliance. Penalties range from two to ten years’ imprisonment and fines from EUR 10,000 to EUR 1 million.

UN Anticorruption Convention, OECD Convention on Combatting Bribery

Greece is a signatory to the UN Anticorruption Convention, which it signed on December 10, 2003, and ratified September 17, 2008. As a signatory of the OECD Convention on Combating Bribery of Foreign Government Officials and all relevant EU-mandated anti-corruption agreements, the Greek government is committed in principle to penalizing those who commit bribery in Greece or abroad. The OECD Convention has been in effect since 1999. Greek accession to other relevant conventions or treaties:

  • Council of Europe Civil Law Convention on Corruption: Signed June 8, 2000. Ratified February 21, 2002. Entry into force: November 1, 2003.
  • Council of Europe Criminal Law Convention on Corruption: Signed January 27, 1999. Ratified July 10, 2007. Entry into force: November 1, 2007.
  • United Nations Convention against Transnational Organized Crime: Signed on December 13, 2000. Ratified January 11, 2011.

Resources to Report Corruption

Government Agency
Organization: The Inspectors-Controllers Body for Public Administration
Address: 60 Sygrou Avenue, 11742, Athens
Telephone number: +30-213-215-8800
Email address: seedd@seedd.gr

Watchdog Organization
Organization: Transparency International Greece
Address: 4 Thetidos Street, 115 28, Athens
Telephone number: +30-210-722-4940
Email address: tihellas@otenet.gr

In 2017, and continuing into the first quarter of 2018, Greece experienced intermittent small-scale terrorist attacks such as targeted package bombs, improvised explosive devices, and unsophisticated incendiary devices (Molotov cocktails) from domestic anarchist groups aimed against the properties of political figures, party offices, privately-owned vehicles, ministries, police stations, businesses, and a foreign embassy. Greece has enhanced its anti-terrorism, counter-crime, and border control efforts over the last few years through new policies and cooperation through EU and bilateral agreements. Greece introduced policy changes regarding processing migrants entering and/or applying for asylum in Greece, particularly in response to EU border security concerns. Overall, bilateral counterterrorism cooperation with the Greek government remained strong. Support from the Greek security services with respect to the protection of American interests is excellent.

Trade unions and civil society groups frequently held strikes and demonstrations in 2017 and into the second quarter of 2018 to protest the Greek government’s adoption of reforms and implementation of austerity measures required by the EU/ECB/IMF bailout packages. While most of these demonstrations and strikes were peaceful and small-scale, they often caused temporary disruption to essential services and traffic. Frequent anarchist and anti-authoritarian demonstrations continued in 2017 and the first quarter of 2018, as the government negotiated and implemented terms of a bailout for Greece. Anarchist groups are known in some cases to attach themselves to other demonstrations to create mayhem.

Starting in 2007, domestic terrorism re-emerged, dominated by four groups: Revolutionary Struggle (RS), Conspiracy of Fire Nuclei (CFN), Sect of Revolutionaries (SR), and The Popular Fighters Group (PFG). These groups typically have targeted security forces, government ministries, politicians, and Greek business. However, they have also launched attacks against U.S. and other Western businesses.

The RS, an anti-establishment radical leftist group, has claimed responsibility for a large number of attacks on police, banks, and other targets, including an RPG attack on the U.S. Embassy in January 2007 and the bombing of the Athens Stock Exchange in September 2009. In April 2014 RS claimed responsibility for a car bomb attack targeting the offices of the IMF and Greek Central Bank. Since 2013, five members of RS leadership have been arrested and convicted to long-term imprisonment.

The PFG, also known as the Group of Popular Fighters (OLA), claimed responsibility for the November 2015 bomb attack at the offices of the Hellenic Federation of Enterprises, which caused extensive damage to the offices and surrounding buildings. It also claimed responsibility for the December 2014 attack on the Israeli embassy in Athens, which resulted in no injuries and minor damage to the building. The shells found at the scene matched those used in the attack on the German Ambassador’s residence in Athens on December 30, 2013, for which PFG claimed responsibility in February 2014. PFG has also claimed responsibility for an indirect fire attack on a Mercedes-Benz building on January 12, 2014, and an attack in January 2013 against the headquarters of the then-governing New Democracy party in Athens.

There is an adequate supply of skilled, semi-skilled, and unskilled labor in Greece, although some highly technical skills may be lacking. Illegal immigrants predominate in the unskilled labor sector in many urban areas, and in rural areas predominately in agriculture. Greece provides residency permits to migrants for a variety of reasons, including work. In December 2017, there were 525,519 holders of residence permits per the Ministry of Migration Policy. In July 2015, Parliament adopted a new law regulating the status of non-EU foreign nationals recruited to work in the country as seasonal workers. The law also reduced the minimum consecutive residency period in the country required for undocumented migrants to be eligible to apply for a residency permit from ten to seven years, such applications being judged on the applicant’s strong ties to the country. The same law outlined the requirements for setting work contracts, required proof of adequate shelter for workers and imposes a EUR 1,500 (USD1,650) fine for employers found not to provide this, required prepayment of at least one month’s worth of social security for each employee, provides basic labor rights to each worker, and prohibits employers from recruiting workers if found to have previously recruited workers through fraudulent means. The law also stipulated that daily wages for non-EU foreign seasonal workers cannot be less than that of an unqualified worker. The law granted seasonal non-EU foreign workers the same rights as citizens with respect to minimum age of employment, labor conditions, the right to association, unionism, collective bargaining, education and vocational training, employment consultation services and the right to certain goods, services and benefits under conditions. The same law also provided that non-EU nationals who are victims of abusive conditions or labor accidents could be eligible to apply for a residency permit on humanitarian grounds.

Asylum-seekers are eligible to apply for a work permit once they complete their first asylum interview; however, the procedures for obtaining this permit were not widely understood by asylum-seekers, non-governmental organizations (NGOs), or government officials. According to the Greek Asylum Service there were over 38,000 pending asylum applications at the beginning of March 2018, plus 19,183 recognized refugees who arrived since 2015. Recognized refugees are entitled to the same labor rights as Greek nationals. NGOs and government officials working in migrant sites reported that some asylum-seekers perform undeclared seasonal agricultural labor in rural areas.

Greece has ratified International Labor Organization (ILO) Core Conventions. Specific legislation provides for the right of association and the rights to strike, organize, and bargain collectively. Greek labor laws set a minimum age (15) and wage for employment, determine acceptable work conditions and minimum occupational health and safety standards, define working hours, limit overtime, and apply certain rules for the dismissal of personnel. There is a difference between national minimum wage in the private sector for unspecialized workers aged 25 or older and workers below 25 years of age. The latter receive 84 percent of the salary of those over 25. A May 2015 law amended the laws prohibiting strikes during national emergencies. The new law explicitly prohibits the issuance of civil mobilization orders as a means of countering strike actions before or after their proclamation.

On September 13, 2017 Greece’s parliament passed new legislation providing for the temporary closure of businesses in cases where employers repeatedly violate the law concerning undeclared work or safety. Under the same law, employers are obliged to declare in advance their employees’ overtime work or changes in their work schedules. The legislation also provided for social and welfare benefits to be granted to surrogate mothers, including protection from dismissal during pregnancy and after childbirth. Courts are required to examine complaints filed by employees against their employers for delayed payment within two months after their filing, and issue decisions within 30 days after the hearing.

The government sets restrictions on mass dismissals in private and public companies employing more than 20 workers. Dismissals exceeding in number the limits set by law require consultations through the Supreme Labor Council (with worker, employer, and government representatives participating), and government authorization. Based on a ministerial decision in February 2014, the competency for approving dismissals passed from the Minister of Labor to the Ministry’s Secretary General.

Greek law provides for the right of workers to form and join independent unions, conduct their activities without interference, and strike. The establishment of trade unions in enterprises with fewer than 20 workers is prohibited. In July 2016, Parliament passed a law allowing armed forces personnel to form unions, while explicitly prohibiting strikes and work stoppages by those unions. Police also have the right to organize and demonstrate but not to strike. Greek law also generally protects the right to bargain collectively but restricts the right to bargain collectively on wages for persons under the age of 25. Anti-union discrimination is prohibited and workers fired for union activity are required to be reinstated. Company-level agreements take precedence over sectoral-level collective agreements in the private sector. Civil servants negotiate and conclude collective agreements with the government on all matters except salaries. Private companies allow some freedom to negotiate in-house labor agreements with employees and legislation passed between 2010 and 2013 granted companies greater freedoms to suspend and dismiss employees. Implementation of legislation aimed at opening several closed professions – industries where regulation effectively creates quotas – including pharmacists, lawyers, notaries, and engineers remains uneven, with several professions effectively remaining closed.

The number of inspectors authorized to conduct labor inspections reportedly exceeded 1,000, including labor inspectorate personnel and staff of the Ministry of Labor, Social Security, and Social Solidarity, the Social Insurance Fund, the Economic Crimes Division of the police, and the Independent Authority for Public Revenue. Despite government efforts to increase inspections for undeclared, under-declared, and unpaid work, trade unions and the media alleged that, due to insufficient inspectorate staffing, enforcement of labor standards was inadequate in the shipping, tourism, and agricultural sectors. Enforcement was also lacking among small enterprises (employing 10 or fewer persons). According to the Union of Labor Health Inspectors, authorities conducted approximately 45,000 inspections related to issues of health and safety at work, and ordered fines amounting to 7 million euros (USD 8.4 million) between 2015 and 2016.

Wage laws are not always enforced. Unions and media allege that some private businesses forced their employees to return part of their wages and mandatory seasonal bonuses, in cash, after being deposited in the bank. Several employees were reportedly registered as part-time workers but in essence worked additional hours without being paid. In other cases, employees were paid after months of delays and oftentimes with coupons and not in cash. Cases of employment for up to 30 consecutive days of work without weekends off were also reported. Such violations were mostly noted in the tourism, agriculture, and housekeeping services sectors.

Full Overseas Private Investment Corporation (OPIC) insurance coverage for U.S. investment in Greece is currently available on an exceptional basis. OPIC and the Greek Export Credit Insurance Organization signed an agreement in April 1994 to exchange information relating to private investment, particularly in the Balkans. Other insurance programs offering coverage for investments in Greece include the German investment guarantee program HERMES, the French agency COFACE, the Swedish Export Credits Guarantee Board (EKN), the British Export Credits Guarantee Facility (ECGF), and the Austrian Kontrollbank (OKB). Greece became a member of the Multilateral Investment Guarantee Agency (MIGA) in 1989.

For the purposes of OPIC currency inconvertibility insurance, currency inconvertibility is not an issue as Greece has been part of the Eurozone since 2001.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy

Host Country Statistical Source USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) (M USD) 2017 USD 219,800 2016 USD 192,600 http://www.statistics.gr/en/the-greek-economy 
Foreign Direct Investment Host Country Statistical Source USG or International Statistical Source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country (M USD, stock positions) 2016 USD 40 2016 USD 168 https://www.bankofgreece.gr/Pages/
Host country’s FDI in the United States (M USD, stock positions) 2016 USD 2,900 2016 USD 684 https://www.bankofgreece.gr/
Total inbound stock of FDI as % host GDP N/A 2016 15% https://data.oecd.org/

Table 3: Sources and Destination of FDI

Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 25.176 100% Total Outward 19.224 100%
Netherlands 5.695 22.6% Cyprus 4.523 23.5%
Luxembourg 5.428 21.5% Romania 2.500 13%
Germany 5.201 20.6% United States 2.472 12.8%
France 2.175 8.6% China: Hong Kong 1.986 10.3%
Switzerland 1.708 6.7% Netherlands 1.806 9.3%
“0” reflects amounts rounded to +/- USD 500,000.

Table 4: Sources of Portfolio Investment

Portfolio Investment Assets
Top Five Partners (Millions, US Dollars)
Total Equity Securities Total Debt Securities
All Countries 139.657 100% All Countries 12.028 100% All Countries 127.628 100%
Luxembourg 54.482 39% Luxembourg 8.690 72.2% Luxembourg 45.792 35.8%
United Kingdom 21.724 15.5% Ireland 1.611 13.3% United Kingdom 21.611 16.9%
Italy 9.219 6.6% France 396 3.2% Italy 9.212 7.2%
Spain 8.138 5.8% United States 387 3.2% Spain 8.123 6.3%
France 3.612 2.5% Netherlands 194 1.6% France 3.216 2.5%

Economic Counselor
U.S. Embassy Athens, Greece
+30 210-720-2304

2018 Investment Climate Statements: Greece
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