Company Law and the Establishment of Enterprises

As a result of the right to free residence, there has been a notable increase in the translocation of businesses and the launching of new companies in all EU Member States. The exercise of this right is further asserted by a Directive on the entrance and residence in the receiving countries. Regrettably enough, the company laws of countries in the EU has not been modified accordingly to reflect these new conditions.

The above changes have led to the creation and proliferation of manifold national diversities in each Member State which must be taken into account when providing advice in cases concerning company establishment and translocation, choice of suitable company form. The taxation of companies abroad must also be given serious consideration and to this effect, our firm offers advice on general matters concerning tax law to businesses which intend to form companies or to settle in Greece.

According to Article 10 of the Greek Civil Code, a legal transaction of a company is evaluated according to the law of the location of the de facto seat. A foreign business is one which does not have its seat in Greece. Domestic businesses are those that are formed subject to Greek law and are located in Greece. The Greek general and limited partnerships ("omorrithmi" and "eterorrithmi" firms) and dormant companies, the companies of limited liability (Greek “EPE”) and enterprises are all liable to corporate income tax.

While domestic companies are subject unlimited to taxation, foreign companies are subject to corporate income tax regardless of their legal form, so long as their net profits derive from the exploitation of Greek resources. Meanwhile, a German-Greek agreement, for example, may be entered into to offer relief from double taxation.