GREECE Law and Practice Contributed by: Betty Smyrniou, Bahas, Gramatidis & Partners
Completion of the ownership transfer and registra - tions can usually occur within the same day, depend - ing on the aircraft’s/engine’s location. 1.2.5 Taxes/Duties Payable Upon Execution of a Bill of Sale Usually, VAT obligations are not applicable if the air - craft is located abroad or in Greece and the lessee has VAT exemption. If the aircraft is located in Greece at the time of the transfer of title (ie, at the time of execution of the rel - evant bill of sale), and the lessee is entitled to VAT exemption, the HCAA will enter the transfer of title in the register – provided a copy of the exemption cer - tificate obtained by the lessee from the competent tax office is attached to the bill of sale. However, if the lessee is not entitled to VAT exemption, the seller will have to secure a taxpayer registration/ VAT number in Greece, and the sale must be made subject to the corresponding VAT rate. The HCAA will enter the transfer of title in the register, provided the bill of sale includes the seller’s Greek taxpayer reg - istration/VAT number, the relevant tax office, the tax representative (if any) and the corresponding VAT. The HCAA must immediately give notice of the transfer of title to the tax office that issued the foreign seller’s Greek taxpayer registration/VAT number. If the aircraft is located outside Greece at the time of the transfer of title, such transfer of title will not be subject to tax in Greece, and the contracting parties will need to examine any VAT-related obligations in the country where the aircraft is located. In order for the transfer of the title to the aircraft to be entered in the Greek Registry, a document (eg, issued by the airport where the aircraft is parked or any other authority) cer - tifying the location of the aircraft at the time of transfer of title must be produced. The HCAA must give notice of the transfer of title to the lessee’s tax office, provid - ing information about the identities of the seller and the buyer and the place where the aircraft was located at the time of title transfer. Under the framework of Council Regulation 904/2010, the relevant tax office will relay this information to the tax authorities of the EU member state where the aircraft was located at
the time of title transfer, clarifying whether the lessee qualifies for exemption. This process also applies when one or both of the contract parties are tax-liable entities based in Greece. The sale of an ownership interest between foreign persons in a foreign entity that owns an aircraft or engine – including where title to such aircraft or engine is transferred while it is located in Greece or in tran - sit – does not in itself create any Greek tax obliga - tion regarding the aircraft or the engine owned by the entity. All types of operating/wet/finance leases or leases concerning only engines or parts are generally per - missible and recognised. 2.1.2 Application of Foreign Laws Foreign law may apply to a lease involving either a domestic party or an asset situated in Greece. 2.1.3 Restrictions Concerning Payments in US Dollars No material restrictions are imposed on domestic les - sees making rent payments to foreign lessors in US dollars. 2.1.4 Exchange Controls There are no exchange controls that could prevent rent payments. Greece’s foreign exchange market conforms to EU rules on the free movement of capi - tal. Controls only exist to facilitate the enforcement of AML/CFT laws. Since 1 January 2001, Greece has been part of the Eurozone, and all transactions have been conducted in euros since 1 March 2002. 2. Aircraft and Engine Leasing 2.1 Overview 2.1.1 Non-Permissible Leases There are no restrictions or difficulties when convert - ing, repatriating or transferring funds associated with proceeds. Although capital controls were imposed in late June 2015, these have since been lifted.
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