GREECE Law and Practice Contributed by: Betty Smyrniou, Bahas, Gramatidis & Partners
3.1.8 Syndicated Loans The concept of agency and the role of an agent (such as the facility agent) under a syndicated loan is rec - ognised only by the bond loan legislation. Τhe Société Anonyme Company Law provides that, if a bond loan is governed by foreign law, collateral security and guarantees are granted in the name of the person who, under the law governing the bond loan, may hold securities and guarantees on his/her account on behalf of the bondholders. 3.1.9 Debt Subordination All forms of subordination are known in Greece. The subordination usually takes the form of an agree - ment between secured and unsecured creditors of a borrower entity. 3.1.10 Transfer/Assignment of Debts Under Foreign Laws The transfer or assignment of all or part of an out - standing debt under an English or New York law-gov - erned loan is permissible and recognised on the basis of the applicable law. 3.1.11 Usury/Interest Limitation Laws Interest rates are not subject to a legal maximum; however, they should be determined according to the Bank of Greece in the context of the open market and competition rules. Limitations apply to default interest and compounding of interest. 3.2 Security 3.2.1 Typical Forms of Security and Recourse Greek law allows for the creation of a first-priority aircraft mortgage that is locally provided. Once the mortgage has been registered in the aircraft register, the creditor has the right to seize and sell the aircraft in the event of default. 3.2.2 Types of Security Not Available There are no types of security that cannot be taken over an aircraft or related collateral such as engines, warranties or insurance.
3.2.3 Trust/Trustee Concepts With the exception of the Greek bond loan structures, the concept of a trust and the role of a security trustee are not recognised; instead, parallel debt structures should be used. The parallel debt structure allows the debtor to undertake to pay the agent/trustee, as the creditor, an amount equal to the total amount owed to the creditors. 3.2.4 Assignment of Rights to an Aircraft by a Borrower to a Security Trustee A borrower may assign its rights to an aircraft or under an aircraft lease (including in relation to insurances) to a foreign security trustee, pursuant to a security assignment or mortgage. 3.2.5 Assignment of Rights and Benefits Without Attendant Obligations Under an aircraft lease, it is possible to assign the rights and benefits only, without also assigning the attendant obligations of the lessor. 3.2.6 Choice of Foreign Law A security assignment or a guarantee can be gov - erned by English or New York law. 3.2.7 Formalities/Mandatory Terms to Create and Perfect Security Assignments In connection with any Greek law security assignment, a notification of the third-party debtor is necessary to prevent the third-party debtor from discharging its obligations by making payments to the assignor instead of the assignee. It is not necessary for a security assignment to be translated, certified, notarised or apostilled/legalised to be enforceable against a domestic party. However, if legal proceedings are initiated before a Greek court, foreign-language documents must be translated into Greek to be admissible as evidence in such proceed - ings. 3.2.8 Domestic Law Security Instruments In the case of an English or New York law-governed security assignment in respect of an aircraft regis - tered domestically, there is no need for a financier to take any additional domestic law security instrument
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