GREECE Law and Practice Contributed by: Aris Papaspyridis, Virginia Kokios and Konstantinos Kounelis, AP Legal
2. Establishing and Exiting Early- Stage Companies in the Energy and Infrastructure Industry 2.1 Establishing and Financing a New Company The energy and infrastructure industry is a regulated market in Greece, particularly in renewables, stor- age, and infrastructure development. In order to have flexible equity participation and potential conversion during later-stage financing, either a société anonyme (SA) or a private company (PC) should be the chosen vehicle. In Greece, new companies are typically incorporat- ed under the General Commercial Registry ( Genikó Emporikó Mitróo , or GEMI) ‒ through which, the entire process can be completed electronically. The proce- dure is efficient and straightforward, with incorpora- tion generally finalised within a few days. Key considerations include licensing, permits, and grid-connection rights. Investors treat these as mile- stones in terms of valuation and financing. 2.2 Liquidity Events In Greece, companies in the energy and infrastructure sector typically experience liquidity events through the sale of licensed projects or equity transfers to larger investors once the necessary permits or grid-connec- tion rights have been secured. This is a common exit strategy for small and medium-sized developers, who often capitalise on value creation during the licensing phase rather than proceeding to full project construc- tion. If a company is unable to obtain the required regulatory approvals – such as the environmental terms approval ( apófasi égkrisis perivallontikón oron , or AEPO) or a grid connection – and therefore cannot complete or operate the project to generate revenue, it may face liquidity constraints. Consequently, developers and investors must pay particular attention to the timely acquisition of permits, project financing, and regula- tory compliance, as these remain the decisive factors for ensuring project viability and investor returns.
Key considerations include the corporate form of the entity, the signed shareholders’ agreements, and change-of-control clauses.
3. Spin-Offs 3.1 Trends: Spin-Offs
In Greece, it is customary in the energy and infrastruc- ture space for companies to proceed to spin-offs. There are three types of splits: common split, partial split and division spin-off. A key driver for considering a spin-off is the gen- eral organisation of the company’s economic activ- ity. Rather than holding all the electricity production/ storage licences itself, a company may decide that it is in its best interest to set up companies (SPVs) to which these licences will be transferred, so that these SPVs will bear the rights and obligations associated with these licences instead. The incentive for doing this is that, should a licence ultimately fail financially, the problem will be with the SPV and not the parent company. 3.2 Tax Consequences When a split or a spin-off takes place, a certain set of rules applies. Rules for the valuation of assets apply in the same way in the event of a split or a spin-off. If the assets of the transferring company need to be valued, this valuation does not affect the taxable value that the assets will have in the recipient company. Rules for the valuation of corporate holdings vary in the event of a split or a spin-off. The timing of the completion of the split or the spin-off is crucial for tax purposes and, if the company shares are trans- ferred within two years of the completion date of the split or the spin-off, then their acquisition price will be determined based on their market value at the time immediately preceding the split or the spin-off. Rules for the taxation of goodwill differ depending on whether a split or a spin-off occurs. The goodwill arising from a split does not give rise to a tax liability for the recipient company. Conversely, in the event of
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