GREECE Law and Practice Contributed by: Stefanos Charaktiniotis, Danai Falconaki, Stathis Orfanoudakis and Nadia Axioti, Zepos & Yannopoulos
or as sole shareholders/partners of companies with the same purpose, unless special permission has been granted by the general meeting or the com - pany’s articles of association. Under Greek law, a director is liable only vis-à-vis the company for any default (either wilful misconduct or negligence, including slight negligence), namely any act or omission that took place during the manage - ment of corporate affairs that was harmful to the com - pany. The director’s liability vis-à-vis third parties may be on the basis of tort if it is established that an illegal act or omission has a direct causal link with damage sustained by the third party, including moral damages. This liability may apply where the company’s suppli - ers, employees, shareholders or the Greek state are concerned. 8.2 Special or Ad Hoc Committees The establishment of special or ad hoc committees in business combinations by the board of directors is not very common in Greece. The Hellenic Federation of Enterprises has also issued the Code of Corpo - rate Governance, which is not mandatory for compa - nies but rather constitutes “soft law”. The code pro - vides that companies admitted to a regulated market should, in addition to the board, establish an audit committee to audit financial information, operate the internal audit of the company efficiently, handle risk management and audit the independence and objec - tivity of the auditors of the company. As noted above, under Greek law there is in any case a requirement for directors to disclose conflicts of interest and to refrain As a general rule, not applying merely to takeover situ - ations, a director’s liability towards a company shall not exist if the director proves that they demonstrated the diligence of a prudent director operating in similar circumstances and thus met the requirements of the “business judgement rule” in the performance of their duties, taking into consideration their particular skills and capacities, their respective position and/or the duties that were assigned to them. Having said that, liability does not exist, under the “business judgement rule” test, where acts or omissions: (i) were performed on the basis of a lawful resolution of a general meeting from voting on any such matters. 8.3 Business Judgement Rule
of shareholders; or (ii) constitute a reasonable busi - ness decision that was reached in good faith in order to further the corporate interest, based on sufficient information available at the time. 8.4 Independent Outside Advice When it comes to business combinations, directors can be supported by a wide range of advisers. Indica - tively, these can include financial, legal, tax and tech - nical advisers engaged during different stages of the transaction and depending on the specific needs. For example, Law 4601/2019 on corporate transforma - tions provides that, in the case of a merger, demerger or spin-off, the draft transformation deed needs to be examined by one or more independent experts (such as certified public accountants, auditing firms, etc), who will then need to produce a written report thereon addressed to the company, while where required by law, a valuation report for the assets of the entities involved must be undertaken by independent char - tered auditors or an audit firm to be appointed by the board. 8.5 Conflicts of Interest A conflict of interest is specifically regulated under corporate law, while directors are obliged to timely and duly disclose to the other board members any personal interest or interests of their close family which may arise from the company’s transactions and which fall within their duties, and to abstain from voting on issues with a potential or factual conflict of interests. Although conflict of interest can very often substantiate a claim challenging the validity of a cor - porate decision or appointment before the court, it is not de jure scrutinised by a pertinent authority.
9. Defensive Measures 9.1 Hostile Tender Offers
Hostile tender offers are permitted under Greek law but are rather uncommon in the Greek M&A land - scape, mainly due to the size of the companies and the level of sophistication of the market. 9.2 Directors’ Use of Defensive Measures Law 3461/2006 does not allow directors to use defen - sive measures within a mandatory or voluntary ten-
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