GREECE Trends and Developments Contributed by: Panagiotis (Notis) Sardelas, Matina Kagkelari and Anna Zlatoudi, Sardelas Petsa Law Firm
Underlying assets Although the provisions of Greek Law 5072/2023 did not amend the Securitisation Law, certain of its provisions are considered to apply to securiti - sation transactions in parallel. Indicatively Article 21, paragraph 6 of Greek Law 5072/2023 pro - vides that if the loans included in a portfolio are NPLs of consumers (ie, individuals acting out - side their business activity) granted in Greece, the transfer to loan acquirers is conditional on the debtors and guarantors (i) having been invit - ed extrajudicially within a period of 12 months before the sale offer to settle their debts, and (ii) having settled their debts, based on a written proposal for an appropriate arrangement with specific repayment terms, in accordance also with the Code of Conduct, a procedure estab - lished by Greek Law 4224/2013, as revised by the Bank of Greece’s Credit and Insurance Committee No 392/1/31 May 2021. The sec - ond condition regarding “settlement of debts”, which was not included in previous Greek Law 4354/2015, sets a stricter eligibility criteria, in a way that a consumer NPL can only be trans - ferred either if it is settled or if the attempt for its arrangement has failed. This requirement does not apply in cases of (i) receivables under court proceedings; (ii) receivables on which a final judgment has been issued; and/or (iii) in cases in which the debtors have been classified as “non-cooperative” in accordance with Article 1, paragraph 2 of Greek Law 4224/2013 (ie, when the debtors failed to provide information, co- operate with the institution, accept any financial solution or counter-propose an arrangement for their debts). Other developments Single electronic registry Recently passed Greek Law 5123/2024 estab - lishes an effective, simple and transparent legal framework for the execution and registration
The Latest Developments in Greek Securitisation Law Servicing landscape
Greek Law 5072/2023, enacted in December 2023, introduced some new provisions on ser - vicing, which transformed the servicers’ indus - try. The stricter regulatory framework and the technical requirements provided by such law resulted in the industry’s shrinkage, with some servicers either failing or withdrawing from the relevant Bank of Greece’s licensing procedure. Furthermore, strict regulatory requirements applied to debt refinancing, namely granting of new loans and new liquidity to corporate entities, resulted in none of the domestic servicers being licensed to provide such services, whereas less than 50% of the domestic servicers have the right to receive payments according to Article 7 of Greek Law 5072/2023. Given that both Greek Law 3156/2003 (the Securitisation Law) and Greek Law 5072/2023 allow transactions where the underlying assets are performing loans, the legislator’s choice to restrict the servicers’ activi - ties to debt refinancing only would lead the par - ties to focus on non-performing loans (NPLs) portfolios in order to avoid a forthcoming dead- end with the borrowers of performing loans, the loan amount of which is not fully drawn. Furthermore, Article 115 of Greek Law 5072/2023, adopting Decision 1/2023 of the Greek Supreme Court ( Areios Pagos ), resolved any doubt on licensed servicers’ authorisation, under the Securitisation Law, to conduct court and enforcement proceedings in order to collect the claims under their servicing, providing that each servicer’s authorisation is fully evidenced by the registration certificates referred to in para - graphs 8 and 16 of Article 10 of the Securitisa - tion Law, and no other document or action is needed (eg, the registration of the full servicing agreement).
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