GREECE Law and Practice Contributed by: Nikolaos Koulocheris, Ioannis Charalampopoulos, Rozita Karasso and Dimitra Kotsovelou, Machas & Partners
5.5 Applicable Governance Requirements
tion, etc). Compliance costs are notably higher for REICs, which have the obligation to comply with International Financial Reporting Standards and to publish semi-annual investment sheets of their real estate assets based on the valuations of an independent valuer accompanied by the report of an auditor or audit firm, while public companies are subject to the legal framework of listed companies, which requires the publication of semi-annual financial statements and other regular financial disclosures. 6. Commercial Leases 6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time In Greece, legal arrangements that allow the temporary use of real estate without ownership include contractual arrangements such as lease and sublease agreements, loans for use (gra - tuitous grant of use), time-sharing, tenancies at will, leases with option to buy, and concessions, as well as limited rights in rem such as servi - tudes (eg, usufruct or right of habitation). These uses of real estate vary in duration and terms, depending on the agreement and the arrange - ment type. Each arrangement is governed by specific provisions in the Civil Code. 6.2 Types of Commercial Leases Here is a summary of the types of leases in Greece: Commercial/Professional Lease • Description: Leases for retail, office or indus - trial properties to businesses or professionals (par. 2, Presidential Decree 34/1995). • Duration: Minimum 3 years. • Legal Framework: Governed by the Civil Code (Articles 574 to 594) and mainly Presi -
There are no special corporate governance requirements for entities merely from investing in real estate, other than REICs, which are sub - ject to the corporate governance requirement as listed entities. However, entities that have invested in real estate in Greece must ensure compliance with the exemptions from the special real estate property tax, an annual tax which amounts to 15% of the value of the prop - erty, under the provisions of Article 15 of Law 3091/2002, which was introduced as a special anti-avoidance tax rule. Listed and other regu - lated entities including REICs qualify ex lege for the exemption from the obligation to pay spe - cial real estate tax, while business exemptions also apply for certain commercial activities, and other miscellaneous exemptions apply for chari - table, cultural, religious and educational causes. The most common exemption is the disclosure exemption, which requires, inter alia, the issu - ance of Greek tax identification numbers from all individual ultimate beneficial owners of the real estate company regardless of their direct or indirect equity interest and voting rights in the company. By virtue of Decision A. 1089/2023, the disclosure exemption has been extended to legal entities owning Greek real estate held by a foreign trust, provided that the trust is estab - lished in a jurisdiction that is not considered a non-cooperative tax jurisdiction. 5.6 Annual Entity Maintenance and Accounting Compliance The annual entity maintenance and accounting compliance costs of entities investing in real estate vary significantly depending on the port - folio of real estate owned by the entity and the type of exploitation (eg short-term residential lease, long-term commercial lease, direct opera - tion as main or non-main tourist accommoda -
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