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investment Greece




What is a Development Law?

Development Law is the country's most important tool for developing and attracting private investment. It is under the control of the Ministry of Development and is funded by the Public Investment Program.

Purpose

The purpose of the Development Law is to promote balanced development with respect to environmental resources and support less favored areas of the country, increase employment, improve cooperation and increase the average size of businesses, technological upgrading, the shaping of a new national branding, improving competitiveness in high value-added and knowledge-intensive sectors, moving to the value chain to produce more complex products, savings natural resources in the prospect of a circular economy, offer better services, attracting foreign direct investment and ultimately ensuring better positioning the country in the international division of Labor. The achievement of these objectives is pursued by means of the present aid, through the schemes provided for in its Specific Part, namely:

  1. extroversion and innovation,
  2. the creation of new jobs,
  3. utilization of the country's human resources, with focus on employing trained human resources, to reverse the current flow of young scientists going abroad,
  4. the attraction of foreign direct investment
  5. improving the technological level and competitiveness of businesses
Terms and conditions of affiliation

  1. Participation of an entity in the cost of the investment project
The entity can contribute to the cost of the investment project either through equity financing or external financing, provided that twenty-five percent (25%) of the total investment cost does not include any state aid, public support or benefits.

  1. Minimum amount of investment projects
The minimum amount of investment eligible for investment projects under the aid schemes, shall be determined on the basis of the size of the entity, namely:

  1. for large enterprises, in the amount of five hundred thousand (500,000) euros,
  2. for medium-sized enterprises, cooperatives and clusters of Article 52 in the amount of two hundred and fifty thousand (250,000) euros,
  3. for small enterprises, amounting to one hundred and fifty thousand (150,000) euros,
  4. for very small enterprises, in the amount of one hundred thousand (100,000) euros,
 

  1. Contents of investment plan
Investment projects, which are subject to the present aid schemes, have the character of an initial investment and in particular fulfill one of the following conditions:

  1. creating a new unit,
  2. expansion of existing unit capacity,
  3. diversification of production of a unit into products or services never produced there, provided that the eligible costs exceed at least 200% of the book value of the re-used assets as recorded in the financial year preceding the application subject to the investment plan,
  4. a fundamental change in the entire production process of an existing large enterprise unit provided that the eligible costs exceed the depreciation of the assets related to the activity to be modernized during the previous three (3) financial years.
  5. acquisition of all assets belonging to a closed business establishment that is purchased by an investor not related to the seller and excludes the mere acquisition of the shares of a business.
The beneficiaries of the devepopment law are companies which are established or have a branch in the Greek territory at the time of commencement of the investment project and have one of the following forms:

  1. individual business,
  2. commercial company,
  3. partnership,
  4. companies established or merged, with an obligation to complete the disclosure procedures prior to the commencement of the investment project
Companies whose eligible amount of investment projects exceeds five hundred thousand (500,000) euros and are subject to the aid schemes hereunder are required to obtain the legal form of a commercial company or partnership before the investment project commences operations.

Subject investment plans.

In the field of production, distribution and energy infrastructure, the investment projects are exceptionally strengthened:

Small Hydro Power Plants installed up to 15MW.

Production of heat and cooling from renewable energy sources.

Generation of Electricity from R.E.S. is Electricity coming from:

  1. Exploitation of Wind or Solar Energy or Biomass or Biogas
  2. The exploitation of Geothermal Energy, provided that the right to exploit the relevant Geothermal Resources has been granted to the person concerned, in accordance with the provisions in force at all times.
  3. Exploitation of Energy by the Sea
 

 

Exceptionally strengthened sectors in the field of storage and transport support activities:

Supply chain management services to third parties (logistic).

In the field of tourism, exceptionally, aid schemes are subject to investment projects:

  1. establishing or expanding hotel units of at least three (3) stars.
  2. expansion and modernization of a complete form of hotel units that have been discontinued, provided that the use of the building has not changed during the interruption period and that by the extension or modernization of the integrated form they have been upgraded to at least three (3) stars.
  3. the establishment, expansion and modernization of an integrated form of Tourist Organized Camps (camping) , belonging to or upgrading to at least three (3) stars.
  4. establishment and modernization of a complete form of hotel units within designated traditional or listed buildings belonging to or upgrading to at least two (2) stars.
  5. Special Tourist Infrastructure facilities: conference centers, golf courts, tourist ports, ski resorts, theme parks, therapeutic tourism facilities [therapeutic units, thermal tourism centers, thalassotherapy centers, resuscitation centers, spa, coaching sports tourism centres, mountaineering shelters, motorways.
Enterprises whose investment plans are implemented in one of the sectors of Technology, Information Technology, Communication (ICT) and agri-food (processing, packaging and marketing of agricultural products), as their main activity.

Eligible Expenditure

Tangible assets

  1. Construction, extension, modernization of building installations and special and auxiliary building installations and the configuration of the surrounding space. Taken together, they may not exceed 45% of the total eligible costs. For investment projects in the tourism sector the rate is 60% for building costs, while for investments in Logistics it is 70% for the construction costs of these investment projects. Finally, for buildings classified as preservable, this rate is 80%.
  2. Purchase of all or part of existing fixed assets for SMEs under conditions.
The purchase of all existing fixed assets (buildings, machinery and other equipment), or part of the assets of a production unit, for assisted SMEs directly linked to a production unit, provided that the following conditions are met:

  1. this unit has shut down,
  2. the purchase is made by the seller of the non-seller investment,
  3. the transaction is made under normal market conditions
  • Purchase and installation of new up-to-date machinery and other equipment, technical installations and inland transport vehicles.
Intangible assets

  1. technology transfer through the acquisition of intellectual property rights, licenses, patents, know-how and unregistered technical knowledge,
  2. quality assurance and control systems, certifications, procurement and installation of software and business organization systems.
The following expenditure is not supported:

  1. operating expenses of the investment,
  2. the purchase of passenger cars up to six (6) seats,
  3. the purchase of office furniture and utensils, unless they are part of the hotel equipment,
  4. the purchase of land, land and parcels. In the case of the purchase of building installations, part of the expenditure relating to the value of the land on which they have been erected cannot be increased,
  5. the contribution to the equity of machinery and other fixed assets,
  6. the erection or extension of building installations on land not owned by the investment entity unless this has been granted by the State or the public sector body or has been leased for that purpose for at least fifteen (15) years by date of issue of the decision on affiliation.
According to the provisions of Law 4399/16 the maximum aid amounts to 55% of the total budget of the investment project, according to the limits of the Regional Aid Charter, depending on the place of implementation of the investment.

Eastern Macedonia - Thrace 55%

Central Macedonia 55%

Thessaly 55%

Epirus 55%

Western Greece 45%

Peloponnese 55%

Northern Aegean 55%

Western Macedonia 45%

Ionian Islands 45%

Crete 45%

Central Greece 40%

Attica 30% - 40%

South Aegean 40%

Ε.g: The creation of a new hotel unit in Santorini can receive a 28% cash subsidy (70% * 40%).

In special cases, as defined by Section 12 of Development Law 4399/16, the NAMME scheme gives a cash grant rate of 100% of the maximum aid rate of each Region. (companies whose investment plans are implemented in one of the fields of Technology, Information Technology, Communication (ICT) and agri-food, as their main activity) (companies whose investment plan is implemented in specific areas, which are listed in the relevant annex - mountainous area, border area etc.)

Under this scheme there is also a ceiling for aid per project submitted and this amounts to 5,000,000€.

Submission of investment plans, excluding major investments, requires a fee set at 0.0005 of the eligible amount of the investment plan. In any case, the above amount may not be less than three hundred (300) euro and no more than five thousand (5,000) euro.

It is important to have your own participation (cash) certificate from a bank one month before submitting the proposal so that we have a chance to approve the investment plan.

Applications for affiliation can be made by interested parties through the State Aid Information System until Tuesday 15.10.2019. It will probably be extended for at least 2 months.

It takes approximately 2-3 months from the submission deadline to approve or reject an investment plan.

The first payment can be made once at least 25% of the investment is covered. The second payment request is made once the completion of at least 50% and the balance upon completion of the investment.

The time limit for completion of approved investment plans shall be specified in the entry decision and may not exceed three (3) years from the date of publication of the approval decision. Subject to conditions (such as 50% of the investment project), the approved implementation time may be extended by up to two (2) more years. There is a time limit for the commitment and retention of the investment for 3 years from its completion.