NEW INVESTMENT LAW 2601 / 1998
(The following text includes Selected abstracts and
in no way can be considered as a substitute to the law)

1. INVESTORS:

The new Investment law discriminates the investors into the following two categories:

«New» Investors: Corporations which have not been yet constituted, or have been constituted within a period of less than 5 years from the submission date.

«Old» Investors: Corporations which have been constituted at least 5 years in advance of the submission date.

For «new» investors the alternative incentives are:

either i) cash grants and interest subsidies for bank loans as well as leasing

subsidies

or ii) tax allowances and interest subsidies for bank loans

For «old» investors, the only applicable incentives are tax allowances and interest subsidies for bank loans

 

2. ZONES:

For the application of the above incentives, Greece is divided into 4 zones, as follows:

ZONE D: Prefectures of Xanthi, Rodopi, and Evros, the Norhtern Aegean islands, Thasos island, the prefecture of Dodecanese except for the city of Rhodes, all areas within 20km from the border and ETVA industrial Zones of the Epirus’ region.

ZONE C: Areas of Greece with acute problems of unemployment and/or population reduction. These areas shall be defined by the Ministry of National Economy by a future degree.

ZONE B: Some areas of Attica and Thessaloniki (i.e. the ETBA industrial Estate), and all other areas that are not included in zones C, D, A.

ZONE A: Prefectures of Attica and Thessaloniki, except for their parts that may be included in zones B or C.

In the diagram 4, the prefectures mentioned above are shown.

 

3. INCENTIVES:

The incentives for the above zones are as follows:

A) "New» investors"

either:

Zone

Cash Grant Loan interest subsidy Leasing subsidy

D

40%

40%

40%

C

30%

30%

30%

B

15%

15%

15%

A

-

-

-

or

Zone

Loan interest subsidy

Tax allowance

D

40%

100%

C

30%

70%

B

15%

40%

A

-

-

B) “Old” investors

Zone

Loan interest subsidy

Tax allowance

D

40%

100%

C

30%

70%

B

15%

40%

A

-

-

C) Exceptions

Zone

Cash Grant Loan interest subsidy Leasing subsidy

D

40%

40%

40%

C

40%

40%

40%

B

30%

30%

30%

A

25%

25%

25%

or

Zone

Loan interest subsidy

Tax allowance

D

40%

100%

C

40%

100%

B

30%

70%

A

25%

60%

Finally, there is a provision for special incentives for various kinds of special investments. Additionally, there is a provision for special incentives for special zones, industry sectors or companies (to be determined).

 

4. LIMITATIONS:

The cash grant and the allowance for leasing cannot exceed the amount of 15.000.000 GRD per job creation by the investment. This limitation is not valid for the following investments:

The own participation of the investor cannot be lower than 40% of the investment

 

5. INVESTMENTS ABOVE 25 BILLION GRD (80 MILLION USD):

In the case of investments in industry and tourism of at least 25 bn GRD with the creation of at least 300 permanent jobs, all types of incentives are alternatively applicable. Also divergences can be made from the limitations in the own participation, the submission deadlines, the procedure for the award of the grants, the size of the grants, the interest subsidy (duration and percentage), the maximum amount of the bank loan, the percentage of tax allowances and allowances in the leasing of equipment, the conditions of company shares’ transfer, as well as the possibility of public corporations participating in the investment.