Investment Incentives Law in Greece


The objective of the New Investment Law is to promote economic development in the country by creating regimes, strengthen investments which improve entrepreneurship, technological development, business competitiveness and regional cohesion that promote the green economy, the effective operation of infrastructure availability and the utilization of human resources in the country.

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Types of Incentives

The projects that fall under the New Investment Law provide the following types of incentives

Tax Exceptions on Profits. It must be marked that the tax exemptions incentive constitutes an income tax exemption on profits before taxes as determined on the basis of tax legislation of the entire business enterprise.

Targeted Capital Subsidizations, which constitute the donation from the State funds to cover part of the costs of the assisted project and are determined as a percentage of them.

Leasing Subsidy that constitutes the financial coverage from the State of the overwhelmed doses of financing hire that is contracted for the acquisition of new mechanical and remaining equipment and is determined as percentage on this value of acquisition that is included in the overwhelmed doses. The leasing subsidy cannot exceed a seven (7) year period.

The above investment projects can be financed with low cost loans from financial institutions which cooperate with the National Fund for Entrepreneurship and Development (ETEAN) and may be awarded individually or in combination.


Eligible Investment Projects

The eligible investment projects are divided into two categories, General Investment and Special Investment Projects.

General Investment Projects:

General Business Projects, for which the tax exception is provided in conjunction with low interest loans from ETEAN.

Technological Development Projects, which include projects concerning the technological modernization of an enterprise . These investment projects are aided by a leasing subsidy of up to 80% for existing businesses or up to 90% for new businesses. The remaining amount is funded with tax exception and low interest loans from ETEAN.

Regional Cohesion Projects, which include investment projects in productive activities that help create local competitive advantages, address local needs and regional problems in an environmentally sustainable technological approach, introduce energy saving technologies and contribute to the environmentally friendly reconstruction, rehabilitation and development of the areas of economic activity. These investment projects get a grant or leasing subsidy of 70% for existing businesses and 80% for new businesses and the rest filled with exemptions.

Special Investment Projects:

Youth Entrepreneurship Projects, which include investment projects submitted for the establishment and operation of small and very small enterprises where at least 50% of the capital is held by individuals under 40 years old who manage the company exclusively.

Major Investment Projects, which include investment projects with a total cost of at least €50,000,000. These major projects can receive one or a combination of all the incentives, on the condition that the capital grant or the leasing subsidy does not exceed 60% of the entire subsidy provided.

Integrated Long Term Business Projects, which include long term (2-5 years) integrated projects for businesses which have been in operation for at least five years. These business projects must have a minimum total cost of €2,000,000 which includes technological, administrational, organizational and business modernization development costs. Tax exception is provided for this category of investment projects.

Synergy and Networking

This category includes investment plans submitted by synergy and networking schemes aiming to implement programs. Such programs must either develop competitive business advantages, or best utilize infrastructure created with the aid of national and European financing, or contribute to the adaptation of specific and geographically defined productive activities and services towards a modern financial and technological environment.

The New Investment Law excludes investments in sectors such as steel, coal, synthetic fibers, public enterprises and also problematic enterprises. It also excludes specific business sectors such as construction of buildings, legal and accounting services, production of electrical power from photovoltaic systems, advertising, offshore organizations and agencies.

Additionally, investment projects which still fall under the provisions of the new investment law include those for the establishment, expansion or modernization of three star hotel units or hotel units which are upgraded to at least three stars. The law also covers investment projects regarding the modernization of hotel units before the expiration of six years from the commencement of operation of the hotel unit or from the date of issuance of a decision regarding an integrated investment for modernization of the hotel unit. Furthermore, investments in the health tourism sector also still fall under the provisions of the new investment law.


Eligible Expenses

Expenses which qualify for the incentives provided by the new law for qualifying investments refer to tangible and intangible assets as well as to Research and Development projects and programs.

The most important provisions are the following:

Construction, expansion and modernization of buildings, of special and auxiliary facilities and the cost of landscaping. These costs may not exceed 40% of the subsidized cost of the investment project.

The purchase and installation of modern machinery and equipment.

New leasing rentals of brand new machinery and other essential equipment. The equipment can also be acquired, if the lease includes an obligation to purchase these at the end of the lease.

Intangible assets, such as spending quality assurance and quality control, certification, supply and installation of low interest ware and system organization of the business spending on technology transfer through the purchase of intellectual property, licensing, patents, know-how or unpatented technical knowledge etc. Intangible assets must be depreciable assets used exclusively in the assisted investment to remain at the premises for at least five years and the cost does not exceed 50% of the subsidized cost of the project.


Subsidy Levels

The amount of subsidy provided to each investment project depends on the size of the qualifying enterprise (investment vehicle) and on the prefecture where the investment plan is implemented. In any case the subsidy must not exceed 50% of the qualifying cost of the investment plan. On this basis, Greece is divided into three zones based on the level of development of each prefecture.

Subsidies provided in zone A (prefecture Attica and Viotia) vary from 15% to 25% of the investment depending on the size of the enterprise

Subsidies provided in zone B (prefectures with per capita Gross National Product above 75% of the country’s average) vary from 30% to 40% of the investment depending on the size of the enterprise

Subsidies provided in zone C (prefectures with per capita Gross National Product lower than 75% of the country’s average) vary from 40% to 45% of the investment depending on the size of the enterprise.

Finally, the highest percentages are provided for investment projects implemented in islands and remote areas up to a threshold of 50% of the qualifying investment cost.


Conditions for qualification of the investment plans and evaluation criteria

Applications for the participation of investment projects in the new subsidies regime are filed in the months of April and October and at any time for Major Investment Projects.

The beginning of the implementation of the project is made after the publication in the Official Gazette of the applying decision. The beginning of the implementation of the project before publication in the Official Gazette of the decision to join in, can be done with the sole responsibility of the investor, after the qualification application to the competent authorities to evidence that the requested assistance is an incentive for an investment project. The beginning of the implementation of the project before the submission of these applications leads to the rejection of the entire project.

Enterprises which can qualify for the new regime of subsidies, must be established in Greece and have the form of a sole trader, a commercial entity/partnership or a co-operative and must maintain double entry accounting books or an income and expenses book (category B of the Code of Books and Records).

The percentage of the investor’s own participation which was provided by the old investment scheme of Law 3299/2004 remains the same, i.e. 25% of the subsidized expenses or of the investment cost in case the owner of the investment receives the subsidy of cash grant or the subsidy of tax exeption respectively.

The minimum amount of the investment is set at €1,000,000 for large enterprises, €500,000 for medium-size enterprises, €300,000 for small enterprises and €200,000 for very small enterprises. Especially for General Business Projects, the minimum amount of the investment is determined as half of the respective amounts mentioned above.


Terms of payment of the subsidies

The manner in which payment of the cash grants and the leasing subsidies is made as well as the possibility to grant an advance and the assignment of the subsidy is determined by a Presidential Decree which is to be issued following the proposal of the Minister of Economy, Competitiveness and Shipping.

A new manner in benefiting from the tax exception is provided as follows:

The enterprise may benefit from the tax exception incentive commencing from the financial period in which the decision of completion and initiation of the productive function of the investment is issued. During this financial period, the highest amount of tax exception provided should not exceed one third (1/3) of the approved amount of the tax exception.

During the following accounting period the highest amount of tax exception, including the tax exception of the first financial period, cannot exceed two thirds (2/3) of the approved amount of tax exception.

The balance of the approved tax exception is used by new enterprises within 10 financial periods and by existing enterprises within eight financial periods, following the financial period within which the decision of completion and initiation of the productive function of the investment plan was issued.

The tax exception subsidy is retained in a tax free reserve and is recorded in a special account in the enterprise’s books. It is formed based on the “tax” on the net profits declared in the enterprise’s initial tax return which was timely submitted.

For further information please contact VK PREMIUM Business Consultants at : or call us : + 30 210 6835560