As elections loom large, Greece continues to play to its strengths – with energy and hospitality & leisure leading the charge – while the legislative process has been slowing down and some investors have adopted a holding-pattern approach, according to Papapolitis & Papapolitis Partner Evi Tsilou.
“With the first round of elections ending at the end of May, the markets are a bit explorative, as it is to be expected,” Tsilou begins. “There are, of course, areas of strong investor interest that are impervious to this – the hotel industry, for example, and the leisure sector overall.” Aside from these areas, which have been traditionally strong for Greece, she stresses that the energy sector is performing rather well, too, with investors primarily looking for opportunities in photovoltaics.
With business sectors doing well and the economy, consequently, booming, Tsilou believes that Greece is looking at a good rest of the year. “What we see as lawyers, right now, is that there is enough market activity to keep the economy going strong. And we expect this to be picking up even more after the elections pass, and those investors that have applied a wait-and-see approach start kicking it into gear,” she says.
However, some areas are going a bit slower, in terms of legislation, mainly because of the upcoming elections. “For a while now, Greece has been looking at a restructurings tax reform package, following the restructurings corporate reform that took place in April 2019, but it looks likely that this will be stalled until after the elections,” Tsilou continues. “When this package does pass, it is likely that almost all previous tax incentive legislation will be abolished, to reflect the changes of the corporate legal framework concerning restructurings and transformations.”
“The new restructurings corporate law has created room for more restructurings, which is exactly what we are seeing these days – and a lot of them,” Tsilou says. “The law integrates all kinds of corporate transformations and restructurings into one act, meaning that a number of transformations that were scattered across many documents before are now regulated by one source,” she explains. The new law reinforced and extended the notion of universal succession, she points out, meaning that “all ‘new’ legal entities, coming about as a consequence of a corporate transformation, are automatically in the same position as the ‘old’ company was – continuing in its place for all transactions, relationships, and licenses.”
In conclusion, Tsilou says that, until the elections pass, not a lot is likely to change in this direction in Greece. “Depending on the agreements between political parties, it remains to be seen what the structure of the new government will look like, but – if the polls are anything to go by – not much is likely to change. The new government will likely be the same, which means there is a high likelihood of business continuing as usual in Greece.”
