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EC Introduces Further Measures to Boost International Business

Publiziert am 2.August.2013 von Abraam Kosmidis

Lawyers provide a professional source of expertise that will be beneficial to most businesses during their operational lifetimes, whether it is to do with the start-up of their business, employment law related issues, debt recovery or registering a patent or trade mark.

Expert legal advice becomes even more important when a company is looking to conduct business in another country, such as Greece, where the legal requirements may be different from the organisation’s home country and local professional knowledge is essential to avoid falling foul of any of these unfamiliar laws.

Understanding local tax laws

One area that could prove very costly for businesses to get wrong when operating overseas is that of tax law. The rules and regulations relating to business taxes can vary from country to country, and companies can find themselves facing severe financial penalties if they misinterpret their liabilities and fail to pay the correct amount of tax at the required time.

Local expert knowledge is invaluable when it comes to ensuring that national law is complied with. In Greece, the lawyers at Kosmidis & Partners have in-depth working knowledge of Greek tax law and can advise overseas businesses on their tax liabilities for any operations that take place in Greece.

The payment of the correct tax is a concern for all European countries, including Greece, and the European Commission (EC) has recently taken action to tackle the problem of tax evasion and avoidance by setting up its ‘Platform for Tax Good Governance’.

The purpose of the Platform is to track the progress of each Member State in meeting Recommendations set out by the Commission last year, including:

  • Taking a strong stance against tax havens over and above the existing international measures, by identifying existing tax havens and putting them on national blacklists.
  • Aggressive Tax Planning, which suggests ways of blocking off openings used by companies to avoid paying tax, such as strengthening the anti-abuse provisions in bilateral tax treaties and the use of both national and EU corporate legislation. Under this recommendation, Member States are advised to ignore any artificial arrangement put in place by companies for the purposes of tax avoidance and instead to tax these companies based on actual economic substance.

„In battling tax evasion, we are battling to protect the fairness of our tax systems, the competitiveness of our economies and the solidarity of our Member States,” explained Algirdas Šemeta, Commissioner for Taxation, Customs, Statistics, Audit and Anti-Fraud.

“There is too much at stake for this battle to be lost. The renewed vigor amongst Member States to take up this fight is more than welcome. It must now be channeled into action,” he added.

Overseas companies operating in Greece are advised to contact the lawyers at Kosmidis & Partners for expert advice on how corporate tax liabilities are affected by both the country’s national laws and European regulations.

Greece improves global rankings

As a country, Greece continues to benefit from direct intervention from Europe that has been designed to boost the country’s trade prospects and wider economy. In June of this year, the European Investment Bank agreed to provide up to €500 million in trade financing to support small and medium sized companies (SMEs) in Greece in their international trade operations.

These interventions, together with internal improvements made by the country’s governing authorities themselves, are having a very positive impact and increasing Greece’s attractiveness as a destination for international business. So much so in fact that the 2013 Doing Business report from the World Bank Group, which tracks the impact of regulatory reform on business in 185 different economies, found that the improvements to its business climate have been so successful that Greece is included in the list of the ten most improved countries globally for 2011/12.

Facilitating the management of business insolvency

Another recent European development that could potentially affect overseas businesses operating in Greece relates to the issue of business insolvency. Member States have very different rules and regulations governing this subject, and this divergence can have a negative impact on cross-border trade and investment.

The EC recognises how difficult it can be for businesses to remain prosperous in these difficult economic times. Figures from the EC show that as many as 200,000 businesses go bust every year across the EU on average, and up to 25% of these bankruptcies involve an element of cross-border operations.

In December 2012 the EC published details of proposals to reform insolvency laws, and committed to look further at the problem of how best to manage business failure across Europe in light of the fact that different national laws were so diverse on the subject.

As a follow up to this commitment, the EC has now launched a consultation on a common European approach to business insolvency, which seeks views on a number of important issues, including:

  • Harmonizing the “time to discharge” (how long it takes to close a business that has failed), which can have a significant impact on whether the business can be restarted. This timing currently varies widely across the EU from four months to as much as six years, and some countries make no provision at all for a failed entrepreneur to ever obtain a discharge.
  • The rules that control the exercise of the profession of liquidators.
  • Whether problems are created by the current rules governing the duties and liability of directors in insolvency.
  • Whether EU rules are required to ensure that fraudulent managers who are disqualified from managing a company in one country are also automatically prevented from doing so in another Member State.

The consultation also asks “whether the legal uncertainty arising from the different conditions under which an act of an insolvent debtor which is detrimental to their creditors can be avoided before national courts has created problems in practice.”

Debt recovery and insolvency is a serious matter in Greece, as with the rest of the EU, and the correct interpretation of the different rules and regulations can have important implications for businesses operating in Greece.

Contact Kosmidis & Partners law firm today for expert professional advice from our English speaking lawyers on any disputes relating to these subjects, or for any other legal issue that might arise through overseas business operations in Greece.



Greece Opens Its Doors to Overseas Business

Publiziert am 27.Mai.2013 von Abraam Kosmidis

Improvements in the European economy and recent internal developments within Greece suggest that now would be a good time for overseas companies looking to set up a business in Greece to start taking steps to bring these plans to fruition.

KPAG Kosmidis & Partners is a Greek law firm with lawyers who specialise in working with English-speaking businesses in Greece. Our lawyers are ideally qualified to help and advise international companies as they go through the process of establishing trade links with Greece, or setting up business operations within the country.

Positive economic picture

There are currently encouraging economic signs across the European Union, with recent figures released by the European Commission (EC) suggesting that the EU economy is starting to come out of the recession that was so dominant and damaging throughout 2012. Predictions are that the economy across Europe will stabilise in the first six months of 2013, with GDP growth starting to turn positive in the latter half of the year and then continuing to gain ground into 2014.

EC initiatives target Greece

As a business destination, Greece has recently been the focus of a great deal of attention from the EC. A recent EC initiative has seen the representatives of more than 138 European companies come to Greece to meet with Greek owners and managers of small and medium sized enterprises (SMEs) about the prospects for future collaborations, including ventures such as trade partnerships, investment, and joint undertakings.

The EC notes that SMEs in Greece have faced a number of difficulties in the last few years; however the Greek government has implemented a number of reforms that have had a positive effect on the Greek economy and business opportunities within Greece.

Greek labour market

One of the areas targeted by reforms is the Greek labour market, which has historically suffered from high unemployment rates, caused in part by a rigid wage structure that was not in line with worker productivity. The Greek Government has attempted to tackle this problem through a number of reforms, including creating opportunities for firm-level pay agreements and reductions in minimum wages.

This improved labour market increases Greece’s appeal as a business destination, but there are undoubtedly a number of challenges involved in employing staff in an overseas country. Therefore, any foreign company looking to operate in Greece is advised to take advice from professional Greek lawyers to ensure they do not fall foul of any employment laws or regulations. Kosmidis & Partners Law Firm has lawyers who are highly experienced in Greek labour law and are available to advise all foreign businesses on any legal obligations with regard to their staff in Greece.

Greece looking to establish trade links

According to EC figures, Greek exports look set for another good year, making 2013 the fourth year in a row where exports have grown. The Greek Foreign Trade Board apparently has over 60 different trade initiatives organised for 2013, including the participation in a number of international trade fairs.

Through these initiatives, Greece is opening its doors to businesses looking to expand their international markets. At Kosmidis & Partners, our lawyers are ready to advise you in all aspects of doing business in Greece, including:

  • Setting up a limited liability company
  • Mergers and acquisitions in Greece
  • Greek competition law
  • Debt recovery, and
  • Tax law

The improving economic situation in Greece has not gone unnoticed. In a recent report produced by the World Bank on doing business in Greece, the country’s ranking improved from 89 to 78, a rise of 11 places, placing Greece in the top ten reformers worldwide.

European right to freedom of movement

As well as continuing to make its own internal reforms to increase foreign and domestic business opportunities, Greece, like all other EU Member States, continues to be subject to new laws and amendments coming from the EC and the European Parliament that are designed to reduce barriers to trade.

The EC has recently proposed a new measure to improve the application of EU law on people’s right to work in another Member State.

According to EC figures, there were 6.6 million EU citizens living and working in a Member State other than their own in 2012. A further 1.2 million people apparently live in one EU country while working in another.

However, people working in another country can face a number of difficulties, and a Eurobarometer poll carried out September 2011 found that around 15% of EU citizens wouldn’t want to work in another Member State because there are too many obstacles to overcome. These obstacles include issues such as:

  • Differing recruitment conditions.
  • Access to certain posts is restricted by nationality conditions.
  • Differing working conditions in practice (such as pay and future career prospects).
  • Non-recognition of professional qualifications and experience acquired in other Member States.

EU legislation already exists to tackle these issues, but is not always adequately implemented in all Member States. The EC’s proposal would address this problem by requiring Member States to take a number of steps to improve the implementation of EU law.

László Andor, Commissioner for Employment, Social Affairs and Inclusion, described the free movement of workers across the EU as a key principle of the EU’s Single Market.

“Labour mobility is a win—win – it benefits both Member States‘ economies and the individual workers concerned,” he explained. “This proposal will help workers to overcome obstacles to working in another EU country.“

Overseas companies that have set up business in Greece will usually have a number of options when it comes to staffing these businesses. One option could be to recruit local staff to work for them, or alternatively, the company could look at transferring staff from other office locations to work in its Greek operations.

The prospect of negotiating another country’s rules and regulations relating to the recruitment and employment of staff can at first appear rather daunting for companies, but using local Greek lawyers can help to make the whole process much more straightforward.

The lawyers at Kosmidis & Partners are highly experienced in all aspects of Greek business and labour law, and will be able to guide overseas businesses through all the necessary steps involved in setting up a local base of operations in Greece and employing the necessary staff.