Development Law
“Greece Strong Growth”

LAW No. 4887/2022

The new development law titled “Development Law – Greece, Strong Growth”, defines the conditions for inclusion of investment projects and the framework for the establishment of schemes for the granting of state aid.

The most important innovation of the new framework relates to the time that will be required for the assessment and audit of the investment projects. It will now take no more than 60 days from the submission of an investment project until its assessment and inclusion in the relevant scheme.

Purpose

of the law is to promote the economic development of the country by providing incentives for specific activities and sectors so that the following are achieved:

Digital and technological transformation of companies

Green transition

Creating economies of scale

Supporting innovative investments and for those seeking the introduction of new technologies of “Industry 4.0”, robotics, and artificial intelligence

Strengthening employment with specialized staff

Supporting new entrepreneurship; - strengthening of less favoured areas of the country and areas included in the Fair Development Transition Plan (SDAM)

Further strengthening the tourism industry

Improving competitiveness in high value-added sectors

Digital and technological transformation of companies

Green transition – environmental upgrading of businesses

New Business

Fair Development Transition Scheme

Research and applied innovation

Agri-food – primary production and processing of agricultural products – fisheries and aquaculture

Processing – Supply chain

Business extroversion

Aid for tourism investment

Alternative forms of tourism

Large investments

European value chains

Entrepreneurship 360ο

The new Law establishes

13 schemes for granting State aid to investment projects

which may fall into the following categories:

Investment projects subject to the law may receive aid for eligible

Costs

That are of regional nature for initial investment, or an independent grant, or shall be granted in combination with non-regional aid under other sections of the General Block Exemption Regulation (EU) No. 651/2014 and other Regulations of the European Union; or

that are of non-regional nature, granted from other sections of the General Block Exemption Regulation and other Regulations of the European Union

Please note that in accordance with Article 4:

Regional investment aid is that defined in Articles 13 and 14 of the General Block Exemption Regulation, granted for an initial investment or an investment in favor of new economic activity according to the Regional Aid Map referred to in Article 2, para. 41, point 14 of the General Block Exemption Regulation; and

Non-regional investment aid is that granted for non-regional investment projects or investment costs

Expenditure Eligible for Regional Aid

Tangible Assets

Intangible Assets

Wage costs arising from new employment

Expenditure Eligible for non-Regional Aid
In addition to regional aid, grants may be provided under other special categories of eligible costs such as:

Investment costs for consulting services provided to small and medium sized enterprises (SMEs)

Start-up costs for start-ups and small and very-small sized enterprises

Costs for research and development projects

Innovation expenditure for small and medium-sized enterprises (SMEs)

Expenditure on procedural and organizational innovation for SMEs and Large Enterprises

Investment costs for environmental protection

Investments costs for energy efficiency measures

Investment costs for the cogeneration of high efficiency energy from RES

Expenditure for generating energy from renewable sources

Costs for installing efficient district heating and cooling systems

Costs for remediating contaminated sites

Costs for recycling and reuse of waste

Expenditure for vocational training

Aid for the participation of SMEs in trade fairs

Aid for disadvantaged employees

Aid recipients (beneficiaries)

are the investment entities that are established or have a branch in the Greek Territory at the time of the commencement of activities under the investment project, and have one of the following forms:

Commercial company

Cooperative

Social Cooperative Enterprises, Agricultural Cooperatives, Producer Groups, Producer Organizations, Civil Cooperatives, Rural Corporate Partnerships

Companies being established or merged, with the obligation to have completed the publicity procedures before the commencement of activities of the investment project

Joint ventures engaged in commercial activity

Public and Municipal Enterprises and their subsidiaries (under conditions)

Individual enterprises with a maximum eligible investment project cost of Euro two hundred thousand (€ 200.000) only for the scheme “Agri-food – primary production and processing of agricultural products – fisheries and aquaculture”

The following are exempted from any aid:

Companies, which are subject to pending recovery proceedings at the time of the submission of the application for the investment project (Deggendorf principle)

Companies in difficulty

Enterprises which, during the two (2) years prior to the submission of the aid application

Have relocated the business establishment in which the initial investment for which the aid is sought is to be made or

Refuse to undertake that they will not relocate the above business establishment, for a period of two (2) years, after the completion of the initial investment

Enterprises, which implement investment projects carried out on the initiative and on behalf of the State, based on a relevant project contract, contract for the concession or provision of services

Large enterprises > €1.000.000

Medium-sized enterprises > €500.000

Small-sized enterprises > €250.000

Very small-sized enterprises > €100.000

Social Cooperative Enterprises, Agricultural Cooperatives, Civil Cooperatives, Producer Groups, and Rural Corporate Partnerships > €50.000.

The percentage of the financial participation (of the entity submitting the investment project) on the cost of the investment for which aid is to be granted (aided cost), either through equity or external funding, is set at 25%

Inclusion in the schemes of Part B, requires the

existence of a minimum amount of eligible costs of each investment project

which shall be determined based on the size of the entity and shall amount to € 50.000 – € 1.000.000

Maximum amounts of aid to be granted

The total amount of aid per submitted investment project may not exceed the amount of ten million (10.000.000) euros, with the exception of those schemes of Part B which define either a larger or a smaller amount, subject to the restrictions of Article 4. of the General Block Exemption Regulation and para. 5 of Article 30

The aid provided to each entity that submits an investment project, which includes also aid to cooperating or affiliated companies, may not cumulatively exceed the amount of Euro twenty million (€ 20.000.000) for an individual company and Euro thirty million (€ 30.000.000) for all the cooperating or affiliated companies, subject to the restrictions of Article 4 of the General Block Exemption Regulation. The ceilings hereof shall be increased by 50% in cases where the aid is granted as a tax exemption, with the exception of the specific provisions in Articles 51 to 57 regarding the “Fair Development Transition” scheme

Types of aid

Aid for the investment projects that are subject to the aid schemes of this law shall be provided in the following forms:

Tax exemption

Exemption from the payment of income tax on earnings before tax, which result under tax law, less tax attributable to the profits distributed or received by partners. The tax-exempted amount per year appears as a special reserve and in a corresponding account in the books of the company, formed by the income tax, which was not paid due to the tax exemption provided

Grant

Free provision of money to cover part of the aided expenditure of the investment project. The amounts of the grant shall not be deducted from the value of the investment costs, in order to determine the taxable profits

Leasing subsidy

Coverage by the State of part of the payable installments relating to a leasing (agreement) which has been entered into for the use of new mechanical and other equipment

Subsidizing the cost of a new job created

Partial coverage of the wage cost of the new jobs created and related to the investment project

Business risk financing

relating to the “New Business” scheme, which consists of an interest rate subsidy for subordinated loans or for insurance costs of high-risk loans paid to the credit institutions granting them

Payment of aid

The aid can be provided as a lump sum payment or the beneficiary can use the benefit once, upon the issuance of the decision of completion and commencement of productive activities of the investment project, or gradually, and provided that the conditions of this article are met

Tax exemption

Grant

Leasing subsidy

Subsidizing the cost of a new job created

Tax exemption

The right to start using the benefit of the tax exemption incentive is established upon the verification by the competent audit body and the issuance of the relevant decision that 50% or 65% of the cost of the investment project has been incurred. The entity may utilize the entire eligible aid of the tax exemption within fifteen (15) tax years from the year of establishment of the right to use the benefit subject to the restrictions defined in Article 24 which apply cumulatively

Grant

An amount of up to 25% of the approved grant can be paid to the beneficiary upon the implementation of a project of a total amount equal to at least 25% of the total cost of the investment. The supporting documents shall be submitted together with a certificate of correctness issued by a certified public accountant. The decision of management shall be issued within a strict limitation period of thirty (30) days from the submission of the relevant request. Subsequent payments shall be made at the request of the beneficiary and provided that 50% or 65% of the total cost of the investment project has been incurred. The certification that the above percentage of costs has been incurred is performed by the competent body through an on-the-spot check or an administrative audit. If no intermediate payments are made, the balance of the grant or its total amount shall be paid to the entity after the issuance of the decision of completion and commencement of productive activities of the investment. The amounts of the grant shall not be deducted from the value of the investment costs, in order to determine the taxable profits

Leasing subsidy

The payment of the leasing subsidy may begin after the certification by the competent audit body of the installation in the facility of all the leased equipment, according to the leasing contract. The subsidy shall be paid every six months and after the respective payment of the lease installments by the investment entity, and shall be calculated on the basis of the acquisition value of the equipment included in the paid installments. The amounts of the leasing subsidy shall not be deducted from the value of the investment costs, in order to determine the taxable profits

Subsidizing the cost of a new job created

The commencement of the subsidy for the cost of the employment created may take place after certification by the competent audit body of the creation of the jobs related to the investment project. The subsidy shall be paid every six months and, after the respective payment of the wage costs, by the investment entity. The amounts of the above aid is disclosed in a special reserve account and in case of distribution or capitalization thereof, shall be returned or recovered within the time period provided in point (b) of Article 25, and the sanctions provided for in Law 4174/2013 shall be imposed. In case of distribution or capitalization of part or of the total value of the reserve after the lapse of the above period, it shall be added to the profits of the company and taxed for the tax year during which the distribution or withdrawal of the corresponding amount of the reserve took place, according to the tax legislation

Assessment bodies and procedure

Registers of Investment Project Assessors (Article 117)

Assessment of investment projects

Assessment bodies and procedure

The assessment of an investment project shall be carried out:

by the Assessment Committee referred to in Article 118 or

by a member of the National Register of Certified Assessors or

by a member of the Register of Certified Auditors Accountants referred to in para. 3 (i.e., assessment of the reasonable cost and verification of the scoring indicators) or

by issuing a relevant ministerial decision to the Intermediary Management Body of Operational Programme “COMPETITIVENESS AND ENTREPRENEURSHIP” or

by financial institutions

The assessment of the investment projects shall begin from the date of submission of the application and shall be completed once the result of the assessment review by the Assessment Committee is known, within forty-five (45) days from the expiration of the scheme, as regards comparative assessment cases, and thirty (30) days as regards direct assessment cases. Should the above limits be exceeded, the assessment review shall be assigned, by decision of the competent body of the Ministry of Development and Investments, to an independent certified auditor from the Register of Certified Public Accountants referred to point (b) of para. 1 of Article 117. The Certified Auditor must, at the latest within ten (10) working days from the assignment, complete the assessment of the investment projects.

Registers of Investment Project Assessors (Article 117)

To assess the investment projects hereof, the following shall be used:

the National Register of Certified Assessors, as provided for in Article 7 of the presidential decree 33/2011 (Government Gazette, Series I, No 83)

the Register of Certified Auditors Accountants, established by a decision of the Minister for Development and Investments, which is issued following a proposal by the Hellenic Accounting and Auditing Standards Oversight Board (HAASOB - ELTE) whose members are registered in the Public Register referred to in Article 14 of Law 4449/2017 (Government Gazette, A’ No 176) and have professional liability insurance coverage of at least Euro one million (€ 1.000.000) per incident and a total amount of at least Euro five million (€ 5.000.000) per year

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