Official Name: Helenic Republic
Time Zone: UTC + 02:00
Internet Domain: .gr
International Dialing Code: +30
|Location and Size||Credit and Collections|
|Legal System||Business Protocol|
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Greece is located in Southern Europe, bordering the Aegean, Ionian and Mediterranean Seas between Albania and Turkey. It is approximately the size of the US state of Alabama — area: 131,957 sq. km. (51,146 sq. mi.)
Parliamentary republic with three branches:
- Executive: President Prokopis PAVLOPOULOS (since 13 March, 2015), head of state; Prime Minister Kyriakos MITSOTAKIS (since 9 July 2019), head of government.
- Legislative: 300-seat unicameral Parliament
- Judicial: Supreme, Civil and Criminal Courts
Greece’s legal system is based on codified Roman law. The judiciary is divided into civil, criminal, and administrative courts. Greece has accepted compulsory International Court of Justice (ICJ) jurisdiction.
After enduring a recession in 2015 and uncertainty that was brought on from the political group Syriza, Greece began to experience growth that sprang from decreased tension from the international financial community. The completion of the European Stability Mechanism program should lead to debt relief by the end of 2018, which will bring investment recovery and continued growth.
- Currency: Euro (EUR)
- Leading Markets (2017): Italy 10.6%, Germany 7.1%, Turkey 6.8%, Cyprus 6.5%, Bulgaria 4.9%, Lebanon 4.3%
- Leading Exports – Commodities: Food and beverages, manufactured goods, petroleum products, chemicals, textiles
- Leading Suppliers (2017): Germany 10.4%, Italy 8.2%, Russia 6.8%, Iraq 6.3%, South Korea 6.1%, China 5.4%, Netherlands 5.3%, France 4.3%
- Leading Imports – Commodities: Machinery, transport equipment, fuels, chemicals
- Top Industries: Tourism, food and tobacco processing, textiles, chemicals, metal products, mining, petroleum
- Top Agricultural Products: Wheat, corn, barley, sugar beets, olives, tomatoes, wine, tobacco, potatoes; beef, dairy products
|Population growth rate (%)||-0.07||-0.63||-0.51||0.16||0.19||0.49|
|GDP* (USD billions)||299.3||153.5||102.1||2,317.0||31.03||2,186.0|
|GDP*** per capita (USD)||27,800||21,800||24,700||38,200||14,900||27,000|
|Real GDP growth (%)||1.4||3.6||2.8||1.5||0.0||7.4|
Population Below Poverty (%)
(per USD) on 9/05/2019
(per EUR) on 9/05/2019
* 2017 Estimates
*** PPP ” Purchasing Power Parity
Payment Practices in Greece
Bills of exchange are widely used by Greek companies in domestic and international transactions and, along with promissory notes, are not subject to stamp duty. In the event of payment default, a protest certifying the dishonored bill must be drawn up by a public notary within two working days of the due date.
Checks are still widely used in international transactions. In the domestic business environment, however, checks are customarily used less as an instrument of payment than as a credit instrument. Post-dated checks endorsed by several creditors therefore represent common and widespread practice. Issuers of dishonored (bounced) checks may be liable to prosecution provided a complaint is lodged.
Promissory letters are another means of payment widely used by Greek companies in international transactions. Issued to the creditor by the customer’s bank, these are a written acknowledgement of an obligation to pay the creditor at a contractually fixed date. Although promissory letters are a sufficiently effective instrument, in that they constitute a clear acknowledgement of debt on the part of the buyer, they are not deemed a bill of exchange, and so fall outside the scope of the “exchange law”.
SWIFT bank transfers, well established in Greek banking circles, are used to settle a growing proportion of transactions, and offer a quick and secure method of payment.
The recovery process begins with the creditor sending the customer a final demand for payment by recorded delivery mail. The final demand should include any contractually agreed interest penalties or interest penalties accruing at the legal rate of interest. Under a presidential decree, interest is due from the day following the date of payment stipulated in the invoice or commercial agreement. Payment is to be calculated at a rate equal to the European Central Bank’s refinancing rate, unless the parties agree otherwise, plus seven percentage points.
Creditors may seek an injunction from the court to pay via a lawyer under a fast-track procedure. This takes about one month from the date of the petition. To qualify for an injunction, the creditor must possess a written document substantiating the claim underlying his lawsuit. This can be an accepted and protested bill, an unpaid promissory letter or promissory note, an acknowledgement of debt established by private deed, an original invoice summarizing the goods sold and bearing the buyer’s signature certifying receipt of delivery, or the original delivery slip signed by the buyer.
The ruling issued by the judge allows immediate execution, subject to the defendant’s right to lodge an objection within 15 days. To obtain suspension of execution, the customer must petition the court separately.
A “justice of the peace” hears claims up to EUR 12,000. A court of first instance, presided by a single judge, hears claims not exceeding EUR 80,000. A panel of three judges hears larger claims.
Where creditors do not have written and clear acknowledgement of non-payment from the customer, or where the claim is disputed, the only alternative is to obtain a summons under ordinary proceedings. Such litigation can take a year or more to finalize.
Greece accepts binding international arbitration of investment disputes between foreign investors and the Greek State. Foreign firms have found satisfaction through this arbitration. International arbitration and judgments by the European Court of Justice supersede local court decisions.
Greece has an independent judiciary. The judicial system provides for civil court arbitration proceedings for investment and trade disputes. However, the court system is a time-consuming means for enforcing property and contractual rights, and foreign companies report that Greek courts do not always provide unbiased and effective recourse.
Greece is a signatory of both the International Center for the Settlement of Investment Disputes and the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards.
Foreign court judgments are accepted and enforced, however slowly, by the local courts.
Eroding Greek finances have prompted major credit rating agencies to downgrade Greece’s international debt rating. This has led to increased financial instability.
Coface Country Rating: B — Changes in generally good but somewhat volatile political and economic environment can affect corporate payment behavior. A basically secure business environment can nonetheless give rise to occasional difficulties for companies. Corporate default probability is quite acceptable on average.
Coface Business Climate Rating: A3 — Small industrial base; low-tech exports (food, chemicals, meats, refined oil)
Credendo Political Risk Rating: 1 ” Lowest risk (1-7)
Credendo Commercial Risk Rating: C ” Highest risk (A, B, C)
Greece, as a member of the European Union, provides a reasonably hospitable climate for foreign investment. On the upside, Greece’s membership in the EU’s Economic and Monetary Union offers currency stability, the infrastructure has improved significantly in the last five years. Greece is actively positioning itself as a hub for Balkan trade.
The Greek economy has been gradually transforming in ways that improve flexibility and openness, but progress has been slow. Privatization has reduced the state’s dominant role in the economy, and the overall entrepreneurial environment has been enhanced by implementation of a more competitive corporate tax rate and more efficient regulation.
Foreign Trade Zones: Greece has three free-trade zones, located at Piraeus, Thessaloniki and Heraklion port areas. Greek and foreign-owned firms enjoy the same advantages in these areas. Goods of foreign origin may be brought in without payment of customs duties or other taxes and remain free of all duties and taxes if subsequently transshipped or re-exported. Documents pertaining to the receipt, storage, or transfer of goods within the zones are free from stamp taxes.
Handling operations are carried out according to EU regulations. Transit goods may be held in the zones free of bond. The zones also may be used for repackaging, sorting and re-labeling operations. Assembly and manufacture of goods are carried out on a small scale in the Thessaloniki Free Zone. Storage time is unlimited, as long as warehouse charges are paid every six months.
Transparency of Regulatory System: As an EU member, Greece is required to have transparent policies and laws for fostering competition. Foreign companies consider the complexity of government regulations and procedures, and their inconsistent implementation, to be the greatest impediment to investing and operating in Greece. Greece’s economy continues to be hampered by extensive government regulation and many international corporations state that bureaucracy remains the number one impediment to doing business in Greece.
Intellectual Property: Implementation and enforcement of copyright protections are not rigorous. As a result, intellectual property problems continue in Greece despite its membership in the Paris Convention for the Protection of Industrial Property, the European Patent Convention, the World Intellectual Property Organization, the Washington Patent Cooperation Treaty, and the Bern Copyright Convention.
Greece lags in the implementation of enforcement of intellectual property rights (IPR). The judiciary is not focused on the issue and has little training on IPR issues. The lack of enforcement resulted in Greece being placed on the U.S. Special 301 Watch List.
Audiovisual, music, and software industries bear the brunt of IPR violations in Greece. This is likely to rise with increased penetration of the internet. Unlicensed sharing of a licensed copy among multiple computers is the largest problem for the software industry, while street vending of DVDs and CDs is a common practice.
Trademark violations, especially in the apparel sector, are an area of some concern. Although Greek trademark legislation is fully harmonized with that of the EU, US companies believe the importation and sale of counterfeit products may be increasing.
Corruption: Although the Greek government has been energetically prosecuting corrupt judges and attorneys in the last few years, problems with corruption still exist. Greece ranked 60th in the 2019 Transparency International Corruption Perception Index. The score reflects insufficient levels of anti-corruption enforcement, lengthy delays in the judicial process and systemic weaknesses which have resulted in a number of recent corporate corruption scandals.
Economic Freedom: Greece’s economic freedom score is 57.7, making its economy the 106th freest in the 2019 Index of Economic Freedom. Its overall score has increased by 0.4 point from last year. Greece is ranked 43rd out of 44 countries in the European region, though its overall score is above the world average.
Political Unrest: Currently, the Greek Government is under intense pressure by the EU and international lenders to implement a medium-term austerity program that includes cutting government spending, reducing the size of the public sector, and reforming the labor and pension systems. Athens, however, faces long-term challenges to push through reforms unpopular with the country’s powerful labor unions and the general public. Greek labor unions are prepared to strike over new austerity measures and continued widespread unrest could lead to rioting or violence.
Relationships are the linchpin of business dealings in Greece as Greeks prefer to do business with those they know and trust. Nepotism is not viewed negatively.
Business Cards: Have business cards and other printed material in both English and Greek.
Business Attire: Business dress is similar to that in most of Europe. Men wear dark colored, conservative business suits. Women wear either business suits or tasteful dresses, preferably in dark or subtle colors.
Names and Titles: Greeks are more formal with names than some other countries. First names are used only among friends and close business contacts. The head of an office will typically be addressed using the title of Mr. and his last name. It is best to be more formal when first meeting. Even when first names are used, Greeks may add a title such as Mr. or Mrs. before a first name as a sign of respect.
Conversation: Some business people speak English; however, it is a good idea to hire an interpreter. The Greek style of conversation is loud and often emotional. It has been said that Greeks live their lives with an exclamation point!
Gifts: Bringing small gifts with a company logo is appropriate and appreciated” although not required in the first meeting.
Meetings: Greeks prefer face-to-face meetings rather than doing business by telephone or in writing. Appointments are necessary. During the first meeting your Greek business colleagues will want to get to know something about you as a person. The second meeting is used to develop trust and mutual respect. By the third meeting, business may begin.
Negotiations: Forming a personal relationship is critical to developing a successful business relationship. Companies are hierarchical. Greeks respect age and position. Business is conducted slowly. Decision making is held at the top of the company. Imposing a deadline on reaching a decision may end the negotiations.
It is recommended that a local partner, or lawyer, be found to assist in any negotiations. This is important not only for the legal issues, but also as the Greeks place great value in knowing with whom they are working.
Acceptable Public Conduct: Never say or do anything that can be construed as challenging the honor or integrity of a business colleague. Under no circumstances should you publicly question someone’s statements.
Embassy of Greece, Washington, DC
- Greece is the world’s third leading producer of olives
- 80% of Greece is mountainous
- In the 1950’s, only 30% of the population could read and write, today the literacy rate is 96%
- Voting is required for every Greek citizen aged 18 and over
- Greece enjoys more than 250 days of sunshine, or 3,000 sunny hours a each year
- Greece is the leading producer of sea sponges
- Greece has more archaeological museums than any other country in the world
- Soccer is the national sport of Greece
- Feta, which is made from goat’s milk, is the national cheese of Greece
- The first Olympic Games in 775 B.C. took place in Greece
- Greece organized the first municipal dump in the Western world in 500 B.C.
This information is provided by ABC-Amega Inc. Providing international receivable management and debt collection services for exporters to more than 200 countries including Greece. For further information, contact [email protected].
This report represents a compilation of information from a wide variety of reputable sources.
Economic Indicators: Variety of sources including the CIA World Factbook, Coface Country Rating, Economist Country Briefings, Federation of International Trade Associations (FITA) Country Profiles.
Historical Exchange Rates: OANDA.com The Currency Site.