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Set up a Foundation in Greece

Set up a Foundation in Greece

The Greek legislation allows local and foreign parties to set up a foundation in Greece. The foundation is included in the category of non-profit entities, which define a set of legal forms created for other purposes than the one of obtaining a profit from a commercial activity. 

There are several types of non-profit entities, some of the most common being the foundation and the association. Our team of consultants in company formation in Greececan help you understand the legal differences between these entities and, of course, can help you incorporate a foundation or any other non-profit organization. 

What is the law on Greek foundations? 

The legislation regulating the creation of a foundation in Greece is different than the one applicable to legal entities set up for commercial purposes, as these fall under the regulations of the commercial law. Foundations in Greece can take several forms, as they are divided between 2 main categories, and these are:

  1. public benefit entities; 
  2. public benefit and private benefit entities. 

Those who want to set up a foundation in Greece must know that the main rules of law are the following: 

  • public benefit foundations are regulated by the Law 4182/2013 of the Greek Constitution
  • • the incorporation of a public benefit foundation falls under the regulations of the same law mentioned above, Article 1 and Article 50; 
  • private law foundations are regulated by the Greek Civil Code, Articles 108-121;
  • • the types of activities that can be developed by foundations are stipulated under the Article 174 of the Greek Civil Code and Article 178 of the same law;
  • • the incorporation of a foundation is done through a notarized deed, in accordance with the stipulations of the Article 109 of the Greek Civil Code

The legislation stipulates that the foundation gains legal personality once it is recognized by the Greek state. The same requirement is applied for those who want to open a company in Greece for commercial purposes. 

Regarding the registration obligations it must be noted that foundations have to register at a national level. Just as it is required for Greek company formation, the registration of a foundation must be published in the Government Gazzette and, additionally, it must register with the Ministry of Finance. 

Another requirement imposed for the registration is to establish a board of directors and their responsibilities have to be clearly stated in the founding document (please mind that the law does not impose a certain number of members in the board of directors, the board can function with 1 director also). 

The difference between the 2 types of foundations is that the public benefit entity has to address a charitable purpose, or to serve an educational, cultural, religious or similar purpose. In practice, most of the foundations are incorporated to serve a public purpose. 

What are the reporting obligations of foundations? 

Although foundations are not set up for commercial purposes, they do have tax and reporting obligations, just like in the case of commercial entities. Such entities need to justify their finances, as many of them obtain their money from donations and other similar financial sources. 

Therefore, they are required to submit financial statements and to prepare an annual financial report that will be analyzed by the Greek Ministry of Finance. The documentation must be submitted within the first 4 months after the closing of the financial year.  

If you want to set up a foundation in Greece, our specialists can provide further information on the incorporation of this structure. You can rely on our team of consultants in company formation in Greece for assistance on finding a suitable business address or setting up a bank account.