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Private Capital Company (IKE/PC):
A simpler and more flexible corporate form, namely the Private Company (IKE), has been introduced by Law 4072/2012 (A’86). IKE is a private capital company which has capital and the liability of its members for the company debts, except for those with guarantee contribution, is limited. A private capital company is established by one or more natural persons (founders). Participation to a private capital company requires the acquisition of one or more company shares.
The private capital company has capital of at least one (1) Euro. Partners may participate with capital, non-capital or with guarantee contributions. Capital contributions are contributions in cash or in kind. Capital contributions in kind are only allowed when they refer to assets which can be evaluated in cash. Valuation is not required, if the value of the contribution, according to the company’s statutes or the decision which increases the company’s capital, does not exceed five thousand (5,000) Euro. There must be at least one company share representing a capital contribution.
Non-capital contributions refer to benefits, which cannot be the subject of a capital contribution. These benefits must be specified in the company’s statutes and must be executed for some time or indefinitely. Guarantee contributions are contributions which consist of taking responsibility against third parties for the company’s debts up to the amount defined in the company’s statutes. The value of each guarantee contribution cannot exceed a 75% of the liability undertaken by the partners against creditors of the company.
The capital must be paid out in full when establishing the company or when raising capital.
Liability of founders:
As regards corporate obligations, only the legal entity is liable by its assets.
Legal personality and publicity:
The capital company has legal personality and it is a commercial company even if its business purpose is other than trading. The private capital company cannot perform a business activity for which another corporate form is exclusively defined by law.
The establishment of a private capital company is done by its registration at the GE.MI. service of the competent Chamber of Commerce. The disclosure of the P.C. is held either on the website of the company or at the GE.MI. service.
The name of the private capital company (IKE) is formed either by the name of one or more partners either by the object of its activity or by other verbal indications. The corporate name can be entirely or partially expressed in Latin letters. The company name must contain written out in full the words “Ιδιωτική Κεφαλαιουχική Εταιρία” or the acronym “IKE”.
For its international transactions the above words are expressed as “Private Company” or/and the acronym “P.C.”.
The name of single-member private company must include the words “Μονοπρόσωπη Ιδιωτική Κεφαλαιουχική Εταιρεία” or “Μονοπρόσωπη Ι.Κ.Ε.” For its international transactions the above words become “Single Member Private Company” or/and “Single Member P.C.”.
Establishing a Private Capital Company:
A private capital company is established by a private document using the standard “Model AoA”. The competent one stop shop service is the GE.MI. service or the electronic one-stop shops service (https://eyms.businessportal.gr).
There is no requirement for a notarized document unless there is a special provision of the law in case of a capital contribution in kind.
The parties involved or the sole founder or the legally authorized person submits a signed application in order to register the company at the general commercial registry accompanied by the required documents. The GE.MI. service is responsible to proceed with all the required actions in order (a) to issue a tax identification number (A.Φ.Μ.) for the company, (b) to notify all the required information to the Unified Social Security Fund (ΕΦΚΑ) and (c) to proceed with the company’s registration at the GE.MI.
Τhe company’s statutes may be drafted in any of the official languages of the European Union.
The statutory seat of a private capital company is located in the Municipality of the Greek territory referred to in its statutes. A private capital company can establish branches, agencies or other forms of secondary establishment in other areas of Greece or abroad.
The duration of a private capital company must be defined in the company’s statutes. If not defined, the duration of the IKE is presumed to be twelve years (12) after its establishment.
Corporate Tax Rate for 2021 = 22%
Dividend Tax Rate = 5%
Taxation example, assumed net profit = 50.000 €:
We are expecting a corporate rate deduction from 22% to 20% for 2022.
Head of Marketing & Business Development @ Start You Up