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Developments In Privatization In Greece

Establishing a fund and organization to privatize Greece’s assets and restructure Greek state-run enterprises has been a request – sometimes a demand – of Greece’s creditors. See, e.g., The New York Times article The Perils of Greece’s Privatization Efforts and Ekathimerini.com article Pressure Grows For A New Sell-Off Fund. This summer the Greek government approved the asset development plan of the Hellenic Republic Asset Development Fund, the entity that has thus far acted as the corporate vehicle for the implementation of the Greek State’s privatization policy. The plan includes 19 assets pertaining to the sectors of transportation and infrastructure, energy, telecommunications and post, and real estate development.

Ally Law Greece Privatization

The new entity, implementing the privatization policy agreed between the Greek Government and foreign lenders, effectively comprises a hyper-fund managing a wide array of Greek State assets. The entity is established as a société anonyme (anonymous company, or share company, similar to a public limited company in common law jurisdictions) under the corporate name Hellenic Corporation of Assets and Participation (HCAP) with an life-span of 99 years. The initial share capital of HCAP has been set to € 40.000.000 and its sole shareholder is the Greek State. HCAP’s special public purpose is to direct the contribution of resources for the implementation of Greece’s investment policy, and pay off Greece’s public debt in accordance with Greece’s third bail-out agreement. The establishment of HCAP reflects a positive trend favoring privatizations as a means of implementation of the Greek Government’s investment policy; however, it remains to be seen whether this innovative and expansive structure will indeed boost foreign investments in Greece bearing a positive outcome for the debt-struck State.

If you have or are considering investment in Greece, contact your Ally Law member firm to explore how HCAP may affect your investment. Ally Law member firms have attorneys experienced in international corporate and financial regulation and can advise you in navigating the specific jurisdiction laws that impact your investment. For more information about Ally Law member firm services in this area, contact us at team@ally-law.com.