Limited Liability Company – LTD

The legislator does not come up with a definition for the Limited Liability Company, leaving this task to the economic and legal science. The 1^st article of Law No. 3190/1955, merely describes the concept of LTD. and defines its main feature, which is none other than the limited liability that the partners have for the company’s obligations.

In any case, the LTD. is an intermediate (mixed) corporate between the Private and the Capital companies. It is a commercial company, even if its purpose is not to be a commercial company, according to the Art.3 of Law No.3190/1955. Regarding the members of an LTD. the case law, almost without exception, accepts that the mere fact of their participation in the company does not acquire them the commercial capacity. In order for this to happen, the partner concerned, must have active participation in the company’s activities.

The process of the company’s establishment is done in the One-Stop Service (e-OSS) or through a certified notary using the standard article of association. At the end of the process, the company obtains a G.E.MI. and a TIN, which is registered in the Chamber and the EFKA is automatically informed. The founders receive from the system digitally signed copies of the corporate contract and the announcement of the company’s establishment.

The cost of incorporation through e-OSS amounts to 18 euros for capital companies (S.A., LTD., P.C.). The company’s Cost Note of Incorporation is non-refundable.

And in addition:

a) The registration fee for G.E.MI. amounts to 10 euros.

b) The cost of registration in the chamber, which is determined by each Chamber.

c) Finally, in favor of the Competition Commission, which amounts to 1% of the capital listed in the article of association.

a) A notary’s fee is 500 euros for the drafting of the contract plus 6 euros per sheet, plus VAT. 24%. The cost of the copies is 5 euros per sheet, plus VAT. 24%. The notary himself collects it and it is not part of the Cost Note of Incorporation.

b) A lawyer’s fee, when required. According to the law, the presence of a lawyer is required, if the capital of the company is greater than 100.000. The minimum fee of the lawyer is set at 1% for an amount up to 5,000,000 and 0,5% for an amount above that of the sum of the company’s contract (amount of the company’s capital). Attention: this applies to any lawyer that will be present. If, for example, two people work together for the establishment of the company and they each have their own lawyer, then a fee will be paid to both lawyers. The lawyer himself collects it and it is not part of the Cost Note of Incorporation.

A single person can establish a Limited Liability Company, or an already established LTD., to become a single-member company. However, the single-member LTD. is invalid, if the partner (natural or legal person) who established it is also the sole partner in another single-member LTD., or if it has been established by another single-member LTD. The single-member LTD. is a special form of limited liability company, set up or acquired by a single person. This person, natural or legal, cannot participate as a sole partner in another similar company. This implies that a Single-Member LTD. does not have the right to acquire or become a sole partner in another Single-Member LTD.

At the General Meeting of Partners, where there is only one partner, a notary is present and signs the minutes, so that there is an audit by the State.

The name and the distinctive title shall be checked following the provisions of circumstance c’ of par. 2 of Art.2 and par. 3 of Art.5 of Law No.3419/2005, as amended and applicable. This procedure confirms the non-selection of a common name or a distinctive title that another pre-existing company has.

1. The name of the limited liability company is formed either by the name of one or more partners or by the object of the activity it carries out or by other verbal indications. The company’s name can be rendered in whole or in part in Latin characters.
2. In the name of the limited liability company, the words «Limited Liability Company» or the acronym «LTD», must be contain, in each case, in full. For international transactions, the above words are expressed as «Limited Liability Company» and the acronym as «L.L.C. » or «LTD».
3. If the company is a single-member company, the name must contain the words «Single Member Limited Liability Company» or «Single Member LTD.». For international transactions, the above words are expressed as «Single Member Limited Liability Company» or «Single Member L.L.C.» or «Single Member LTD» (Law No.3190/1955, Art.2 Name).

In general, the name of each company can be formed from other indications (“fictitious” name). It is clear that, even in the case of choosing a “fictitious” name, the generally accepted principles of naming must be observed in any case. Namely, the principle of truth, which requires the operator not to use a name that can mislead the public regarding his true identity, the type and extent of their business or their relationship with third parties.

The LTD, as well as the Public Limited Company, is incorporated with a notarial document, which contains the article of association, or with a private document, if a standard article of association is endorsed, according to the 31637/2017 decision of the Minister of Economy and Development (B’ 928) and the article 9 of Law No.4441/2016 (A’ 227). The document is also a notarial one, if required by a special provision of the law, if assets are contributed to the company, for the transfer of which this type is required, or if the notarial document is chosen by the parties.

The article of association of the limited liability company must contain provisions:

• of the name, the surname, the patronymic, the profession, the home address, the e-mail address, Tax Identification Number (TIN.), and the identity card number (ID number) or passport of the partners,
• of the company name,
• of the status of the company as limited liability,
• the registered head office of the company. The registered office is in a municipality of the Greek territory,
• of the purpose of the company,
• of the capital of the company, the participation share, most of the company’s shares of each partner, and the certificate of the founders for the payment of the capital,
• of the object of in-kind contributions, their valuation, and the name of the contributor, as well as the total value of the contributions in kind,
• of the way, the company is managed and represented.

The LTD as a capital company must have a capital, which is formed either by cash or by contributions in kind. The amount of the capital is freely determined and is formed either by cash or by contributions in kind, in accordance with the conditions of article 5 (the contributed item is an asset that is receptive to monetary valuation).

The LTD must have a certain duration after which it is dissolved. The law does not set a maximum or minimum duration. The duration of the LTD is extended by a decision of the General Assembly that has to be taken before the end of the term and with an increased quorum and majority.

Each partner participates in the company with only one participation share and with more company shares. These shares constitute their participation shares if their contribution is multiple of the minimum amount of the participation share, according to the article of association. The company shares have a nominal value of at least one (1) euro. The nominal value is equal for all company shares.

• The most important is the similarity of LTD. with S.A., and at the same time, its great advantage is corporate responsibility. For the corporate obligations, the only one responsible is the LTD itself (the legal entity), with its assets and not its partners, who, although they participate in the management and administration of the company, have limited liability and only risk losing their corporate shares.
• The administrators of the company are the «General Assembly» of the partners, who convene at least once a year, and the «Administrator», who is elected by the General Assembly (G.A.). A majority is required when a decision is made, of both corporate shares and partners (natural or legal persons).
• It is a legal person and a commercial company according to the standard criteria, even if its purpose is not commercial.
• The initial capital of the company is divided into equal shares, the «participation shares», and the corporate shares with a value of at least 1,00€. The share of the corporation cannot be represented by shares and cannot be transferred if not all partners agree.
• The responsibility of the partners is limited. Unlike the Private companies in the LTD, there is a separation of the company’s assets from the personal property of the partners.
• It has specific terms of publicity throughout its operation.
• It has an indefinite or definite duration (although the omission of the duration is not a reason to call the company invalid).
• Each co-owner of LTD. is a freelancer and therefore has an obligation to be insured with EFKA.
• The manager of the LTD., who can manage the company as the sole owner, has personal responsibility for the illegal actions of the company and any illegal bankruptcy, with a limit on all his movable and immovable property.

The decision-making process is done by a majority of more than half of the total number of partners, representing more than half of the total capital share.

1. Limited liability of the partners for the company’s obligations (up to the amount of their contribution to the capital share)
2. Absence of a minimum initial capital- Abolished by the Law No. 4156/2013
3. Flexibility in decision making concerning an S.A.
4. Improved credit rating due to the keeping of diplographic books
5. Quick and easy incorporation process through the «One Stop Service»
6. Ability to raise a bigger initial capital against the (O.E., EU)

1. Inability to raise capital from the Capital Market (Stock Exchange, Bonds)
2. Lack of confidence of traders for the execution of large projects, due to the existence of small capital concerning an S.A.
3. Observance of strict accounting- auditing rules and publicity conditions (preparation and publication of accounting statements, issuance of a tax certificate, etc.) throughout the entirety of its operation
4. Higher operating costs due to the above
5. It is prohibited to carry out certain activities in the financial and stock exchange space, such as banking, insurance, and stock exchange services, securities portfolio management, mutual fund management, leasing, etc.