NEPA: THE GREEK MARITIME COMPANY FOR COMMERCIAL PLEASURE YACHTS
The Maritime Company for Pleasure Yachts (“NEPA”) is a Greek commercial company whose exclusive object is the acquisition, exploitation and management of commercial pleasure yachts under Greek flag.
“Commercial Pleasure Yachts” are yachts which are characterized as such under the law of the flag they carry, with a capacity for transportation up to 49 passengers, and disposing of sufficient and adequate living spaces for the passengers, and for the exploitation of which a full charter agreement in entered into.
Commercial pleasure yachts under Greek flag must be registered at the Greek electronic ship registry.
It should be noted however that it is not prohibited to establish a company with a different legal form for the same activity (e.g. an IKE or SA).
In 2022 a new law reformed the legal framework regulating the establishment and operation of NEPA companies with the aim to update and modernize it.
According to the new law:
- the NEPA may be established by one or more persons, either natural or legal entities (according to the previous regime, at least two persons were required)
- The NEPA is established for a specific duration, freely determined by the parties in its articles of association. Where the duration is not specified, its duration is 30 years. The duration may be extended, and it may also be converted from a specific duration to an indefinite duration.
- As under the previous regime, the minimum share capital required is 10 000 euros, however it is no longer required to be paid in full at the moment of incorporation. It may be paid (in full) within two months from the establishment of the company. The nominal value of each share cannot be under 1 euro.
- In accordance with the new provisions, now all NEPA shares must be registered (i.e. it is no longer possible to have shares to the bearer). All existing NEPA companies must convert their shares from shares to the bearer to registered shares before the 31/12/2023.
- Another important amendment introduced by the new law is the possibility for non- EU/ EEA persons (natural persons or legal entities) to acquire rights over the shares of the NEPA.
- The NEPA is managed by the board of directors (BD). The minimum number of directors is 3, and according to the new provisions, it is not possible to appoint a legal entity as director. Board members however are not required to be shareholders. The BD is elected for a term of 6 years. The BD must appoint a President, vice- president and secretary the President is also the Managing Director.
- Contrary to the previous provisions, where this is allowed by its articles of association, the NEPA may enter into agreements with its founders, the members of the BD and its employees, when they are acting in their personal capacity or as representatives of another legal entity. However it may not enter into charter agreements with those persons or their relatives, acting under their personal capacity or as representatives of another legal entity. Notwithstanding the foregoing, the NEPA may enter into charters with tourist agencies.
- NEPAs are registered at the NEPA registry held by the Ministry of Maritime Affairs and Insular Policy.
- The minutes of the meetings of the BD and the General Meeting (GM) of the NEPA must be filed to the NEPA registry within 6 months from the date of the relevant meeting.
- NEPA companies which were established before the new law are required to adapt their articles of association to be in conformity with the new provisions before the 31/12/2023.
Tax matters concerning NEPAs:
- Articles 1 and 2 of Law 27/1975 (tonnage tax regime) apply to the NEPA, provided that it owns a ship, as well as to its shareholders.
- The following are exempt of any tax, fee or other charge (with the exception of stamp duty and capital concentration tax):
- The distribution of profits, with the exception of remuneration of the members of the board of directors, which are subject to income tax
- The withdrawal of capital and the relevant receipts
- The entries in the accounting books of the company, the documents received in Greece regarding the company’s operation abroad
- The deposits and loans of the shareholders towards the company, with the exception of income tax on interests.
- The capitalization of profits
- The non- receipt of profits by the shareholders.
The above are not applicable to NEPAs which manage or exploit commercial pleasure yachts which are owned by third parties, in connection with their obligations regarding income tax.
EIPA: THE GREEK MARITIME COMPANY FOR PRIVATE PLEASURE YACHTS
The sole object of the EIPA is to acquire the ownership of private pleasure yachts under Greek flag.
“Private Pleasure Yachts” are yachts which are characterized as such in accordance with the laws of the country of the flag they carry, and which are used for private purposes and not for any commercial or profitable activity.
Private pleasure yachts under Greek flag must be registered to the Greek electronic ship registry.
This type of company is intended for persons that do not wish to acquire a yacht under their own name and therefore use this type of company.
The EIPA has existed since 2009, however it remained inactive. Its inclusion in the new law of 2022 was deemed necessary after Brexit, as several private pleasure yachts were seeking to change their flag into an EU flag. The aim of the law was to attract those yachts under the Greek flag. In addition to the foregoing, the acquisition of a yacht under a special legal entity aims to provide a safer and more efficient interaction with the authorities, as the law sets in place a set of procedures which are expected to reduce bureaucracy for the establishment and operation of this type of companies and activity.
According to the provisions of the new law:
- EIPA is a non- profit company which is established under this law and is regulated by this law and by the provisions of the Greek Civil Code applicable to companies in general.
- Its sole object is to own private pleasure yachts under Greek flag, and may lease those vessels to third parties without departure. Lease without departure refers to the concession of use of a yacht in port, against consideration (rent), under the conditions of the law, during which lease, the yacht may not execute voyages.
- The EIPA may be established by one or more persons, natural or legal entities and is registered at the EIPA Registry.
- The minimum share capital of the EIPA is 5.000 euros and is paid by the founders at the time of incorporation. The acquisition of a yacht is effected under the company’s name, without it being required to include and register such amount to the share capital of the company. The founder or the legal representative of the company or the user of the yacht or also any shareholder are jointly liable towards the authorities for the compliance with the tax and other provisions for the purchase and ownership of a yacht in Greece.
- The directors of the EIPA are not subject to paying social contributions, solely due to their capacity of directors.
- The EIPA must keep simplified accounting books and pay an annual fee of 800 euros.
- The shareholders do not receive dividends and are not liable with their personal property for the liabilities and debts of the company, with the exception of liabilities towards the Greek authorities.
* This publication is for informational purposes and does not constitute legal advice. For additional information in connection with the above or our services, please contact us.