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The “Golden Visa” for placements in intangible assets, is expected to have an impact of about 250.000 € or more on the number of transactions made in real estate via the investment incentive scheme (by Non-EU nationals).
The relevant provisions are included in article 42 (Law 4251/2014, Government Gazette 1, no 80) to adjust the Greek legislation with the Directive 2016/943 of 8 June 2016 of the European Parliament and Council.
Following the adoption of the article mentioned above, Non-EU nationals will be able to choose between two different types of investments, in order to obtain a residency permit and gain access to 26 Schengen Countries. They will be able to either pursue a property of a minimum value of 250.000 € or invest at least 400.000 € in Greek Intangible Assets.
In more details, the Greek legislature would provide a five year residency to those who make an investment in one of the following categories:
• a capital injection of atleast 400.000 € to a company with a registered office or establishment in Greece.
• a capital injection of a minimum value of 400.000 € to a Real Estate Investment Company (REIC), which aims to invest exclusively in Greece for an increase in share capital. According to experts, this provision is expected to favor smaller companies or those ready to launch an IPO. For companies that are already established, like NBG Pangaea, the largest REIC in Greece, the 400.000 € capital injection is only a fraction of the increase in share capital, which is to take place towards the end of this year.
• a capital injection of at least 400.000 € to either Venture Capital Companies for the acquisition of new capital shares or to Mutual Funds in order to purchase new shares, provided that the above Alternative Investment Funds (AIF) aim to invest exclusively in companies based in Greece.
• Investments in Greek Government Bonds with a minimum purchase value of 400.000 € and a remaining residual maturity of at least three years from the time of purchase, through a Credit Institution established in Greece.
• A minimum deposit of 400.000 € in a Greek Credit Institution, for at least a period of one year, with a chance of renewal.
• Purchase of shares, corporate bonds and / or Greek government bonds, which are admitted for trading in regulated markets operating in Greece, with a purchasing value of at least 800.000
• Purchase of shares with a value of at least 400.000 € in a mutual fund incorporated in Greece or another country and intended for investments exclusively in shares, bonds and / or Greek government bonds that are admitted for trading in regulated markets operating in Greece, with the condition that the fund’s assets amount to at least 3 million €.
• Purchase of shares with a minimum purchasing value of 400.000 € in an Alternative Investment Fund (AIF), which is incorporated in Greece or another Country Member of the European Union and aims to invest exclusively in the Greek Real Estate sector.
The above transactions should be made through an organized banking system, where a banking account associated with investments in intangible assets is held. The manager of the account is required to invest the funds in transferable securities or Real Estate in Greece (in the case of AIFs), so that the average annual balance of the account does not exceed 20% of the nominal value of the original investment in bonds or shares of the AIF.
In conclusion, it remains to be seen whether the coexistence of these two different types of investment will eventually limit the volume of transactions made in real estate via the “Golden Visa”, which currently exceeds 1 billion euros. Surely, the new regime may act as a stimulus for both the investment banking sector and the real estate investment companies and help boost the Greek economy.
