Setting up a Branch vs Subsidiary in Greece – Legal differences, taxation, obligations

Choosing between a branch and a subsidiary affects liability, taxation, governance and reporting. The right option depends on control, risk profile, financing and operational plans in Greece.

Legal structure and liability

A branch is an extension of the foreign company with no separate legal personality; the parent remains liable for branch obligations. A subsidiary (e.g., S.A., P.C./I.K.E., Ltd./E.P.E.) is a Greek legal entity with separate personality and limited liability for shareholders/members.

Registration and governance

Branches register with the General Commercial Registry (GEMI) and appoint a legal representative in Greece. Subsidiaries are incorporated under Greek law with articles of association, governing bodies (e.g., board or manager) and ongoing corporate governance duties.

Taxation and reporting

Branches are taxed in Greece on Greek‑source profits and follow Greek accounting/reporting for their permanent establishment. Subsidiaries are Greek tax residents taxed on worldwide income (subject to treaty reliefs), file local returns and maintain statutory books. Withholding tax, VAT, transfer pricing and treaty rules must be considered for intra‑group flows.

Employment, compliance and practicalities

Both forms require Greek payroll/social security where staff is engaged locally, and compliance with sector licenses, GDPR and health & safety. Banking, invoicing and e‑books (myDATA) setup differ slightly in practice; subsidiaries often integrate more easily with local vendors and lenders.

How to choose

Select a branch for lower setup where full control by the parent and central treasury prevail, and a subsidiary for limited liability, local credibility and flexible equity participation. Model with advisors for tax, HR and regulatory impacts before deciding.

Comparison snapshot (indicative)

• Legal personality: Branch – none; Subsidiary – separate entity.
• Liability: Branch – parent liable; Subsidiary – limited to company assets.
• Tax base: Branch – Greek‑source profits; Subsidiary – worldwide income (subject to reliefs).
• Governance: Branch – representative; Subsidiary – board/manager and corporate bodies.
• Perception: Branch – extension of foreign HQ; Subsidiary – local player for banks/vendors.

Practical checklist

• Assess regulatory licenses, sector caps and investment screening (if any).
• Map intra‑group flows (services, IP, financing) and align transfer pricing.
• Plan staffing (work permits where needed), payroll and social security.
• Set up banking, invoicing and myDATA e‑books in due time.