Greece’s Ministry of National Economy and Finance (YNOP) is rolling out a new regulatory framework aimed at attracting international fund managers to Athens. A key provision—added to the omnibus bill following public consultation—seeks to position Athens as a regional hub for alternative investment management, including hedge funds, private equity, and Alternative Investment Funds (AIFs).
Aim: Regulatory Certainty, Not Relocation
The initiative does not require foreign fund managers or their underlying investment vehicles to shift their tax residency to Greece. Instead, it clarifies that establishing local operations—such as offices or relocating key personnel to Athens—to provide portfolio management, support, or related services will not automatically trigger Greek tax residency for the fund, its manager, or its investors.
This addresses a major concern for global asset managers weighing operational expansion: whether a physical presence in Greece could unintentionally create broader tax obligations across their entire fund structure. Under the new rule, foreign investment funds—whether based in the EU or in third countries meeting specific conditions—will continue to be taxed solely in their country of establishment.
Broader Economic Benefits
Beyond the fund managers themselves, the move targets a wider ecosystem: legal, audit, tax advisory, banking, fintech, and consulting services that typically cluster around investment hubs. By drawing talent and functions to Athens—potentially from London, other European capitals, the Middle East, and Asia—the government aims to generate high-skilled jobs, boost demand for specialized professional services, and expand the domestic tax base.
The Ministry stresses that all income generated within Greece—such as fees for locally performed services—will remain fully taxable under Greek law. The goal is not to offer tax avoidance, but to remove ambiguity and foster confidence in Athens as a credible, rules-based location for international investment operations.