The New Regime of Bond Loans in Greece

Kimon Saitakis

Authors

Kimon Saitakis Law School of the National and Kapodistrian University of Athens https://orcid.org/0009-0003-3797-7050

Keywords:

Bond loans, bonds, corporate finance, Greek business law, bondholder, bondholder agent, bondholders’ meeting, subscription agreement

Abstract

Corporate financing through bond loans has witnessed a significant surge in popularity within Greek capital markets over recent decades. In response to this evolving landscape, Greek Law 4548/2018 was enacted with the aim of establishing an appealing legal framework for financing Greek companies, superseding the provisions outlined in Greek Laws 2190/1920 and 3156/2003. This study delves into the exploration of the novel legal framework introduced by Greek Law 4548/2018, specifically focusing on private placement bond loans.

The primary hypothesis guiding this investigation revolves around the notion that the new legal framework, as delineated by Greek Law 4548/2018, has reshaped the landscape of bond loan financing in Greece. The study aims to uncover the key objectives behind the legislative changes and assess the impact of these changes on the financial landscape for Greek companies.

After providing a succinct overview of the most noteworthy innovations introduced by Greek Law 4548/2018 and elucidating the advantages associated with bond loan financing, the study scrutinizes the fundamental features inherent to bond loans. Within this context, the legal nature of bonds is analyzed, considering the contemporary trend steering away from the traditional legal function of securities tied to physical possession. The research further delves into the key stakeholders involved in the bond loan process, including the issuing company, bondholder, and bondholder agent. The study seeks to explore the objectives and outcomes associated with these structures, contributing to the originality of the article.

The novelty of this article lies in its comprehensive exploration of the transformed legal landscape for private placement bond loans in Greece following the enactment of Greek Law 4548/2018. By delving into the objectives, outcomes, and organizational structures associated with bond loans, this study aims to contribute valuable insights to the evolving field of corporate financing in Greek capital markets.

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Legal Acts

Directive (EU) 2011/61 of 8 June 2011 (Alternative Investment Fund Managers Directive, known by its acronym "AIFMD")

Regulation (EU) 2017/1129 of 14 June 2017 (on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market and repealing Directive 2003/71/EC)

Regulation (EU) 909/2014 of 23 July 2014 (on improving securities settlement in the European Union and on central securities depositories and amending Directives 98/26/EC and 2014/65/EU and Regulation EU No 236/2012)

Regulation (EU) 575/2013 of 26 June 2013 (on prudential requirements for credit institutions and investment firms and amending Regulation EU No 648/2012)

Regulation (EU) 345/2013 of 17 April 2013 (on European venture capital funds)

Law No. 4548/2018 - Reform of the law on limited liability companies (GG Α 104/13-6-2018). Available at: https://www.et.gr/api/Download_Small/?fek_pdf=20180100104

Law No. 4209/2013 - Adaptation of Greek legislation to Directive 2011/61/EU on Alternative Investment Fund Managers and Directive 2011/89/EU on the supplementary supervision of financial entities in financial conglomerates, measures for the implementation of Regulation (EU) 648/2012/EU on OTC derivatives, central counterparties and trade repositories (GG Α 253/21-11-2013). Available at: https://www.et.gr/api/Download_Small/?fek_pdf=20130100253

Law No. 3401/2005 - Prospectus for the public offer of securities and their admission to trading (GG A 257/17-10-2005). Available at: https://www.et.gr/api/Download_Small/?fek_pdf=20050100257

Law No. 3156/2003 - Bond loans, securitisation of receivables and receivables from real estate and other provisions (GG Α 157/25-6-2003). Available at: https://www.et.gr/api/Download_Small/?fek_pdf=20030100157

Law No. 2190/1920 Law on limited liability companies (GG Α 216/19-9-1920). Available at: https://www.lawspot.gr/nomikes-plirofories/nomothesia/nomos-2190-1920

Greek Civil Code [Αστικός Κώδικας] (CC). Available at: https://ministryofjustice.gr/wp-content/uploads/2019/10/%CE%91%CF%83%CF%84%CE%B9%CE%BA%CF%8C%CF%82-%CE%9A%CF%8E%CE%B4%CE%B9%CE%BA%CE%B1%CF%82.pdf.