CEE Legal Matters

Category: Greece

  • Karatzas & Partners Advises Autohellas and StormHarbour in First Non-Banking Receivables Securitization in Greece

    Karatzas & Partners Advises Autohellas and StormHarbour in First Non-Banking Receivables Securitization in Greece

    Karatzas & Partners has advised AutoHellas S.A., an independent car leasing company in Greece, and StormHarbour, as the arranger, on the securitization of automotive leases for small and medium-sized enterprises originated by Autohellas. The transaction was funded by the European Investment Bank, the European Investment Fund, KfW, and the EBRD.

    According to Karatzas & Partners, ”this transaction represents an important milestone for the Greek securitization market as it is the first ABS transaction issued by a non-bank originator.”

    Within its mandate to promote SME financing in Europe, KfW has invested a total of EUR 25 million by purchasing senior notes benefiting from a first demand guarantee issued by the EIF, while the EIB and the EBRD have respectively subscribed to EUR 32.3 million and EUR 15 million of the senior notes. The senior notes guaranteed by EIF and purchased by the EIB will be guaranteed through the European Fund for Strategic Investments, part of the Juncker Plan. The junior notes that comprise the rest of the capital structure will be retained by the originator. 

    The operation is also part of the ENSI initiative (EIF-NPIs Securitization Initiative), a cooperation platform between the EIB Group and National Promotion Institutions (NPIs), including KfW and the EBRD, which pursues the goal of stimulating access to SME credit in the spirit of the Juncker plan initiatives. 

    The joint investment under the ENSI initiative was arranged by StormHarbour and the senior notes are rated B+ and BBB- respectively by S&P and Scope. The transaction features an 18-month revolving period and will allow Autohellas to obtain medium-term liquidity, which will then be re-used by providing new leases to SMEs in Greece over the coming years.

    Karatzas & Partners did not reply to our inquiries.

     

  • The Buzz in Greece: Interview with Christina Papanikolopoulou of Zepos & Yannopoulos

    The Buzz in Greece: Interview with Christina Papanikolopoulou of Zepos & Yannopoulos

    According to Christina Papanikolopoulou, Partner at Zepos & Yannopoulos in Athens, the major issue at hand in Greece is the lack of clarity in the work of policy makers that “has a spill-over effect on legal, regulatory, and other issues.”

    Among the recent examples Papanikolopoulou highlights are the various amendments to Greece’s NPL legislation (the latest of which was enacted on June14, 2018). She refers to the NPL legislation as “bipolar,” as it consists of two primary elements: one is protecting borrowers from aggressive servicing and collection strategies, while the other is the interest in banks and investors in resolving NPLs adequately.

    “On one side, although a bit cumbersome, the Bank of Greece has created a very efficient framework for the servicing of banking loans,” Papanikolopoulou reports. Any purchase of NPLs must be made following engagement of a licensed servicer which is thoroughly supervised; in that sense, borrower protection is managed through the servicing schemes. Papanikolopoulou adds, “Nothing further is required or should be required in the frameworks applicable for the sale of NPLs.”  

    The law itself on acquisition of NPLs was introduced by the Greek government in December 2015, and Papanikolopoulou reports that, “it was redundant, as it created a lack of clarity, additional burdens on the sellers, and added nothing to the protection of borrowers. The framework was there all along, through well-tested securitization legislation repeatedly used by banks since its enactment in 2003.”

    Turning to a happier subject, Papanikolopoulou notes that the European Commission is considering a pan-European servicing company, which Papanikolopoulou considers “a very positive step,” as the Greek market is the pioneer in Europe for introducing the framework for servicers of non-performing and performing loan portfolios. Indeed, the Greek framework has improved since its adoption in December 2015, she reports. “The process for the licensing and monitoring servicing activities by the Bank of Greece is now excellent,” she says.  

    Another improvement Papanikolopoulou cites involves the Greek court system. According to her, the difficulties in resolving enforcement-related disputes had a negative effect. “We had a different code and fragmented legislation on the insolvency of individuals and commercial entities,” she says, noting that the legislation is still fragmented. However, she reports, amendments introduced a few months ago are already leading to smoother work. “These amendments are fine-tuning the new procedures and frameworks, and while the work is in progress, it is getting better,” she says. “The approach has become more efficient, the judges are now more accustomed to this kind of dispute, and the entire process from enforcement to insolvency has become quicker and more user-friendly.”

  • Jasel Chauhan and Anthony Paizes Move from HFW to Hill Dickinson in Greece

    Jasel Chauhan and Anthony Paizes Move from HFW to Hill Dickinson in Greece

    Former Holman Fenwick Willan Partner Jasel Chauhan and Senior Associate Anthony Paizes have moved to Hill Dickinson in Piraeus.

    Chauhan, who headed HFW’s Ship Finance and Corporate practices in Piraeus, joins Hill Dickinson as Head of International Finance as the firm looks to build on its presence in this area, with particular focus on the EMEA region. He has over ten years’ experience of corporate and finance transactions in the marine sector and has been based in Greece since 2009. His practice covers a range of cross-border corporate, finance, and commercial shipping transactions, and he acts for Greek and international ship owners, banks, private equity and financial institutions.

    Paizes, who moves along with Chauhan, is qualified in South Africa, England & Wales, Greece, and the Cayman Islands. 

    Hill Dickinson Chairman and Marine Group Head David Wareing said: “We are delighted to announce the strategic acquisition of a team which will broaden our offering and complement our existing strengths in the marine sector. Investment in our market leading sectors and services – both domestically and internationally – remains a key objective for the firm and this recruitment marks our commitment to investing in young and dynamic talent.”

    Hill Dickinson Greek Office Head Patrick Hawkins said: “As the Greek office approaches its 25th anniversary, I am very pleased to highlight our ongoing commitment to the Greek market and our expansion into an area which supports the evolving needs of our growing client base.”

  • Norton Rose Fulbright Advises Alpha Bank on Financing of Greek Onshore Wind Power Project

    Norton Rose Fulbright Advises Alpha Bank on Financing of Greek Onshore Wind Power Project

    Norton Rose Fulbright has advised Alpha Bank on the EUR 30 million non-recourse financing of a greenfield onshore wind power project developed by Eoliki Energiaki Achladotopos S.A., a Greek subsidiary of Total Eren, in Evia, Greece. Watson, Farley & Williams reportedly advised the sponsor.

    The project, consisting of six Siemens wind turbine generators, will have a total installed capacity of 19.2 MW, and it is expected to come online by October 2018. Norton Rose Fulbright describes it as “one of the very first projects that was financed under the new national support scheme for renewable electricity.”

    The Norton Rose Fulbright team was led by Partner Dimitris Assimakis, with assistance from Senior Associates Dimitra Giannoula and Minas Kitsilis and Associate Christina Korinthios. German law advice was provided by Partner Dirk Trautmann, Senior Associate Oliver Paasch, and Associate Matthias Zimmermann. Luxembourg advice was provided by Partner Stephane Braun and Of Counsel Cyril d’Herbes.

  • GDPR: A Perspective on Compliance Challenges Within Large Organizations

    With less than a month before it eventually rolls out across the EU, the GDPR is still treated by many businesses as a complicated piece of legislation triggering serious debate between professionals and regulators and imposing a heavy compliance burden for large organizations. However, the GDPR implementation date – May 25, 2018 – should be looked at more as a starting line rather than a hard deadline, providing organizations with the opportunity to map – through their search to identify any personal data processing – both their entire corporate life and their day-to-day operations.

    The initial key for any organization to start any compliance process should be raising internal awareness by asking experts and team leaders from across the organization to join forces and decide on the best GDPR-compliance and implementation practices, taking into account the actual needs and weaknesses of the business. It is crucial for the organization to invite all internal stakeholders on board, from the customer support service, to the human resources staff, up to the strategic intelligence unit, in order to jointly identify optimized implementation practices, set new standards, and gradually structure the business ecosystem upon which all actions and initiatives will be deployed.

    An additional fundamental exercise that any large organization should attempt prior to undergoing a comprehensive data audit should be to design an effective budget plan for the project. The organization should be prepared to commit valuable resources into the project in terms of time, manpower, and money, to assess its size and market exposure, the rough amount of personal data processed as part of its core business, and the extent of its interaction with third-parties and/or non-EU countries.

    The compliance project should commence as soon as the organization has received a gap analysis assessment from its trusted privacy advisor. This is a report setting out all elements identified during the assessment of the current status of the organization which are not compatible with the requirements of the GDPR. When it comes to the gap analysis assessment, organizations may choose between either a quick, tick-box, assessment, leading to a high-level implementation plan, or a quality assessment, including a more thorough examination of all frameworks, organizational aspects, strategies, and management practices that will produce a detailed data mapping portraying in full deployment the processes and flow of personal data within the organization. In any case, the assessment approach shall definitely depend upon the maturity level of the organization, the existence of written policies, and the actual implementation thereof. 

    The GDPR demands a radical shift in the corporate structure and mentality of the organization, as the relevant compliance process is extremely intrusive to the day-to-day life of businesses. It is this highly intrusive nature of the GDPR compliance procedure that makes organizations’ leadership reluctant to undertake compliance efforts and cooperate efficiently with their privacy advisors, especially when their compliance scheme entails interviews. In particular, when interviewed about their organizations’ operations, data processing and flow, and on their daily activities, executives frequently develop a defense response mechanism similar to the one used by people under interrogation, often invoking common avoidance excuses that they hope will disengage them from the interview process.

    However, as reality sets in, the GDPR looks more like an opportunity for businesses rather than a crisis point. The GDPR compliance process is a win-win situation for organizations, as it provides them with the opportunity to create business value, improve their operational structure, and eventually gain a competitive advantage. GDPR-compliant organizations will immediately get ahead of their industry competitors by attracting clients who value their data and wish to trust it to an organization sharing the same principles.

    In full awareness that reaching maturity levels may be a long process, organizations should ensure that their GDPR compliance is sustainable; such sustainability may be achieved through ongoing monitoring and assessment of the organization’s policies and operations, permanent training of staff, and developing of technical and operational measures that will ensure that the organization will always be in a position to demonstrate readiness and accountability.  

    By Michalis Kosmopoulos, Partner, Mariliza Kyparissi, Senior Associate, Drakopoulos   

    This Article was originally published in Issue 5.5 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

  • KG Advises EIB and Alpha Bank on Financing Wind Farms in Greece

    KG Advises EIB and Alpha Bank on Financing Wind Farms in Greece

    Kyriakides Georgopoulos has advised the European Investment Bank and Alpha Bank A.E. on the financing of two wind parks in northern Greece.

    According to KG Law, the financing was structured on a limited recourse project finance basis by means of a long term facility in the form of a hybrid bond loan governed by Greek bond law 3156/2003 and German law, along with relevant Greek law security documents for each project company. The European Investment Bank’s (EIB) loan is backed by the EU budget guarantee of the European Fund for Strategic Investments (EFSI), the financial instrument of the Investment Plan for Europe.

    The two wind parks will have a combined operating capacity of 44.4 MW, divided between Eressou Ipsoma-Fourka, with operating capacity of 36MW, and Lefkes-Kerasia, with operating capacity of 8.4MW. In total, the parks will host 22 wind turbines installed on complex high altitude terrain (exceeding 1400 meters), and will be connected to the transmission grid via a new MV/HV Substation and respectively 8.5 km and 16 km of MV underground cable.

    The KG team was led by Partners Ioanna Antonopoulou and Elisabeth Eleftheriades and included Counsel Elia Iconomidou, Senior Associates Aristotelis Katranis, Christina Chini, and Chrysoula Giannopoulou, Associates Angeliki Chalikia and Zaphirenia Theodoraki, and Junior Associate Maria-Thomais Epeoglou.

  • KG Law Advises Alpha Bank on Financing Acquisition of Sbokos Hotel Group

    KG Law Advises Alpha Bank on Financing Acquisition of Sbokos Hotel Group

    Kyriakides Georgopoulos has advised Alpha Bank on financing the acquisition of Golf Residencies SA, which owns and operates five luxury hotels and resorts formerly belonging to the Sbokos Hotel Group.

    According to KG Law, “the seller, the Sbokos Group, was part of a big family with many shareholders, and after the transaction, two of them remained in the scheme of the buyers, while the others exited.”

    The acquisition was led by the Vassilakis group in cooperation with several existing shareholders of the Group who retained both their stake and the management of the hotel operations.

    The KG team was led by Partner Theodore Rakintzis and included Senior Associate Christina Chini and Associate Maria Karampotsiou.

    Kyriakides Georgopoulos told us that the they were not permitted to disclose the identity of other law firms involved.

     

  • Karatzas & Partners and Zeya Advise on First Securitization of Greek Commercial Backed NPEs

    Karatzas & Partners and Zeya Advise on First Securitization of Greek Commercial Backed NPEs

    Karatzas & Partners has advised Bain Capital on the acquisition of a secured corporate NPE portfolio from Piraeus Bank equivalent to EUR 1.95 million of legal claims or EUR 1.45 million gross book value. Piraeus Bank was advised by Zepos & Yannopoulos.

    On May 29, 2018, Piraeus Bank S.A. announced that it had entered into an agreement with Bain Capital Credit LP regarding the sale of non-performing and denounced corporate credit exposures, secured with real estate collateral, also known as “Project Amoeba.”

    According to Zepos & Yannopoulos, “this pioneer transaction marks the long awaited opening of the secured NPE market in Greece following a series of legislative initiatives and regulatory NPE reduction targets in the last few years aiming to establish a liquid market for the nearly EUR  100 billion of NPEs of the Greek banks.”

    Partner at Zepos & Yannopoulos Christina Papanikolopoulou commented: “The Amoeba deal attests the Greek banks’ commitment to actively deleverage their balance sheets, as well as international investors’ interest to invest in Greek NPEs. The team worked very hard to propose and implement a seamless legal structure that would be familiar to the international investor community and which would serve as a robust and flexible toolbox for future transactions. Moreover, the number of investors that took an interest in the transaction went far beyond what would be expected in a first-time NPE deal, which is a very positive sign for the coming Greek NPE sales.”

    The completion of the transaction is subject to customary conditions, including regulatory and other approvals by the relevant authorities in Greece such as the Hellenic Financial Stability Fund.

    According to Karatzas & Partners, the transaction “is the first commercial real-estate backed NPE sale taking place in Greece and is predestined to set the mark for future similar transactions in the secured corporate loans space.” 

    Karatzas & Partners advised Bain Capital on all Greek law aspects of the structuring and implementation of the transaction. The firm’s team was led by Partner Nikos Fragos and included Partner Vassiliki Salaka, Senior Associate Katerina Dalamara, and Associates Eva Petroglu, Zefi Kosmidou, and Argyro Vagia.

    The Zepos & Yannopoulos team was led by Partner Christina Papanikolopoulou, assisted by Senior Associate Kely Pesketzi and Associates Mary Nigritinou, Athina Palli, and Paris Tzoumas. Tax advice was provided by Partner Daphne Cozonis and Senior Associate Katerina Vagia. Partners Nikos Christoforidis and Emmanuel Mastromanolis assisted with enforcement and insolvency laws, respectively. 

    Editor’s Note: After this article was published Shearman & Sterling announced that it had worked alongside Zepos & Yannopoulos in advising Piraeus Bank on the transaction and that Kirkland & Ellis and Andreas Angelidis & Associates had worked alongside Karatzas & Partners in advising Bain.

     

  • Karatzas & Partners Advises B2Holding on NPL Portfolio Acquisition from Alpha Bank

    Karatzas & Partners Advises B2Holding on NPL Portfolio Acquisition from Alpha Bank

    Karatzas & Partners has advised B2Holding on its acquisition of a portfolio worth EUR 3.6 billion from Alpha Bank in its first sale of under-performing and non-performing consumer and small business loans.

    According to Karatzas & Partners, the firm “advised B2Holding as participant bidder throughout the two-stage bidding process initiated by Alpha Bank, for the above sale and transfer of the portfolio, which initially had a value of total exposures of approximately EUR 2.5 billion.”

    During the second phase of the process, Alpha Bank expanded the transaction by adding a smaller portfolio (of similar characteristics) worth approximately EUR 1.1 billion.

    Karatzas & Partners did not reply to our inquiries on the matter. 

     

  • Greece: An Emerging Energy Hub in the SE Mediterranean

    Greece has long been a regional energy market. However, drastic changes have been taking place which have the potential to transform Greece to an energy hub in the South Eastern Mediterranean region. The first step was made with the inauguration of the Greek-Turkish gas pipeline at the beginning of the millennium.   

    Infrastructure Projects

    Important infrastructure projects – such as the TAP pipeline, which will transport Azeri gas via Greece to Italy, and the Euroasia Interconnector, which will connect the Electricity Transmission Networks of Greece, Cyprus, and Israel – are reshaping the Greek energy market. Such infrastructure projects will allow the Greek energy markets to become fully interconnected, and thus highly competitive. This development, combined with a set of important ongoing and anticipated oil exploration projects, could transform the Greek Energy Market into a truly mature market. A word of caution though: the on-time completion of projects is critical. Completing the infrastructure projects on time is not only a necessary prerequisite for the opening of the market, but would also send a strong signal to investors that the Greek State is dealing with these issues with the necessary determination.

    Liberalization of Electricity and Gas Markets

    In past years remarkable efforts have been made to liberalize the Greek energy markets. That said, although Greece has properly transposed the electricity and gas EU directives, due to structural inefficiencies and regulatory inadequacies, no real and satisfactory opening to competition has been achieved. However, this seems to be changing. 

    The Electricity Sector

    In the Electricity sector Greece has adopted legislative measures to fully implement the EU Target Model.  In the wholesale market, the mandatory pool system will be replaced by a new system, consisting of a day-ahead market, an intraday market, an imbalances market, and a financial term products market. These mechanisms will be coupled with an Energy Exchange created according to EU standards. Furthermore, new rules will apply to ensure the short and long term stability and security of the system. These new rules are compatible with EU requirements and will be based on the principle of competition in order to minimize the distortive effect. New rules will also apply, in line with EU approvals, for the promotion of renewable sources of energy (RES) projects. RES subsidization rules will allow the combination of high environmental standards with the principle of free competition. The entry of a strategic investor in the Transmission System Operator (TSO) has already been completed, and the TSO now operates according to the so-called “full ownership unbundling regime.” Market participants are responding positively and a private suppliers in the downstream market have developed an increasing market share.

    The Gas Sector

    Remarkable progress has also been made in the Gas sector. The privatizations of the incumbent operator (DEPA) and the Transmission Network Operator (DESFA) are ongoing and, once completed, will allow the implementation of the full ownership unbundling model in the gas sector as well. Perhaps most importantly, the unbundling of the gas distribution networks from supply activities has been completed and from January 1, 2018 onwards, all customers, both residential and industrial, are now able to choose their suppliers, which is expected to boost competition in the downstream markets.

    New Era for Oil Exploration and Exploitation

    In the Oil Exploration sector, important multinational operators have expressed a strong interest in several new tenders, including, in particular, the promising potential offshore oil fields in West Greece and the Crete Sea area. The Greek State has delegated the management of its exploration rights to a specialized entity – the Hellenic Hydrocarbon Resources Management SA (HHRM) – to promote the procedures for oil research, extraction, and exploration more efficiently. In parallel, the ongoing privatization of the dominant player in the Greek oil market – HELPE – is expected to generate additional market interest.  

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    The combination of all these developments could effectively transform Greece into a real energy hub in the Southern Mediterranean Area. Regulated industries such as energy markets are largely state driven. That does not mean that private initiatives are not necessary and extremely important. Inevitably, however, in order to be incentivized, investors need to have a regulatory framework that is clear, stable, and business-friendly, and which ensures a level playing field. Therefore, the willingness and determination of the Greek State to complete the ongoing projects and reforms in the Energy Sector both timely and effectively will be the decisive factor for achieving this ambitious objective.   

    By Vassilis Karagiannis, Partner, KLC Law Firm  

    This Article was originally published in Issue 5.2 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.