Tax Law 4110/2013 was circulated in the Govt. Gazette on 23th January 2013. Aside from some major amendments on taxation of natural person and corporate income taxation, the new law includes an improvement of the Greek transfer pricing regulatory regime, and initiates a new APA program.

The new law will be applicable to all Greek corporation and permanent establishments for accounting periods starting on or after 1^st January 2012 and the APA program will apply for accounting periods starting on or after 1^st January 2014.

The definition of the meaning of affiliated enterprises has been expanded to include cases where even the likelihood of mere influence, rather than dependence or control on one of the affiliated enterprises exists.

According to the new law, the arm’s length principle will be applicable to transfer of shares, the loan agreements, and parts or joint ventures or participation percentages in civil law society and real estate realized between a Greek company and its affiliated companies but the precise application and documentation requirements are not clarified. Furthermore, the compliance obligation with respect to the arm’s length principle has been expanded to the prices of intra-group transactions between Greek enterprises and their foreign permanent establishments, as well as transactions of Greek permanent establishments of foreign enterprises with their affiliated entities abroad.

The closing date for the preparation of transfer pricing documentation has been set to “within 50 days” from the end of the accounting period by the new Law and a summarized table of transfer pricing information is required to be submitted electronically to the Greek Tax Authority within the same time-frame.

According to the new Law, audits will be conducted in harmony with the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations together with the guidelines of the Greek tax authority. Transfer pricing documentation will have to be provided to the tax authority within 30 days from the date of issue of a notice requesting submission of the company’s documentation.

The new law gives options to companies to obtain an Advance Pricing Agreement (APA), covering the transfer pricing methodology of specific future intra-group transactions and the maximum duration of the APA will be 2 years with the option of its renewal for a further four years.