Key Takeaways
- • Law 5313/2026 introduces a modernized tax framework for Alternative Investment Funds (AIFs) domiciled in both EU and third-country jurisdictions, expanding Greece's competitive position as an investment fund establishment hub while tightening oversight requirements.
- • AIFs established outside Greece—whether EU or third-country based—now qualify for favorable tax treatment provided they maintain registered offices outside non-cooperative jurisdictions and hold supervision credentials from IOSCO-accredited authorities in their home countries.
- • Management, delegation of management, and portfolio management activities of eligible EU and supervised third-country AIFs are explicitly excluded from Greece's definition of "effective management," eliminating potential double-taxation exposure for fund managers and reducing compliance friction for international fund operators.
- • The legislation addresses the tax treatment of carried interest compensation paid to employees of Greek-established service providers working on behalf of EU and third-country AIF managers, modernizing remuneration frameworks within the fund industry.
- • The law encompasses broader real estate market tax reforms and updates to the foreign tax resident framework alongside AIF provisions, signaling comprehensive legislative overhaul of Greece's investment and property tax regimes.
Summary
Law 5313/2026, published in Greece's Government Gazette, represents a significant modernization of the country's tax framework governing Alternative Investment Funds and real estate investments. The legislation specifically targets Greece's competitiveness as a jurisdiction for fund establishment and management while simultaneously updating tax treatment for foreign residents and real estate market participants.
The law's centerpiece is a revised tax regime for AIFs that extends favorable treatment beyond EU-domiciled funds to encompass supervised third-country AIFs. Previously, tax incentives appear to have been more restrictive. Under the new framework, AIFs qualify for preferential treatment regardless of domicile—EU or third-country—provided two conditions are met: the fund's registered office must be located outside jurisdictions designated as non-cooperative tax havens, and the fund must be supervised by a competent authority in its country of establishment that holds accreditation from the International Organization of Securities Commissions (IOSCO).
A critical provision clarifies the tax treatment of fund management activities conducted in Greece. The legislation explicitly states that management, delegation of management, or portfolio management of eligible EU AIFs or supervised third-country AIFs does not constitute "effective management" being exercised in Greece. This distinction carries substantial implications for fund structures and tax residency determinations, as it prevents Greek-based management service providers from triggering additional Greek tax exposure on behalf of international funds. This treatment reduces compliance complexity and positions Greece as a transparent, administratively efficient hub for fund operations.
The law also modernizes the tax treatment of carried interest remuneration paid to employees of Greek-established entities that provide services to EU AIF managers or supervised third-country AIF managers. This provision suggests a deliberate policy to attract fund management infrastructure and talent to Greece while maintaining tax competitiveness relative to other European financial centers.
Beyond the AIF provisions, Law 5313/2026 addresses broader real estate tax reforms and updates to the taxation framework for foreign tax residents, though detailed specifics on these components remain beyond the scope of the primary source materials reviewed.
The law's centerpiece is a revised tax regime for AIFs that extends favorable treatment beyond EU-domiciled funds to encompass supervised third-country AIFs. Previously, tax incentives appear to have been more restrictive. Under the new framework, AIFs qualify for preferential treatment regardless of domicile—EU or third-country—provided two conditions are met: the fund's registered office must be located outside jurisdictions designated as non-cooperative tax havens, and the fund must be supervised by a competent authority in its country of establishment that holds accreditation from the International Organization of Securities Commissions (IOSCO).
A critical provision clarifies the tax treatment of fund management activities conducted in Greece. The legislation explicitly states that management, delegation of management, or portfolio management of eligible EU AIFs or supervised third-country AIFs does not constitute "effective management" being exercised in Greece. This distinction carries substantial implications for fund structures and tax residency determinations, as it prevents Greek-based management service providers from triggering additional Greek tax exposure on behalf of international funds. This treatment reduces compliance complexity and positions Greece as a transparent, administratively efficient hub for fund operations.
The law also modernizes the tax treatment of carried interest remuneration paid to employees of Greek-established entities that provide services to EU AIF managers or supervised third-country AIF managers. This provision suggests a deliberate policy to attract fund management infrastructure and talent to Greece while maintaining tax competitiveness relative to other European financial centers.
Beyond the AIF provisions, Law 5313/2026 addresses broader real estate tax reforms and updates to the taxation framework for foreign tax residents, though detailed specifics on these components remain beyond the scope of the primary source materials reviewed.
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