The HCMC sets out qualifications for the recognition of corporate governance codes to be mandatorily adopted on the basis of the ‘comply or explain’ principle

On 1 April 2021, the HCMC published its Decision No 2/905/3.3.2021, providing clarifications and guidance on Article 17 of the new Corporate Governance Law No 4706/2020. Article 17, set to be applicable to all Greek listed issues from 17 July, 2021 onwards, provides that Greek listed issuers are obliged to adopt a CG Code prepared by a ‘body of recognized status’; the new HCMC decision inter alia: (i) provides background on the meaning of the term ‘bodies of recognized status’ and the respective qualifications; (ii) clarifies that such bodies must have been officially recognized by the HCMC for being able to be adopted by Greek issuers; (iii) determines that non-Greek CG Codes can obtain such recognition too, in which case the relevant application can also be filed by the issuer itself on behalf of the issuing body; and (iv) states that the ‘comply or explain’ principle still applies in respect of the implementation of the CG Code selected by the relevant issuer.
The upcoming entering into force of the new corporate governance regime in Greece changes the landscape in the Greek capital market, as on the one hand issuers are struggling to complete their preparations by July 2021, while investors are seeking to explore the increased opportunities offered by the enhanced transparency framework.
For more information on corporate governance requirements in Greece, you can contact Michael Tsibris, Giannis Koumettis, or Hara Kora of our firm.