A ministerial decision signed by Development Minister Panagiotis Theodorikakos establishes clear parameters for what constitutes a breach of the law, as well as the specific penalties that will follow. This move is part of a broader effort to ensure that public funds used to support private investments deliver on promised economic and employment outcomes.
The changes respond to growing concerns about companies receiving public support only to later disregard their long-term obligations—such as job creation targets, transparent financial reporting, or continued operations. In practice, violations have ranged from incomplete bookkeeping and failure to hire pledged staff, to the unapproved sale or relocation of subsidized assets.
Under the new framework, companies that fail to create the agreed number of new jobs could be required to repay part of their subsidy. For example, a company that promised to create 10 new jobs but only filled half of them two years after completing the investment may have to return €8,000 for each missing position, for every remaining year it was contractually obligated to maintain those jobs. Additional penalties apply if companies fall short of hiring enough university graduates in cases where their subsidy was contingent on it. A deviation of more than 20% from the agreed graduate employment ratio could lead to annual fines equivalent to 2% of the total subsidy.
There are also new rules for companies that reduce their existing workforce during the subsidy monitoring period. If a firm cuts jobs it had before receiving support, it will be required to repay €4,200 for each eliminated position, per year of non-compliance.
Financial transparency and proper accounting are also being strictly enforced. If companies fail to keep proper financial records or cannot clearly separate investment-related expenditures from their general operations, they may face penalties of up to 10% of the subsidy. In more severe cases, where these discrepancies account for more than 30% of the total financial aid received, the government can revoke the entire subsidy agreement and demand full repayment.
Fraudulent or misleading applications are met with zero tolerance. If a company is found to have submitted false information or withheld key data in its funding application, its subsidy approval will be immediately annulled and all funds must be returned. The same consequences apply to unauthorized relocation of the investment, unapproved leasing of subsidized facilities, or asset transfers without proper replacement.
The rules also apply to changes in a company’s ownership or legal structure. Businesses that initially qualified for subsidies under the status of small, very small, or newly established independent enterprises but later undergo ownership changes that make them ineligible will lose the subsidy or be required to repay the difference—plus a 10% surcharge.
According to the ministry, these reforms are intended to safeguard the credibility and effectiveness of the Development Law as a tool for sustainable economic growth. All financial recoveries will now be enforced through Greece’s public revenue system, with interest and surcharges, further emphasizing the seriousness of the law’s enforcement.
The penalties and sanctions outlined in the new framework will apply to any violations discovered within ten years from the official date marking the investment’s completion and the start of its operations.
