Summary of Law 4444/2016
In 2016, Law 4430/2016 (Government Gazette Α΄205) "Social and Solidarity Economy and Development of its Entities and Other Provisions" was adopted, which is the first law to attempt to regulate the functioning of the Social and Solidarity Economy entities. in the country. The agencies of Social Economy are no longer defined by their legal form, as any legal form can be accepted to qualify as a Social Enterprise organization if it fulfills the criteria set by law. The criteria concern doing business in the private market (eg public sector revenue should not exceed 65 percent of total turnover / turnover within three years), a democratic decision-making system and a well-defined social purpose, with profits distributed for the benefit of the community and society (up to 95 percent of the annual profit).
Specifically, Social Economy Organizations are:
1. The Social Cooperative Enterprises , which are divided into:
(a) Inclusion of Special Groups;
(b) Inclusion of Vulnerable Groups;
(c) Collective and Social Benefits.
2. Workers' Associations, which are introduced in the Greek legal order for the first time.
3. Any other non-sole proprietor (such as in particular agricultural and urban cooperatives, urban corporations of No. 741 AK, etc.), provided that:
a) Develops activities of collective and social interest.
(b) It shall ensure the information and participation of its members and shall apply a democratic decision-making system, in accordance with the principle of one member having one vote, irrespective of the contribution of each member.
(c) It applies restrictions on the distribution of its profits (at least 5% is reserved, up to 35% is allocated to the Agency's employees and the remainder is allocated to the creation of new jobs and the expansion of its productive activity).
d) It applies a convergence system to the remuneration of labor, in which the maximum net salary cannot exceed three times the minimum, unless two-thirds of the members of the General Assembly decide otherwise. This obligation also applies in any form of partnership between two or more Social Enterprises.
e) It has not been established and is not directly or indirectly governed by law or a legal entity of the wider public sector.
The institutional framework simplifies the procedures related to the establishment of Social Economy bodies and activates a number of supportive measures, such as:
- the possibility of concluding programmatic contracts with the wider public sector for projects and studies explicitly mentioned in their statutory purposes,
- granting use of stagnant public real estate,
- tax reliefs,
- favorable access of the Social Enterprises in public procurement through Law 4412/2016 (Α΄147).
You can find detailed information on the Institutional Framework for the establishment and operation of a Social Enterprise