This article reviews Law 5123’s key provisions.
"A pledge can be established by private agreement with a certified date (such as a notarial agreement) or by an electronic document."
A pledge can be established by private agreement with a certified date (such as a notarial agreement) or by an electronic document. Pledges should now be registered with the new electronic registry of pledges operated by public law legal entity Hellenic Cadastre (the “Electronic Pledge Registry”). As an exception, no registration is required for accounts’ pledges as long as they are kept with the lending bank. The above also applies to non-pecuniary claims for the transfer of ownership of moveable property.
The registration of pledges in the new Electronic Pledge Registry was enacted to overcome legal uncertainty and the lack of transparency of the previous regime.
A pledge should be notified to the debtor by the pledgor or the pledgee by a court bailiff or electronic means (e-mail etc.) regularly used by the debtor. Apart from notification, the pledge agreement can be registered automatically to the debtor’s e-mail at gov.gr connected to the Electronic Pledge Registry.
No notification is required, if the debtor is also the pledgee or pledgor or, alternatively, a party to the pledge agreement (Article 6).
The pledge becomes effective:
Counsel Athens
Counsel Athens
Senior Knowledge Lawyer Athens
"It aims to safeguard the safety of transactions and provide public access to a unified registry."
The pledgee has the right to collect, without any further proceedings being required, the pledged claim following the lapse of ten business days from the date the secured claims became due and payable (partially or in total) (Article 9). This is a significant new provision, as the pledgee is facilitated to proceed with the collection of the pledged asset or claim within a very short period and without any judicial act been required.
Ιf a third party initiates enforcement proceedings on the pledged claim, the debtor must notify it with a declaration about the existence of a pledge in accordance with the Greek Code of Civil Proceedings.
Α pledge on a registered share is created by a private or electronic document and with its registration in the Electronic Pledge Registry. The pledge shall be registered in the Electronic Pledge Registry after its registration in the shareholders’ book and a notice which should be made on the registered shares if these are issued in physical form.
A pledge on the share units of limited liability companies, private companies’ participation and interests in joint ventures takes place through a private or electronic document. The notification of the pledge to the company or joint venture must be signed by the pledgee and the pledgor in writing and can be made by e-mail. The company’s administrator must register the pledge on the shareholders’ book. The pledgor or the pledgee shall register the pledge in the Electronic Pledge Registry.
A pledge can be established on moveable property without delivery of possession by an agreement between the owner and the borrower which is registered with the Electronic Pledge Registry by either party. The agreement is made by private or electronic document. Towards third parties, the pledge is valid from its registration in the Electronic Pledge Registry.
Chapter E of Law 5123 introduces a significant new legal tool in the unified Electronic Pledge Registry managed by Hellenic Cadastre. The Electronic Pledge Registry operates as an online public service through the website gov.gr. It aims to safeguard the safety of transactions and provide public access to a unified registry.
From the entry into force of the Electronic Pledge Registry, it will be obligatory to register, among others, all pledges, amendments and releases thereof.
The particulars of operating the Electronic Registry of Pledges, procedures for submitting agreements to be registered, the legalisation documents accompanying each registration, application, the applicable registration fees and the procedures for issuing certificates and extracts from the Registry’s records, will be agreed by Hellenic Cadastre’s’ Board of Directors (“BoD”).
Finally, Law 5123 will come into force on the date of publication of the above decision by Hellenic Cadastre’s BoD or the 31st of December 2024, whichever comes first.
Any pledges established in accordance with the legislative provisions abolished by Law 5123 (including Articles 1244, 1247 and 1248 of the Greek Civil Code and Article 36 of legislative decree 17.7/13.08.1923) will continue to be valid and regulated by the abolished provisions pursuant to which they have been established.
Counsel Athens
Counsel Athens
Senior Knowledge Lawyer Athens
