Why Creating a Trust in Your Will About Your Greek Estate is not a Good Idea


It is not very often that a lawyer in Greece has to advise about a Trust which has been established by the Will of a deceased. This is primarily because the legal notion of the Trust, is non-existent in the Greek legal world, which follows the continental law system and does not have many common aspects with common law legal systems (like US, English, Australian law, etc.).

It is for this reason that Wills which create a Trust are not easily applicable in Greece, they create confusion at the tax authorities and with other public administration offices and are interpreted or adjusted to Greek law with difficulty.

Of course the Greek legal system has other notions which are similar to some aspects of the Trust, and a Greek lawyer usually tries to apply them, at least by analogy, so that the Trust stipulations are observed and the Greek authorities and the courts can adapt those stipulations in the Greek legal order.

Applying the trust terms of a Will in Greece means that we have first to persuade the taxman to accept our interpretation, since it is the tax authority the first agency in Greece which must be convinced about the proper inheritance order, so that the inheritance taxes (if any) can be imposed and collected.

It is then a Greek notary who must also be convinced about the proper or modified application of the trust terms into the Greek

legal order, so that the Acceptance of Inheritance, a valid deed under Greek law, can be drafted and then signed by the heirs. In order to achieve this, the notary must be convinced that we apply the law wisely and logically, that each heir inherits his/her share appropriately and that anyone who will read in the future this deed (the Acceptance of the Inheritance) must be satisfied that title has orderly passed from the deceased to the heirs.

In some situations even the director of the local public registry, where all deeds regarding real estate transactions are registered, must also be convinced that everything has been done according to Greek law and ownership rights are observed, according to the Greek legal tradition.

Finally, but very importantly, the legal advisor of a future buyer of the inherited property, must also be convinced that the inheritance rules have been followed and the heir, who is now trying to sell his share, is a proper owner of the inherited property. If the lawyer of a prospective buyer is not satisfied that the heir who is now selling is a true and unquestionable owner of the property, he will probably advise his client against buying the inherited property, because the transfer of legal title may have not taken place according to Greek law.

In many cases, the Greek courts must also rule on how we apply a Will which talks about the creation of a Trust regarding property in Greek territory. In such a case and especially if the deceased was a non-Greek citizen, the Greek court will apply the law of the country of citizenship of the deceased and not Greek law. This means that in the case of a British national who died in Greece leaving a Will which creates a trust regarding the deceased’s assets in Greece, the Greek court will seek legal advice from a British jurist on the inheritance law of G. Britain, in order to apply it in Greece and solve the inheritance riddle and who inherits what of the Greek property.

The above thoughts lead us to the conclusion that anyone who is contemplating to make a Will about his/her Greek property should avoid to include in his/her Will any term having to do with a Trust. There are many legal notions in Greek law which satisfy any type of wish or complexity that the testator may have in mind, (even tax wise), always within the law, so that the Will is practically applicable in the Greek legal order, by the courts, by the tax authority, by the notary and by the public registry for real estate deeds.

(Posting date 13 October 2006)

*Christos Iliopoulos is an attorney at law, LL.M., in Athens, Greece, specializing in International and European Business Law. For more information about him, see his brief biographical sketch under the HCS section for Contributing Authors at http://www.helleniccomserve.com/christosiliopoulosbio.html. He has submitted many articles to HCS; readers can browse these in the archives section bearing his name at the URL http://www.helleniccomserve.com/archiveiliopoulos.html. He can be contacted by e-mail at bm-bioxoi@otenet.gr or by phone (from the US) 011-30-210-6400282; mobile 011-30-693-2775920, fax 011-30-210-6400282, or by postal mail at the address: 105 Alexandras Ave., Athens, 11475, HELLAS

HCS readers may wish to view other articles about Greek property laws and taxes in the Greek Laws and Procedures section of our archives at http://www.helleniccomserve.com/archivegreeklawsnprocedures.html

HCS encourages readers to view other articles and releases in our permanent, extensive archives at the URL http://www.helleniccomserve.com/contents.html.

2000 © Hellenic Communication Service, L.L.C. All Rights Reserved.