Up to 75% Funding: The 3rd Cycle of the “Manufacturing – Supply Chain” Scheme under Development Law 4887/22 has been Announced Total Budget: 150 million €

Introduction

The 3rd cycle of the “Manufacturing – Supply Chain” scheme has been officially announced. This program aims to support investment projects in the manufacturing sector—excluding the processing of agricultural products—as well as in the broader supply chain industry. The main objective is to strengthen the competitiveness of Greek businesses both in the domestic and international markets.

The total budget amounts to 150.000.000€, of which 75.000.000€ will be allocated as tax exemptions, while the remaining 75.000.000€ will cover grants, leasing subsidies, and wage cost subsidies for new employment positions. Funding for the scheme comes from the Public Investment Budget of the Ministry of Development.

Eligible Beneficiaries & Participation Requirements

Eligible beneficiaries under the “Manufacturing – Supply Chain” scheme are investment entities operating or intending to operate within the Greek territory at the time of commencement of their investment project and having one of the following legal forms:

Specifically, eligible beneficiaries include:

• Commercial companies (S.A., Ltd., Private Company (IKE), General Partnerships (O.E.), Limited Partnerships (E.E.), etc.),
• Cooperatives,
• Social Cooperative Enterprises (Koin.S.Ep.), Agricultural Cooperatives (AS), Producer Groups (OP), Urban Cooperatives, and Agricultural Corporate Partnerships (AES),
• Companies undergoing a merger, provided that the required publicity procedures have been completed before the commencement of the investment project,
• Joint ventures engaged in commercial activity,
• Public and municipal enterprises, as well as their subsidiaries, provided that:
  • They have not been assigned a public service obligation,
  • They have not been exclusively entrusted by the state with the provision of specific services,
  • Their operations are not publicly subsidized during the maintenance period of the long-term obligations associated with the investment.

The “Manufacturing – Supply Chain” scheme covers investment projects of an integrated initial investment nature, implemented in the manufacturing sector (excluding the processing of agricultural products) and in the supply chain sector. To be considered eligible, the investment activity must fall under the eligible Activity Codes (NACE), as defined in the National Classification of Economic Activities.

The types of investment projects eligible for funding under this scheme include:

1. Establishment of a new production unit: Creation of a completely new manufacturing facility.
2. Expansion of the production capacity of an existing facility: Investments aimed at increasing the productive capacity of an existing manufacturing unit.
3. Diversification of the production of an existing facility: This refers to the introduction of new products or services that have never before been produced or provided by the specific facility. A key condition for eligibility is that the supported eligible costs must exceed at least 200% of the net book value of the assets that are being reused, as recorded in the fiscal year preceding the submission of the investment application.
4. Fundamental change in the overall production process: Investments that involve a radical modernization of the production process. For large enterprises, an additional eligibility condition applies: the eligible expenses must exceed the depreciation charges of the assets related to the activity being modernized, as recorded over the past three fiscal years. If the depreciation data related to the activity cannot be clearly demonstrated, this requirement is considered not to be met.

Fundamental Eligibility Condition for Potential Beneficiaries – Incentive Effect Requirement

The aid granted under this scheme functions as a genuine incentive for undertaking investments only if the investor (beneficiary) submits a formal written application for inclusion prior to the commencement of any work or activity related to the investment project. This means that the submission of the application is a fundamental precondition for establishing that the aid has had an actual incentivizing effect on the implementation of the investment.

If the beneficiary has already initiated any works or activities linked to the investment project before submitting the application, the application is automatically deemed ineligible and is rejected. Moreover, even if an initial approval is granted, the decision may be revoked by the competent authorities at any stage of the project, should it be determined that project activities had commenced prior to the submission of the application.

This requirement is subject to verification within a defined time frame following the completion of the investment, to ensure that the aid scheme operates effectively as an investment incentive and does not subsidize projects that had already commenced without prior approval.

Project Budget, Aid Amount & Aid Intensity

The minimum investment thresholds vary according to the size of the enterprise or the type of entity submitting the proposal. Specifically, the requirements are as follows:

1. For large enterprises, the minimum investment threshold is set at €1,000,000. This means that projects with a lower budget will not be eligible for funding under this scheme.
2. Medium-sized enterprises must submit investment projects with a minimum amount of €500,000 to meet the participation criteria.
3. Small enterprises have a threshold of €250,000, while very small enterprises must propose projects with a budget of at least €100,000.
4. Special provisions apply to social economy entities such as Social Cooperative Enterprises, Agricultural and Urban Cooperatives, Producer Groups, and Agricultural Corporate Partnerships, which may submit investment projects starting from €50,000 and upwards.

Furthermore, the aid intensity rates applicable to eligible expenses are determined based on the maximum limits set out in the Regional Aid Map, as detailed below:

The aid intensities are determined according to the size of the enterprise and the region where the investment is implemented. The main distinction is as follows:

Specific Rules per Incentive Type

• For very small, small, and medium-sized enterprises, all incentives—except for grants—are provided at the maximum intensity level set by the Regional Aid Map (RAM).
• Grants, however, are provided at 80% of the maximum percentage defined by the RAM.

For specific categories of investment projects, the grant may reach up to 90% or even 100% of the maximum intensity of the RAM.

For Large Enterprises

• Incentives are granted at 80% of the maximum aid intensity, except for specific categories of investment projects, where they may reach up to 100% of the maximum percentage defined by the Regional Aid Map (RAM).

Aid Intensities for Specific Categories of Investment Projects

Increased aid intensities apply for investment projects that:

• Are implemented in mountainous areas (excluding the urban agglomerations of Attica),
• Are located near national borders (within a distance of up to 30 km),
• Are carried out on small islands with fewer than 3,100 inhabitants,
• Concern the reopening of an inactive industrial unit, provided that the fixed equipment of the old unit covers at least 50% of the total investment cost.

Maximum Aid Amount

The maximum amount of aid that each investment project may receive is up to €20,000,000.

Types of Aid

• Tax exemption
• Grant
• Subsidy for financial leasing (Leasing subsidy)
• Wage cost subsidy for new employment

Main Categories of Eligible Expenditures for Regional Aid

The eligible expenditures of the investment projects, for which regional aid is granted, include the following main categories:

1. Investment Expenditures in Tangible Fixed Assets
These primarily concern the following:

• Buildings and Facilities: Expenses related to the construction, expansion, and modernization of buildings, special and auxiliary facilities, landscaping of surrounding areas, as well as accessibility works for persons with disabilities.
  Limitation: The maximum aid intensity for building expenses cannot exceed 45% of the total eligible regional expenditure. This percentage increases to 70% for investment projects in the Logistics sector (NACE code 52.29.19.03).
• Purchase of Existing Fixed Assets: Funding may be provided for the acquisition of buildings, machinery, and equipment from closed (inactive) business establishments, under cumulative conditions:
  • The unit must have ceased operations.
  • The buyer must have no relationship with the seller (except in cases where small businesses are acquired by former employees).
  • The transaction must be conducted at market prices, and any prior subsidies related to the same assets must be deducted.
• New Machinery and Equipment: Includes purchase and installation of new technological equipment, intra-unit transportation vehicles, and technical installations.
• Leasing of Machinery (Financial Leasing): Leasing payments for new equipment are eligible, provided that ownership of the equipment transfers to the investor at the end of the lease term.
• Modernization of Specialized Installations: Expenses related to the modernization of specialized production or mechanical installations not directly related to building infrastructure are also supported.

2. Investment Expenditures on Intangible Assets
Eligible expenditures on intangible assets primarily concern the technological upgrade and organizational improvement of the enterprise. Specifically:

Eligible Categories of Intangible Expenditures:

• Technology Transfer: Expenses related to the acquisition of:
  • Intellectual property rights.
  • Exploitation licenses.
  • Patents.
  • Know-how and non-patented technical knowledge.
• Quality Assurance and Control Systems: Support is provided for the acquisition and installation of:
  • Certification systems.
  • Software.
  • Systems for the organization and internal processes of the enterprise.

To be considered eligible, intangible expenditures must meet the following criteria:

• Exclusive Use: They must be used solely within the supported business establishment.
• Connection to the Investment: They must remain linked to the specific investment project for which the aid was approved and be maintained as fixed assets of the enterprise throughout the period of compliance with long-term obligations.
• Depreciable Assets: They must be recorded as depreciable assets in the company’s accounting records.
• Purchase from Independent Third Parties: The acquisition must be made at market prices and only from suppliers who are independent and not related parties to the purchaser.

Percentage Limitations:

• For Large Enterprises, eligible expenditures on intangible assets cannot exceed 30% of the total eligible regional aid expenditures.
• For Small and Medium Enterprises (SMEs), the corresponding limit is 50%.

3. Wage Costs for New Jobs
The wage costs of new jobs created exclusively as a result of the investment project are subsidized for a period of two years from the creation of each position. This includes salaries and employer social security contributions, provided that the jobs are genuinely new and that these costs have not been previously funded by other programs.

Main Categories of Eligible Expenses Outside Regional Aid

This specific category of expenses is governed by a different intensity of aid compared to regional subsidies and includes the following types of expenses:

• Expenses for consulting services provided to SMEs.
• Expenses for energy efficiency measures. Costs related to energy efficiency measures are covered only when they concern additional investments necessary to achieve a higher level of energy performance. Anything that does not directly contribute to this goal is not considered eligible. Furthermore, no financial support is provided for projects that merely implement already established and effective EU compliance standards.
• Expenses for the installation of efficient district heating and/or cooling systems. Costs for installing efficient district heating and cooling systems are considered eligible when they relate to the construction or upgrade of a system that is or will become energy-efficient. Funding covers exclusively projects that improve or expand such systems. If the system has not yet achieved full energy efficiency due to ongoing work on the distribution network, then the additional improvements needed to meet energy performance criteria must be implemented within three years from the start of these works.
• Expenses for environmental damage remediation, restoration of natural habitats and ecosystems. For investments concerning environmental damage remediation or the reconstruction of natural habitats and ecosystems, eligible costs include related remediation or restoration works, after deducting the increase in land or property value resulting from these interventions. Expenses related to the restoration of areas damaged by natural disasters such as floods, earthquakes, or fires, as well as those connected with the restoration of sites due to the cessation of operation of power plants, mines, or extraction activities, are not eligible.
• Expenses for efficient resource use and support of the transition to a circular economy. Eligible expenses refer to additional investments arising when comparing the total cost of a project with a similar project or activity that is less environmentally friendly, which falls under one of the following categories:
  • A counterexample is a similar investment that could reasonably be implemented either in a new or existing production process without requiring a subsidy but does not ensure the same level of resource efficiency.
  • A counterexample is the treatment of waste by a method ranked lower in the waste management hierarchy, as defined in paragraph 1 of article 4 of Law 4819/2021 (Official Gazette A’ 129), or the treatment of waste, products, materials, or substances in a less resource-efficient manner.
  • A counterexample is investment in a conventional production process based on primary raw materials or feedstock, provided that the secondary product produced — either reused or recovered — can be technically and economically replaced by the corresponding primary material.
• Expenses for professional training.
• Expenses for SME participation in trade fairs.
• Expenses for hiring employees from disadvantaged groups and employees with disabilities.
• Expenses for investment incentives to SMEs.

Non-Eligible Expenses

• Operating expenses of the investment project.
• Purchase of office furniture and equipment, unless these constitute a fundamental part of the productive equipment of the investment.
• Purchase of passenger cars with up to six (6) seats.
• Purchase of plots, land, and agricultural parcels. In case of acquisition of building facilities, the portion of the expense related to the value of the land on which these buildings are constructed cannot be subsidized.
• Contribution to the corporate capital of real estate, machinery, and other fixed assets.
• Construction or expansion of buildings on land not owned by the investment entity is not considered an eligible expense, except if the land has been granted by the State or a General Government entity, as defined in Article 14 of Law 4270/2014 (A’ 143). Alternatively, it is allowed if the land has been leased from a public or private entity, either natural or legal person, or if a superficies right has been acquired for this specific purpose. The duration of the lease or superficies right must cover the period defined in paragraph (b) of Article 25 concerning long-term obligations, plus an additional four (4) years from the official completion date of the investment. These leases can also be formalized by a private document, provided that they are electronically registered on the Independent Authority for Public Revenue (IAPR) platform and the agreement is recorded at the competent land registry office or entered into the Cadastre, according to the legislation.

Scoring Criteria

The scoring criteria under the “Manufacturing – Supply Chain” scheme (Law 4887/2022) are divided into four distinct evaluation groups, as outlined below:

Group A: Assessment of the Investment Project’s Maturity (Score range: 0–42 points)

This group evaluates factors demonstrating the readiness of the investment for implementation, such as:

• Availability of the installation site.
• Submission of applications for environmental permits, pre-approvals, and building permits, as well as applications for revisions or installation licenses.
• Priority is given to projects located within organized industrial and business zones.
• Next in ranking are projects situated within designated but not fully licensed areas.
• Finally, investments outside these areas receive lower scores.

Group B: Assessment of the Financial Profile of the Investment Entity (Score range: 0–25 points)

The evaluation process differs depending on whether the investment entity is an existing business or a newly established one:

• For existing entities, financial ratios are calculated based on the average values of the financial figures reported in the two (2) most recent closed fiscal years prior to the submission of the aid application.
• For newly established entities, the assessment is based on the financial figures of their shareholders/partners from the two most recent closed fiscal years, as follows:
  • Corporate Shareholders/Partners: In cases where legal entities hold more than 25% of the investment entity’s share capital, the cumulative financial figures of these companies from the last two fiscal years are taken into account.
  • Individual Shareholders/Partners with holdings in other companies: If individuals hold more than 25% in the investment entity and also more than 25% in other companies, the financial figures of these other companies are also cumulatively considered.
  • Individual Shareholders/Partners with Executive Management Experience: If individuals hold more than 25% in the investment entity, do not hold more than 25% in other companies, but have exercised executive management responsibilities (e.g., CEO, Executive Chairman) in other companies for at least six months per year, then the financial figures of those companies where they held such positions are also taken into account.

Group C: Assessment of Sustainable Development Elements (Score range: 0–18 points)

The scoring for Group C is based on two main criteria:

• STEP Seal Index: This criterion evaluates the existence of certifications related to environmental management, corporate social responsibility, and sustainable development.
• Export Orientation Index: This index is calculated as the average export ratio of the company based on the two most recent closed fiscal years prior to the submission of the aid application. The higher the export ratio, the higher the score awarded.

Group D: Assessment of Employment Increase (Score range: 0–15 points)

The score in this group is determined by the number of new full-time equivalent (FTE) jobs to be created as a direct result of the investment project, relative to the total eligible investment cost (calculated per thousand euros of eligible expenditure).

The more jobs created in proportion to the level of investment expenditure, the higher the score awarded.

Submission Period, Method of Application, and Implementation Duration of Investment Projects

The submission period for applications under the current aid scheme starts on July 1st, 2025, and ends on September 10th, 2025. Applications must be submitted electronically through the Development Laws Information System (DLIS) and lodged with the following competent authorities:

• For investment projects with a total budget ranging from 1.000.000€ to 3.000.000€, implemented within the Regions of Macedonia and Thrace, applications shall be submitted to the Directorate of Private Investments of the Ministry of Interior, Macedonia – Thrace Sector.
• For all other investment projects, applications shall be submitted to the General Directorate for Development Laws and Foreign Direct Investments of the General Secretariat for Private Investments, Ministry of Development.

For further information regarding the new State Aid Scheme – Manufacturing and Supply Chain, part of the revised Development Law 4887/2022, and for support in planning your investment projects, please feel free to contact us at +30 2310 552000, +30 210 9580000, or via email at [email protected].