How are the main state-owned ports managed?
The main state-owned ports are managed and operated by corporatized port authorities (Sociétés Anonymes) that have been awarded long-term concessions by the Greek State. This means that the Greek state maintains the ownership of the ports and moreover it introduces professional management structures, through the creation of autonomous legal entities. It is envisaged that in the future Port Authorities may be joined to form the following Central Port Networks: a. the Attica Port Network (Port Authorities of Piraeus, Lavrio, Elefsina and Rafina), b. the Northern Greece Port Network (Port Authorities of Thessaloniki, Kavala, Alexandroupoli and Volos), c. the Western Greece Port Network (Port Authorities of Patra, Igoumenitsa and Kerkyra) and d. the Herakleion Port Authority.
What is the legal status of the ports of Piraeus and of Thessaloniki?
“PIRAEUS PORT AUTHORITY S.A.” (“PPA”) and “THESSALONIKI PORT AUTHORITY S.A.” (“TPA”) are legal entities initially established as public law legal entities and now operating in the form of Greek sociétés anonymes, which are subject to state supervision, operating in accordance with the rules of market economy and having as purpose the management and exploitation of the port of Piraeus and of Thessaloniki respectively. PPA and TPA have entered with the Greek State into concession agreements (both ratified by Law 3654/2008), by virtue of which they were granted the exclusive right to use and exploit the land, the buildings and the infrastructure of the land port area of the Piraeus and Thessaloniki Ports, as well as the right to enter into sub-concession agreements with third parties for the appropriate consideration. An important state aid decision (SA 28876) was issued in March 2015 regarding such a sub-concession agreement, namely the sub-contract for port management services by PPA to Piraeus Container Terminal (“PCT”). In November 2008, following a European public tender for port management services, PPA signed with PCT a concession agreement (ratified by Law 3755/2009). The European Commission ordered Greece to recover incompatible aid from port operator PCT as it concluded that certain fiscal benefits granted by Greece in favour of PCT and its parent company Cosco Pacific Limited (Cosco) provided the beneficiaries with an undue advantage over their competitors in breach of EU state aid rules. These benefits include tax exemptions and preferential accounting treatment. Accordingly, the companies now need to pay back the advantage received to the Greek state. Moreover, to avoid further distortions of competition, the Greek authorities are also expected to cease granting these advantages to PCT from now on. The Commission decision has been challenged before the General Court of the EU (case T-314/15, Greece vs. Commission); the case is pending.
What is the main operation of the major state-owned ports?
The main operation of the major state-owned ports is to provide services like cargo-handling and passenger traffic. The port of Piraeus, as the biggest and most important port in Greece, is engaged in several sectors of port activity, such as operation of container terminals, car terminal, cruise terminals, ship repairs, domestic transfer to the islands and environmental and logistics operations.
How is the privatization plan of the major state-owned ports progressing?
Due to the long-term financial crisis in Greece, the major state-owned ports were identified as a potential source of revenue for the Greek State, and, thus, they were considered as assets to be privatized. Accordingly, the Hellenic Republic Asset Development Fund (“HRADF”), which is in charge of the implementation of the privatization programme, acquired 74,138% shares of PPA and 74,268% shares of TPA, by way of the decisions 195/27.10.2011 and 206/25.04.2012 of the Interministerial Restructuring and Privatizations Committee. The shares of the other 10 port authorities, which were 100% Greek State owned (each had a unique share owned by the Greek State), were also transferred to the HRADF in November 2012. The tender process for the sale of 67% of the shares of the PPA and for the sale of 67% of the shares of TPA has been launched with the announcement of the respective Invitations for the Expression of Interest dated 5 March 2014 and 14 April 2014. By way of its decisions 506/2016 and 510/2016, the Greek Council of State rejected petitions for annulment of such Invitations (which had been filed by the Piraeus Lawyer’s Bar Association in the case of PPA and by the Federation of Greek Port Employees and the association under the name “Union of Working Consumers of Greece” in the case of TPA). The Council of State ruled that the relevant Invitations do not involve the acquisition of rights on public use property, but the sale of shares in sociétés anonymes to an investor, that the administrative acts by virtue of which the Greek State transferred its shares to the HRADF were not timely challenged by the petitioners, that the Invitations do not constitute administrative acts that may be challenged before the Council of State and that the petitions were not permissibly filed, as the Council of State would only be competent to rule on such a case brought against an entity other than the Greek State or a public law legal entity only if the petition for annulment is filed by parties which have or had interest in being awarded the particular contact.
On 17 February 2016, the Board of Directors of HRADF unanimously declared Cosco (Hong Kong) Group Limited as the Preferred Investor for the acquisition of the 67% of the shares of Piraeus Port Authority SA; the signing of the share purchase agreement (SPA) is subject to a pre-contractual control by the Court of Auditors and the completion of the transaction is subject to the competent authorities’ approvals and the satisfaction of certain further conditions provided for in the SPA.
Is there an overall state policy for the development of ports in Greece?
The Ministry of Shipping and Island Policy is responsible for the structure of the National Port Policy, which shall be revisited every 5 years. By virtue of article 107 of Law 4389/2016, as in force, the General Secretariat of Ports, Port Policy and Maritime Investments of the Ministry of Shipping and Island Policy is in charge for the development and implementation of an integrated policy and strategy for the organization, development and exploitation of the country’s ports. In particular, the current National Port Policy is in force from 2013 to 2018 and among its objectives are the business development of the ports as well as their specialization based on business criteria, distinguishing port administration from port operation, attracting private investments and granting business rights (by way of concession agreements) to reputable business groups.
What is the main regulatory framework in relation to Greek Ports?
By virtue of article 2 of Law 4150/2013 (Government Gazette A’ 102/29.4.2013), as in force, the Minister of Shipping and Island Policy has authority to supervise all aspects of the management, development and operation of the corporatized Port Authorities. Such competences are complemented by those envisaged in the Code of Public Maritime Law (Legislative Decree 187/1973), as in force, and elsewhere in applicable legislation. Moreover, by virtue of article 108 of Law 4389/2016, as in force, a new regulator with the authority to regulate certain aspects of the Greek port system, namely the Ports Regulatory Authority (the “PRA”), has been established. The PRA is an Independent Administrative Authority, which is in general aiming to supervise and ensure the legality of the relations between public and private sector entities of the national port system, emphasizing in particular to the compliance of the contractual order and the implementation of the legislation of free competition, and without prejudice to the competences of the General Secretariat of Ports, Port Policy and Maritime Investments. The PRA has been assigned with the following regulatory powers and competences: 1) monitoring the implementation of the terms and provisions of the concession agreements in ports, especially with regard to compliance with competition rules, financial goals and the agreed levels of service; 2) monitoring the compliance of the ports’obligations with the national and European legislation, regarding public procurement, concession agreements and competition rules; 3) the obligation to provide public services to the port sector in accordance with the concession agreements and the competition rules; 4) mediating and resolving disputes between the port users and the port managing bodies, handling complaints and taking binding decisions regarding such complaints in due time in any issue of its competence; 5) supporting the competent authorities which compile specifications for public contracts (concessions) and the relevant renewals which are proposed by the port managing bodies, monitoring the implementation of the terms of the public contracts, by ensuring in particular compliance with the agreed level of service, by identifying efficiency levels, levels of investments and jobs’ creation and the compliance with the financial goals; 6) cooperating with the Competition Commission to ensure the accurate implementation of the antitrust law in the field, the prevention of abuse of dominant position, concerted practices, overpricing and other practices that distort competition; 7) framing and proposing necessary legislative provisions concerning any subject of its competence to the Minister of Shipping and Island Policy; 8) drafting and submitting reports concerning any subject of its competence to the jointly competent Ministry or Independent Authority; 9) exchanging information and cooperating with the relevant bodies of other countries-members of the European Union, as regards its responsibilities; 10) delivering its opinion on the methodology and on the determination of the port services’ duties and on the port infrastructure duties, and also on other ports issues following a relevant query of the Ministry of Shipping and Island Policy; 11) exercising in the name and on behalf of the Greek Government its contractual rights which result from concession agreements (such as terminating or dissolving in any way such concession contract, determining and invoking the fulfilment of a resolutive condition or the non-occurrence of a suspensive condition, exercising intervention rights on the under concession assets and/or rights of succession in the concession agreement, referring to any judicial body of dispute resolution, such as courts or arbitral tribunals, and filing judicial petitions and remedies. All the above under 11 can be exercised by the PRA after the prior consent of the Minister of Shipping and Island Policy or the Minister of Finance, unless such actions are requested by both Ministers, in which case the PRA must act accordingly. Any amendment of the concession agreement, however, shall be subject to the provisions that regulate its conclusion.
Which harbor works are subject to permits by the relevant authorities?
Special permits must be granted by the competent authorities for the development of port infrastructure and superstructure, which consists of 1) main harbor works, namely works that take place within the sea and land area and exclusively for the provision of port services, such as extension/improvement/protection works, silting, machine installation and any superstructure that directly serves port functions and 2) ancillary harbor works for the provision of services to the port users, that are indirectly connected to port functions, such as parking areas, recreation and restaurant areas, hotels, passenger stations, passenger transfer facilities, offices and shops.
What are the necessary requirements for the granting of a permit and the commencement of the relative works?
For the commencement of port development works, the following are required: 1) decision by the Board of Directors of the port operator; 2) compatibility check of the technical studies with the approved Master Plan of ESAL (Committee of Port Planning and Development). The process for the granting of the permit is not hindered by the non-completion of the Development Program and the Master Plan of the port within the required by law period of 12 months. In any case, works executed within this period shall be included in the Development Program and Master Plan; 3) approval of environmental conditions pursuant to the provisions of Law 4014/2011 as in effect; 4) decision of the Minister of Shipping and Island Policy, which also constitutes the relevant permit for the execution of the works. This decision shall be issued within fifteen (15) working days from the submission of the application by the port operator. The aforementioned documentation under (1) and (3) should also be submitted with the application and 5) notification of the permit under (4) to the competent Port Authority is also necessary for the commencement of works.
Are further approvals or permits required for repairs or maintenance works? What are the relevant requirements for the issuance thereof?
Repairs – interventions of local nature and maintenance works take place after a decision has been issued by the Board of Directors of the competent port operator. However, a report by the Directorate of Projects is also necessary prior to the aforementioned decision, that shall be notified to the Directorate of Port Infrastructure, which is part of the General Secretariat of Ports and Port Policy of the Ministry of Shipping and Island Policy, as long as these requirements are met: 1) the works serve the purpose of maintenance of the existing equipment or the repair of damages that endanger the employees’ and passengers’ safety and are caused by everyday use during the provision of the main services of the port or the port facility (loading/unloading and circulation of heavy vehicles, passenger embarkation/ disembarkation, usual weather conditions etc.) or from urgent situations (storms, ship impact etc.), such as especially undermining (caving), any kind of damage in platforms and quays, subsidence of superstructures, equipment that needs to be substituted, local failures of strengthening-protecting external harbor works; 2) the works do not modify in any way the geometrical features of the ports or ports facilities; 3) the tendering expense budget does not exceed the amount of 200,000 Euros (non-inclusive of VAT) and 4) the works are undoubtedly linked to the proper and safe function of the port or port facility. The above decision of the Board of Directors shall also be notified to the competent Port Authority before the commencement of the works. In case the tendering expense budget exceeds the amount of 200,000 Euros (non-inclusive of VAT), the aforementioned process under paragraph 1 shall be followed.
In case of a concession agreement, is the concessionaire eligible to apply for the above permits?
As regards works carried out under a concession agreement, the application for the issuance of a permit for port development may be also filed by the concessionaire before the Ministry of Shipping and Island Policy, substituting the port operator, as long as this is explicitly stated in the concession agreement.
Does the Greek legislation require any other permits apart from what has been listed above?
It should be noted that, apart from the above process, further building permits may be required pursuant to the provisions of the Greek legislation.
What is the general legal framework regulating the prevention of ports’ environmental pollution?
In general, pollution prevention, environmental noise, contingency plans for dealing with pollution incidents by oil as well as the management of waste oils, hazardous waste and other dangerous substances are regulated by several international, EU and national laws and regulations. In particular, Directive 2000/59/EC as amended by Directives 2002/84/EC and 2007/71/EC, and implemented in Greece by virtue of Ministerial Decision no. 3418/07/2002 as amended by Presidential Decree 3/2005 and Ministerial Decision no. 8111.1/41/09 contain provisions on port reception facilities for ship-generated waste and cargo residues. These provisions are applicable to: a) all ships, including fishing vessels and recreational crafts, irrespective of their flag, calling at, or operating within, a Greek port, with the exception of any warship, naval auxiliary or other ship owned or operated by the Greek State and used, for the time being, only on government non-commercial service; b) to all Greek ports normally visited by ships falling under the scope of point (a) above. As regards other Greek ports where the above ships occasionally arrive, the provisions of their respective special ports’ regulations apply, except if their port operators decide on the application of these law provisions. Furthermore, ships which are excluded from the scope of point (a) deliver their ship-generated waste and cargo residues in a manner consistent, in so far as is reasonable and practicable, with these law provisions. In broad terms, the legal provisions under the above referred legislation refer in detail to different aspects of waste disposal; e.g. the port operators’ obligation to provide suitable waste disposal services and obtain permits, the submission by the port operators to the competent authorities of plans for the reception and disposal of waste, as well as ships’ obligation upon arrival to inform the port and pay the relevant tariffs.
What is the general legal framework regulating port safety?
Concerning ports’ safety issues, Regulation (EC) 2004/725 as well as Directive 2005/65/EC have been transposed in Greek legislation by Law 3622/2007. Pursuant to such Law, the Ministry of Shipping and Island Policy coordinates, supervises, and ensures the compliance with the procedures and the implementation of security measures, while the Port Security Authority as appointed by the Minister of Shipping and Island Policy drafts and implements port security plans. In addition, the Ministry proposes the appointment of a Port Security Officer and his deputy. Furthermore, port operators are obliged to designate Security Officers for the port facility, unless otherwise provided in the written agreements between the port facility owner and the operator or between the operator and a third party (sub-lessee). The operator is responsible for security assessments of the port facility and the drafting and implementation of security plans pursuant to the assessment results. The port operator shall also generally abide to the above Regulation and the international ISPS Code and maintain resources for the implementation of security measures. Port operators may also assign to private security services’ companies that function under a lawful permit, security controls according to the approved security control plans including person controls, baggage and cargo checks, entrance checks and safety monitoring of the port’s facilities. For the above activities, the competent port authority shall issue a permit of police nature, while the conditions shall be regulated by the Minister. Further security measures may be taken by the Port Security Officer, in accordance with the Ministry’s general orders and the port security plan.
What are the recent developments as regards marinas?
Legislation recently enacted on marinas, as well as on marine tourism in general, aims to attract more recreational ships, under Greek and foreign flag, in the Greek seas, thus rendering marinas both a more interesting investment option and a tool for the growth of Greek tourism in general. The licensing and urban/rural planning procedure for certain categories of marinas (due to their large size or due to proximity to areas of special environmental or cultural interest) has been simplified, whereas certain geographical barriers for the operation of ports are lifted. In addition, it is provided that retail shops in marinas may operate on Sundays and bank holidays. Particularly important for the enhancement of investment incentives is the abolishment of the provisions, according to which marinas could be established at the initiative of the General Secretariat of Tourism or of any natural or legal person so long as the latter were owners or had enjoyment of the real estate in front of which marinas would be created. In addition, provisions setting preferential treatment for state-owned marinas (e.g. exemption from the obligation to submit operational and sustainability plans) have been abolished. Thus, any party interested may undertake the initiative to establish a marina.
