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"Last year has been easily the worst year in the market, as we waited for the IMF and EU funding." As can be gleaned from the above quote, Greece this year has found itself sinking further into a financial quagmire....

"Last year has been easily the worst year in the market, as we waited for the IMF and EU funding."

As can be gleaned from the above quote, Greece this year has found itself sinking further into a financial quagmire. With debt burdens continually swelling, a government divided by internal squabbling and opposition to essential austerity measures becoming ever more violent, the market is one truly characterised by tumult.

"To be honest, the market is slow and really only the firms who do work with international clients will be able to have anything like a successful year," says one partner, while another had even stronger concerns: "During the first few months we were worried about the firm, wondering whether it would actually survive."

One of the reasons for this is the trend that has emerged for companies to try even harder to keep any legal work in-house now. With the constriction of the economy legal budgets have seriously atrophied, leading to a shortfall of work.

"One of the big changes in the Greek legal market is a change in relationships. Now companies are looking for lawyers to be seconded to them on retainer, and trying to keep as much work as possible in-house," explains one partner.

"Companies are cost-cutting and are looking for more focused advice. There have been a lot of secondments of lawyers which works for firms as they don't have to pay social security and the like," comments another.

Another thing that has impacted firms has been the helter-skelter nature of taxation, with the rules changing all the time, and not always in their favour. "The VAT law on legal fees has been a massive change. Fees are now taxable immediately, which means sometimes you are paying tax on fees you haven't received yet!" comments an incredulous partner.

The capital markets are, overall, in a "stagnant" state. As one partner comments: "Capital markets work is unstable and there have been no listings on ATHEX (the Greek stock exchange). No IPOs or tender offers either."

The inclination toward the debt market continues however: "There is a trend in the issuance of convertible bonds," says a partner, while another gives a more optimistic spin on the markets as a whole: "There has been a severe hit in the stock price but this can facilitate the kind of deal where private investors end up taking over local listed companies, perhaps converting debt to equity.

Finance too is extremely hard to come by, with one partner pragmatically remarking: "In terms of the timing, it's not exactly the time to consider banks lending freely." Another agrees, "Lending has been very much restricted."

The M&A market is "showing signs of life" according to one practitioner, but is really awaiting the wholesale privatisation scheme that has been put in place by the government to really get up to speed. "Privatisation, as and when it comes to implementation, will bring a lot of M&A work, as well as capital markets opportunities," says a partner.

Through this scheme the state will look to raise funds by selling off a number of outstanding stakes in a range of different businesses. Opinions on this vary, both among the public and partners too.

"As regards the privatisation, I would say the real estate is a touchy issue. The bulk of the funds will come from selling stakes, as in shares, in important companies such as telecoms, the 'Greek BBC' and water suppliers," says a partner.

"I have heard the number $50 billion tossed around but that's an almost impossible figure I think. The thing is there are still politicians and others that oppose these sales, as well as unions in state owned corporations. These are strong. PPC, which provides electricity to 95% of homes in Greece, could go on strike, and there'd be a blackout."

There are also hopes that this privatisation could bring in investors, with FDI (foreign direct investment) seriously suffering. The downgrading of Greece's investment status would appear to be another big problem, though one lawyer has another, slightly wry view of this: "The downgrading doesn't make too much of a difference. It only really matters when you have people who actually want to invest in you."

There are some rays of light however with project finance, the first area on the road to recovery. "It's been good yes, there has been no drop in the influx of work," says a lawyer. Renewable energy has been a massive driver of this, including solar and wind energy in particular.

Lastly though, it is a good sign that those in the market are very much making lemonade out of the avalanche of lemons they have received this year.

"Overall, I think that these austerity measures will be extremely good in the long-term. The economy will be more structured as they were quite non-regulated before," says one lawyer, while another adds: "Long-term, it really depends how well we use this time. The crisis is a challenge but we are optimistic. Greek people are optimists, I don't know if it's the climate or culture but we are positive!"