Two years ago the Romanian anti-fraud and tax authorities took the Romanian business environment by surprise, by initiating a thematic tax audit campaign aimed at auditing the tax treatment of purchased gift vouchers, in terms of income tax and social security charges. A very sought after extra-salary employee benefit, companies bought and offered gift vouchers amounting to over RON 1 billion (approx. EUR 200 million) in 2018 alone.

Following the adoption of regulations allowing profit tax consolidation in late 2020, the Romanian tax authorities issued Order 1191/2021 approving the instructions for implementing and managing Profit Tax Groups (“PTGs”) on 6 August 2021.

Not all the impacts of the COVID-19 crisis on Romanian society are negative. The crisis also led to the much-overdue regulation of telemedicine in Romania.

[Updated on 8 July 2021] Further to the entry into force of EU Medical Devices Regulation 2017/745 on May 26 2021, the Romanian Government issued an Emergency Ordinance setting forth the institutional framework for ensuring the MDR’s direct application (“GEO no. 46/2021”) and announced that the Ministry of Health will issue the secondary legislation in the following months.

An interview with Gianluca Carlesso of The Carlesso Law Firm, about his path from Italy to Romania.

Intra-group loans and guarantees are frequently encountered in the activity of group companies, especially when centralized capital and liquidity management systems are in place. Intra-group loans are often used as tools to maximize liquidity at the group level while reducing the cost of funds, while the guarantees provide group companies with better access to external financing or high-value commercial contracts.

Needless to say, the COVID-19 pandemic has been extremely challenging for organizations worldwide, both experienced and start-ups. The new reality has also compelled a vast majority of entrepreneurs in Romania to quickly adapt to a new economic context – significantly impacting the data protection domain.

A shareholders’ agreement, also referred to as a stockholders’ agreement, is, as indicated in its title, an agreement concluded by and between the shareholders and, often, the company itself.

The modern mentality concerning the relationship between employers and employees has led to the creation of mechanisms aimed at increasing the loyalty of the latter. One such mechanism that has become very popular in recent years is the Stock Option Plan.

We are now one year on from the first lockdown, and although many worried in the early days of the pandemic that Romania’s court system might not be able to cope with the large number of insolvencies that were expected, in fact the highly-anticipated wave of restructurings is yet to happen, as the debt moratorium which was enacted and then extended and the availability of the state aid package as well as the generally supportive approach of the lenders have helped companies manage their debt service and need for liquidity.  While there is no shortage of funding, the uncertainty of the lockdown period and its impact on future developments have resulted in more amend-and-increase or amend-and-extend transactions, with borrowers adding to their existing lender groups rather than seeking a full refinancing. 

From an economic and social point of view, throughout Europe, the COVID-19 pandemic period could be summarized in two words: digitalization and flexibility. These words were also key to employment matters, with a tendency for both employers and employees to be more open to establishing cross-border employment relationships, switching to remote work performed from a different EU Member States or, in case of expatriates, returning to their country of origin while continuing to work remotely for the same employer.

One year into the COVID-19 pandemic, the “new normal” is as fluid and unexpected as ever. The aftermath of the health crisis and its economic impact has not matched the initial expectations for dispute resolution: the Romanian market has not been flooded with insolvencies and commercial disputes.

Some time ago, a merger control case I was working on, involving the gambling sector (among other things), raised an interesting problem regarding the role of competition law.

Navigating the maze of zoning, planning, and land-use-approval processes can result in significant delays and escalating costs, which may spell the difference between a development project’s success and failure. With the economic growth of Romania over the last few years having generated investor interest in developing new real estate projects, particularly in well-established urban areas like the country’s capital, the authorities have repeatedly expanded and amended the country’s urban planning laws.

Economic, policy, and legislative factors have revived investors’ interest in Romania’s renewables sector over the last year. As the second-largest market in Central and Eastern Europe, Romania managed to attract about EUR 8 billion in renewables investments in the first wave from 2008-2016 – mainly in solar (over 1.5 GW) and wind (over 3 GW) – benefitting from the green certificate support scheme, although Romania reached its 2020 target for green energy and investments slowed down significantly over the last five years.

On April 8, 2021, CEE Legal Matters sat with senior partners from four of Romania’s leading law firms for a Round Table conversation.

The COVID-19 pandemic has brought a lot of practical and legislative changes. Still, even if the virus complicated the overall environment (to which other factors contributed, such as elections followed by a change of government), Romania remains a place with significant business opportunities.

In “The Corner Office” we ask Managing Partners at law firms across Central and Eastern Europe about their backgrounds, strategies, and responsibilities. The question this time: “What did you most want to be when you were little?”