Latest updates

Impact of environmental authorisation in transfer of assets or business
  • Corporate Finance/M&A
  • Romania
  • November 29 2017

Regulatory approval plays an important role in the transfer of assets or lines of business. In general, where permits are issued in consideration of assets being sold, the transfer will entail a new authorisation procedure to be undertaken by investors. This is also the case for environmental authorisation; however, as local authorities do not consistently deal with the applicability of the various regulations in this regard, mitigating potential hurdles will generally require coordination with the respective authorities involved.

Proposal on the sale of local food products: competition concerns
  • Competition & Antitrust
  • Romania
  • November 05 2015

Parliament is debating a proposed amendment to the law on the sale of food products that would oblige all authorised retailers of food products to ensure that 51% of meat, fruit and vegetables are acquired from the short food supply chain. The proposal raises a number of legal and practical issues, and risks infringing one of the four basic freedoms of the EU common market: the free movement of goods.

Considering the challenges of non-performing loan deals
  • Banking
  • Romania
  • October 23 2015

The restructuring of non-performing loans has been slower in Romania than in other EU member states. However, further to the implementation of new regulations, the National Bank of Romania has now begun to apply pressure on local banks to dispose of their problematic assets and clean up their balance sheets. Consequently, domestic and international non-performing loan deals are becoming more common on the Romanian market.

Practical considerations during reorganisation procedures
  • Corporate Finance/M&A
  • Romania
  • September 02 2015

As momentum builds in the Romanian business environment, reorganisations by way of spin-off or merger have become increasingly attractive options for companies. This growing interest highlights several ambiguities in the relevant legislation. However, certain solutions are typically implemented in practice in order to alleviate risks associated with this lack of legislative clarity.

Competition Law amendments under new government emergency ordinance
  • Competition & Antitrust
  • Romania
  • July 23 2015

Recently issued Government Emergency Ordinance 31/2015 introduces a number of significant changes to the Competition Law, including with regard to merger notification obligations, the organisation and structure of the Competition Council and settlement procedures. The council had proposed further amendments, but these proved highly controversial and were ultimately shelved.

Effects of annulment of shareholders' resolution on subsequent acts
  • Company & Commercial
  • Romania
  • June 08 2015

In assessing title over shares in Romanian companies, one of the most common issues is the effect that the annulment of a shareholders' resolution may have on subsequent acts concluded on its basis. While court practice has been inconsistent over the years, a recent High Court of Cassation and Justice decision provides additional guidance for interpreting and applying the penalty of nullity in matters relating to companies.

Fiducia – a flawed attempt to replicate trust structures
  • Banking
  • Romania
  • March 20 2015

The novelties brought by the new Civil Code include the fiducia, a concept similar to the common law trust. Although the fiducia is purported to facilitate implementation of trust-based legal structures, its use in practice remains limited due to, among other things, a lack of flexibility in its establishment and operation.

Considering legal certainty in competition cases
  • Competition & Antitrust
  • Romania
  • March 12 2015

According to the Romanian Constitution, the High Court of Cassation and Justice must ensure the unitary interpretation and application of the law by the other courts. However, as a recent case regarding an antitrust agreement shows, the high court is often one of the worst offenders regarding this principle.

Corporate implications of discontinuation of RASDAQ market
  • Capital Markets
  • Romania
  • December 02 2014

Parliament recently adopted Law 151/2014, which clarifies the legal regime governing shares listed on the RASDAQ market or the unlisted securities market. In addition to the changes brought to the Romanian capital markets landscape, Law 151/2014 sets out a series of provisions with potential effects on the shareholding and corporate order of more than 900 Romanian companies.

Recent amendments to Competition Law and Unfair Competition Law
  • Competition & Antitrust
  • Romania
  • October 23 2014

The recently published Government Ordinance 12/2014 makes significant amendments to the Unfair Competition Law and the Competition Law. The amendments provide welcome clarity and streamline certain procedures. However, they also raise substantial questions, including with regard to the Competition Council's discretion to pursue cases and companies' right to defence.

Arbitration court returns to appointment of arbitrators by the parties
  • Arbitration & ADR
  • Romania
  • July 31 2014

New rules were recently adopted which govern the arbitration procedure of the Romanian Court of International Commercial Arbitration. The regulations are intended to increase parties' confidence in arbitration and encourage them to choose this method of dispute resolution instead of litigation in the state courts. The most important change brought by the new rules is that the parties may now designate their own arbitrators.

Revised criminal codes bring new requirements for Competition Council raids
  • Competition & Antitrust
  • Romania
  • April 17 2014

The recent entry into force of the new Criminal Code and Criminal Procedure Code has brought a number of changes to the Competition Law, one of the most significant of which pertains to Competition Council dawn raids. Although the amendments should be seen as a step in the right direction, especially in terms of compliance with EU human rights law, further steps still need to be taken.

Grounds for refusal to recognise foreign arbitral awards
  • Arbitration & ADR
  • Romania
  • March 27 2014

Recognition and enforcement of foreign arbitral awards in Romania is governed by both national law and the 1958 New York Convention. The Civil Procedure Code sets forth the acceptable grounds for refusal to recognise foreign arbitral awards, which are largely similar to those of the New York Convention. However, the convention prevails over national law in most cases.

Tax treatment of stock option plans: navigating the grey areas
  • Corporate Tax
  • Romania
  • October 25 2013

Implementing stock option plans in Romania involves a degree of uncertainty due to the lack of clear and detailed legal provisions on their applicable tax treatment. Considering recent practice, the tax treatment applicable to stock option plans and employee reward schemes in general should be clarified in order to give companies a better perspective on their tax obligations and those of their employees.

Courts grant recognition and enforcement of unreasoned foreign arbitral award
  • Arbitration & ADR
  • Romania
  • September 19 2013

Recognition and enforcement of foreign arbitral awards in Romania is governed by both national law and the New York Convention. One of the primary issues raised in a recent case was the question of which procedural rules should apply to the recognition of a foreign award. However, the core issue was whether the award violated Romanian public policy for private international law, since it lacked the reasoning for reaching the decision.

In focus: bankruptcy procedure for credit institutions
  • Insolvency & Restructuring
  • Romania
  • August 23 2013

The bankruptcy procedure for credit institutions in Romania is subject to a special government ordinance that provides derogative provisions from the Insolvency Law in order to protect the banking system. Ordinary provisions of the Insolvency Law are applicable to credit institutions only where the special legislation regarding bankruptcy of credit institutions contains no relevant provisions.

Factoring versus forfaiting: operations subject to value added tax?
  • Corporate Tax
  • Romania
  • June 14 2013

The need to maintain existing clients' loyalty while attracting new clients has increasingly led suppliers and providers of goods and services to extend the grace period for payment of the goods or services. This in turn has led supplier companies to identify solutions to improve their cash flow, two of which are factoring and forfaiting operations. However, issues arise as to whether these operations are subject to value added tax.

New Civil Procedure Code improves arbitration procedure
  • Arbitration & ADR
  • Romania
  • June 06 2013

The new Civil Procedure Code makes significant changes to the previous arbitration rules by incorporating recent jurisprudential and doctrinal solutions in order to create a more attractive and flexible alternative dispute resolution procedure. The new code contains several innovations that aim to speed up the arbitral process and facilitate access to this private form of justice.

Council launches new pharmaceuticals sector enquiry
  • Competition & Antitrust
  • Romania
  • April 11 2013

The Romanian Competition Council recently launched its second sector inquiry into the pharmaceuticals industry. The inquiry will highlight certain aspects raised by producers' commercial activities in Romania – specifically, the causes of delays in generics entering or penetrating the market and the extent to which the direct-to-pharmacies model fits into the legal framework.

Considering insolvency clawback risks
  • Insolvency & Restructuring
  • Romania
  • March 28 2013

According to the Insolvency Law, the judicial administrators, liquidators or creditors' committee of a company subject to an insolvency procedure are entitled to claim the cancellation of certain transactions concluded before the opening of the insolvency procedure. The applicable period varies from 120 days to three years before the opening of the insolvency procedure, depending on the type of transaction in question.