Draft law on the sale and purchase of Romanian agricultural land outside the built up area

The project on transactions with agricultural land outside the built up area, in Romania, was modified several times on September 3, September 17 and September 23, 2013, making visible a number of issues of immediate importance proposed to be analyzed from various perspectives. Persons in question nominated by this project who actually have the right for acquisition are Romanian citizens, EU citizens, all those who are considered stateless persons but residents in Romania or EU. Last version of this draft law also introduces a category referring to individuals who are considered stateless persons on the territory of EEA (European Economic Area). After the last update of the project the individual who can purchase land in Romania, located outside the built up areas, must meet a number of conditions. One of the most important aspects, concerning the acquisition of land in Romania, is related to the importance of proving general knowledge regarding the agricultural field and also evidence of the fact that he/she worked in this area for the past five years, at least.

Authority for Land Market Management and Regulation

The authority which shall be responsible for checking individuals is the Authority for Land Market Management and Regulation. This institution is responsible for all measures required for law enforcement whose foundation is laid through the drafts nominated above. This authority will also be the one which will handle the database that will contain information regarding agricultural lands. All buying and selling details will be published through this institution’s help also intended for supervising the exercise of preemption right.

Special circumstances are also indicated limiting the transactions with agricultural land outside the built-up areas. This includes land located within 10 kilometers from the border that may be used only with the consent of the Ministry of National Defense. Agricultural lands which can be defined as areas of archaeological potential are accessible only through approval of the Ministry of Culture. Agricultural lands with irrigation infrastructure must be preserved, at least, in the same state as purchased. The National Agency for Land Improvement (ANIF) keeps reports on the status of these lands at the time of their purchase. There are also some ​​remarks on the quality of the tenant who can purchase such lands. The new Civil Code through the Article No. 1838 indicates legal procedures to be followed by tenant to register with local authorities. There are some important stipulations introduced concerning the maximum area to be purchased which is of 100 hectares. Until the 2^nd of October 2013 the final form of this project should be subject to public debate. Our team of attorneys is available to provide further information on this topic. We are also able to offer legal assistance necessary to clarify any misunderstanding raised by this draft law regarding the acquisition of land in Romania.

How to Change the Administrator in a Romanian LLC

The decision to change the administrator of a limited liability company supposes the adjustment of the articles of association; such procedure requires the approval of the general meeting of the shareholders. The document that illustrates these procedures should include a range of information to prove decision of the sole shareholder or the general assembly’s verdict and also a number of aspects regarding the new administrator. Such documents must include details concerning the type of summon to the general meeting of shareholders, the decision proving the intent to change the administrator and the newly appointed one, as well  the signatures of those responsible. This is followed by the submission of a statuary statement made ​​by the new administrators certifying that they accept their new position and prove the fulfillment of all legal requirements. In an early stage, it is signed a statuary statement  but, there are strict conditions imposed in order to occupy this position. A sample signature must be provided by the newly appointed administrator. Articles of association must be updated with the name of the new administrator.

Documents required to change the administrator of a Romanian LLC

The file to be submitted to the Trade Register in order to announce the change of the administrator of limited liability company in Romania must contain the following documents: an application form which can be requested online, updated articles of incorporation outlining the new administrator, decision of the general meeting or the verdict of the sole shareholder, if applicable, the statuary statements that we have mentioned above, signed by the new administrators, the sample signature, identity cards of administrators. There are certain cases when it is necessary to submit a statuary statement, for natural foreign persons, proving that there are no tax debts in question. We refer here only to those who have no tax registration in Romania. When a legal person is appointed administrator of the limited liability company registration papers are required, the original accompanied by a copy. The National Agency for Fiscal Administration will provide an electronic document certifying the lack of tax debts. Along with these documents there should be a mandate for those designated to handle formalities implied by these procedures. A proof of payment should be also attached.

We emphasize the fact that the limited liability company may have one or more administrators, legal or natural persons. The decisions taken by the General Assembly or by the sole shareholder represents a fundamental basis for procedures initiated by the administrator. The reasons for changing one or more administrators may vary a lot and various circumstances may frequently introduce unexpected legal issues. For this reason, our lawyers recommend an expert’s opinion which can provide additional information about your case highlighting peculiarities and optimal approaches.

Protocol on avoidance of double taxation and prevention of fiscal evasion between Romania and Austria

The Law no. 245/2013 introduced several changes intended to sustain the various tax measures stipulated through the provisions of the Protocol amending the Double Taxation Prevention Treaty between Romania and Austria. Above mentioned document acts as an instrument optimized to avoid double taxation but also as a safety tool for prevention of tax evasion in Romania and also Austria. These conventions refer to taxes on income and on capital imposed by each country. In this category there are included all taxes on total income but also on elements of income. The amendments made ​​by Law. 245/2013 are visible in the Article No. 27 concerning the exchange of information related to taxes. Each contracting State shall supply the necessary data. The data will be subject to exchange if being relevant to the content of the Convention and only if they are related to taxes taken into account. The data obtained on this basis shall be considered as secret and any detail provided must be previously accepted by the designated authorities responsible with such duties in the state which was requested to offer the information. These data can be provided and used to conduct public court proceedings. If both states accept the use of information for purposes other than those mentioned, always on a sustained legal basis, the data can be taken into account provided that the competent authority in the State to provide the necessary details authorizes these procedures.

The provisions introduced shall not violate or infringe, in any way, the legislative integrity of both Contracting States. The newly introduced measures are not meant to influence in any way the normal course of the administration in one or both contracting states. Professional or trade secrets shall not be disclosed opposing to public policy principles. Each of the two Contracting States must provide the requested data even if details are not of national interest for the state which was required to disclose these aspects. Information held by financial institutions or similar authorities can be made available for the purposes specified by this convention. The two countries will support a diplomatic cooperation in order to assist on a reciprocal basis in order to supervise the implementation of all the provisions introduced through this Protocol. The protocol will be considered as a part of the Convention and shall remain in force as long as the Convention remains valid. Our law office is able to provide any type of information concerning the Romanian Double Taxation Prevention Treaties and all consequences implied.

New Regulations for the Romanian Bilateral Contracts Market for Green Certificates

The Romanian Energy Regulatory Authority (ANRE) adopted a new set of guidelines establishing supplementary adjustments for all participants on the green certificates market: seller, vendors and the operator itself (OPCOM). By adopting the order no. 57/2013 ANRE aims to introduce a solid framework for the functional organization of the green certificates market in Romania. Providing a transparent environment for the bilateral contracts market for green certificates translates into an effective optimization which further encourages the development of the renewable energy sector. They provide an explicit description regarding the organization of public tenders which must be notified through an announcement of OPCOM placed on the online platform. This announcement will contain information concerning the sell or buy offer. The auction session data will be updated automatically keeping the participants incessantly informed about significant aspects related to this process. In the event of dealing with two identical offers which means they share the same best price the public tender has to be resumed within 45 minutes following exclusive procedures. If the second session does not designate a winner the typical steps required for a regular session should be resumed. Any transaction completed through the indicated procedures comes with the obligation to conclude a bilateral contract for the one who is the winner of the session. Any complaint may be submitted within two business days and its solution will be provided within 24 hours of submission.

OPCOM must provide the two involved participants with final data regarding the completed session within 24 hours. Each participant is required to sign and comply with the terms of the contract. For the seller there is mentioned a new obligation specifying that copies of the contracts should be submitted to both OPCOM representatives and ANRE within five days of signing the documents. The data will be subject to verification by OPCOM that must allow a 24-hour recess to perform necessary changes. According to new regulations OPCOM has the liberty to suspend any participant provided that the designated party has not updated individual data contained in the participants register or in the green certificates register. Our law firm engages in providing any additional details about the changes occurred in this domain always pointing out the dynamic character of all legal aspects regarding the Renewable Energy Market in Romania. Being a hyperactive industrial segment the renewable energy field is subject to inevitable changes altering the evolution of the green certificates market. Our group of lawyers is committed to indicating all adjustments describing the development of this specific domain making available the necessary information able to clarify inherent ambiguities.

New Provisions for Romanian Short-stay Visa

The newly published government decision no. 530/2013 introduces a set of provisions related to procedures required to obtain a short-stay visa for specific business purposes. Facilities are granted to certain categories of foreigners who are considering carrying out activities in Romania. The foreign citizens who are included in this particular group targeted by the listed-above provisions will have the right of entry and residence for the territory of Romania, through the mechanism of short-stay visas with multiple entries. Statements taken into account for this government decision indicate that beneficiaries of this visa will be foreigners who are considering carrying out activities "on offshore installations located in waters of exclusive economic zone of the Romanian state ". This visa is to be granted for a period of less than five years taking into account stays up to 90 days (on a course of 180 days). Documents required for issuing this type of short-stay visa include: a travel ticket indicating the final destination; drivers are required to have the green card, driver's license and car ownership papers. Health insurance is required as well. There must be also a document that is able to illustrate the purpose of the stay indicating activities that will be carried out. There are as well necessary financial documents sustaining the guarantees for budgeting accommodation and all other involved expenditures.

The Romanian or foreign legal entity which is responsible for hiring the foreign citizen must provide all needed documentation proving the main purpose of this stay and it is also important to guarantee that, in the event of exceeding the visa validity terms, it must agree to assume financial responsibility for contingent expenses. These newly introduced provisions are to be understood in the context provided by all other previously established regulations regarding the visa regime in Romania. Our lawyers are able to provide the necessary assistance to clarify some details about formalities required for obtaining this type of short-stay visa. We are also interested in proposing a number of alternatives that might prove favorable for our client's interests.

Industrial Parks in Romania

Industrial parks represent a special category of large-scale investments in Romania and their relatively recent emergence on the Romanian industrial field imposed a series of completely new policies which had to be absorbed by a roughly functional market economy. Probably the most attractive aspects related to this topic refer to consistent incentives portfolios which were gradually introduced on either national level or on European one. It became clearly beneficial for investors to financially target this field as it opened a number of highly lucrative opportunities. In the same time, a ubiquitous condition which plays an important part in balancing gains for both sides regards the guarantee which is to be offered by each project initiator to increase the number of jobs. Law progressively identified key issues in establishing an optimal system frequently changing and perfecting various details. Following this pattern, authorities recently added new regulations related to precise requirements imposed for establishing industrial parks, the authorization process for granting the title of industrial park, personal liability of administrators and a list of legal incentives that both administrators and residents of the park will benefit from.

Industrial parks incentives in Romania

According to Law No. 186/2013 regarding the establishment and operation of industrial parks, the latest changes introduced a number of features indicating a series of facilities provided for both administrators and residents of industrial parks. These incentives may be granted by local authorities as well but they are generally delivered as tax exemptions allowed by the state. In this particular case we are talking about exemptions for property tax on buildings, on land and suspension of financial duties occurring when changing land use or when having to convert the land out of agricultural use.

Functioning of industrial parks in Romania

Administrators of these parks are supported in terms of maintaining a set of balanced management policies clearly mentioning the importance of following regulations established by them. Residents of these parks are bound to take into account details concerning organizational strategies and also the selection of residents’ process. The administrator is the one who will receive the title defining the industrial park as issued by the Ministry of Regional Development and Public Administration. For old industrial platforms which went through the process of privatization a different system will apply based on a government decision or specific legislative measures. The order issued by the Ministry of Regional Development and Public Administration clearly establishes the validity of the title for the park.

Through these last changes, the authorities evidently emphasized the principles which are fundamental when establishing industrial parks in Romania. The importance of introducing new job opportunities is crucial. The administrator does not have permission to encourage or initiate any activity that fails to comply with rights and liberties of residents. Park residents should be treated equally and using the same principles-based standards. The founders of the project must file the application in order to be granted the park title. References concerning the nature of the land on which the park will be built impose a number of limitations. Thus the minimum land area must be of at least five hectares and it is also important to have a unitary character (except for those which are crossed by access roads). There must be a solid guarantee concerning the access to European routes, national primary roads or ring roads. The land in question can be administrated by residents, the founders or the administrator himself. As we mentioned before, this field is constantly developing requiring various interventions at legal level. Our law office provides legal advice in order to identify best strategies to be followed in establishing an industrial park. Our lawyers are committed to propose a number of approaches that exercise effective legal regulations constantly offering, to all clients, details concerning the evolution of the project and possible alternatives that might improve perspectives.

New Amendments for Non-resident Taxpayers in Romania

The National Agency for Fiscal Administration (ANAF) enacted a set of new regulations related to non-resident taxpayers’ regime engaging in commercial activities through one or more permanent establishments on the territory of Romania. These provisions firstly clarify procedures concerning the registration process for non-resident taxpayers carrying out activities in Romania. The persons in questions are responsible for filling out the Form 013 known as ”Fiscal Registration Statement/ Mentions Statement for non-resident taxpayers carrying out activities in Romania through one or more permanent establishments”.  This document should be completed in duplicate since one version is to be kept by the non-resident taxpayer and the other one will be submitted to the designated bureau. Depending on the activities they undertake, non-resident taxpayers can request and register for VAT purposes. If the entity has already completed the direct VAT registration the code previously provided will be used, taking into account the first date of registration issued for these purposes. For those situations when there is a further statement which introduces another permanent establishment, the taxpayer is required to provide the tax authority that administers the area where the new office is located, with the form 013 which will be corroborated with another form 050 “Application for the registration of the tax residency of the taxpayer “.

Declaring the permanent establishments by non-resident taxpayers

There are also mentioned all stages describing the process of declaring the permanent establishments founded by non-resident entities interested to carry out business activities on the Romanian territory. These secondary offices must be registered within 30 days with the nominated authority which, in this case, is the National Agency for Fiscal Administration. The form "Declaration to register secondary offices" initiates the proceedings for declaring the secondary offices and the Form 060 “Tax registration statement/Registration of changes for the secondary establishments” will provide further needed information in order to guarantee compliance with regulations concerning the corporate income tax in Romania.

New aspects for non-resident taxpayers in Romania

The purpose of these regulations which amends Law No. 571/2003 is clearly emphasizing the compulsion of nominating of one single establishment, responsible for tax management, for non-resident taxpayers carrying out activities through several offices. For situations where a permanent establishment is the unique institutions designated as secondary office on the Romanian territory, according to Fiscal Code, Title II, it represents the only authority responsible with tax management. In practice, the novelties introduced through these amendments regard the occurrence of the standard form 013 in Romania which is called ”Fiscal Registration Statement/ Mentions Statement for non-resident taxpayers carrying out activities in Romania through one or more permanent establishments” (published through Order No.877/2013) and imposing clearly, for all companies, to appoint a permanent unique establishment responsible for handling tax duties. The tax environment is continuously changing proposing and imposing new features which call for an expert’s opinion that can clarify the ineluctable incongruence. Our lawyers are ready to provide professional help in order to avoid any further inconveniences that might expose your business in an undesirable manner.