WORLD TRADE G/SCM/N/9/ROM
31October 1996
ORGANIZATION(96-4589)
Original: English Committee onSubsidies andCountervailing Measures
NOTIFICATIONS UNDER ARTICLE 29.3OFTHE
AGREEMENT ONSUBSIDIES AND COUNTERVAILING MEASURES
Thefollowing communication, dated 14October 1996, hasbeenreceived fromthePermanent
Mission ofRomania.
_______________
Thepresent notification ispresented under Article 29.3oftheAgreement onSubsidies and
Countervailing Measures. Romania reserves itsright tosupplement thisnotification until
31December 1996. Thisnotification iswithout prejudice tothelegalstatus ofthemeasures notified.
Thenotification includes programmes meant tosupport theprocess ofprivatization, ofstructural
adjustment aswellasofconsolidating thetransition oftheRomanian economy tothemarket economy.
TABLE OFCONTENTS
Page
I. FARMERS 'SUPPORT PROGRAMME .............................2
II. PROGRAMME ONTHE STIMULATION OFINDUSTRIAL RESTRUCTURING ..4
III. EXPORT INCENTIVES PROGRAMME .............................5
IV. PROGRAMME ONTHE STIMULATION OFFOREIGN INVESTMENT IN
ROMANIA ................................................6
LawNo.83/1993 onthesupport granted bytheState tothefarmers ............9
LawNo.75/1996 ontheproduction, quality control, commercialization
anduseofseeds andseeding material ...............................15
LawNo.84/1996 onlandreclaiming ................................16
LawNo.58/1991 ontheprivatization ofcommercial companies ...............17
Government Ordinance No.14/1995 oncertain measures forthestimulation ofthe
achievement ofcomplex installations andoftheproduction withlongmanufacturing
cycle, meant tobeexported ......................................18G/SCM/N/9/ROM
Page2
Page
Government Decision No.880/1990 ontheorganization andfunctioning ofthe
Romanian Foreign Trade Centre ...................................20
LawNo.22/1995 ontheState Budget for1995 .........................22
LawNo.29/1996 ontheState Budget for1996 .........................23
Government Decision No.805/14.11.1994 regarding economic andfinancial
incentives forthesmall andmedium-sized enterprises .....................24
Foreign Investment LawNo.35/3April 1991 ..........................26
LawNo.71/1994 onSupplementary Incentives toLaw ....................34
LawNo.66/1992 concerning thegrant offacilities inorder toattract foreign
capital inthefieldofexploration andexploitation ofoilandgasfields ...........35
I. FARMER 'SSUPPORT PROGRAMME
Trade policy objectives oftheprogramme, including certain sectoral objectives (when these
canbeidentified)
Themainobjective ofthisprogramme istosupport themodernization andstructural adjustment
ofagriculture inthecontext ofitsprivatization, while taking intoconsideration theeffect ofdiminishing
thesizeofthefarms, induced bytheprivatization process.
Bythisprogramme, theState supports thefarmers through allocations andsubsidies ofthe
interest ratesrelated totheproduction andinvestment credits, aswellasthrough production bonuses
andcompensations, fiscal advantages, credit guarantees helping toobtain credits, guarantees for
rewarding purchase prices foragricultural products ofnational importance, technical assistance and
other facilities.
Legislation
LawNo.83/30 onthesupport granted bytheState tothefarmers, published inMonitorul
Oficial -theOfficial Gazette -No.284/7.12.1993;
LawNo.75/1996 ontheproduction, quality control, commercialization anduseofseeds and
seeding material aswellasontheregistration ofagricultural plant varieties, published in
Monitorul Oficial -Official Gazette ofRomania -No.150/1996, and
LawNo.84/1996 onlandreclaiming, published inMonitorul Oficial -Official Gazette of
Romania -No.159/1996.G/SCM/N/9/ROM
Page3
Level ofGovernment involvement intheimplementation oftheprogramme
TheGovernment allocates outoftheStatebudget theamounts necessary fortheachievement
oftheprogramme 'sobjectives. TheMinistry ofFood andAgriculture isthegovernmental authority
administering therespective subsidies.
Description ofthefinancing instruments usedintheprogramme
- Forenvironment protection andpreservation ofagriculture 'snatural potential, theState
covers thecosts forimproving acidsoils; theState alsocovers costs forpurchasing
60kg.ofactive nitrogen andphosphorus components pertilled hectare, oncondition
thatcontracts beconcluded foratleast40percentoftheoutput obtained bythose
qualifying forthesubsidy;
- Eachyearquantities offertilizers granted freeofcharge bytheStateforvarious tilled
plants aregranted:
- Thestatebears upto50percentoftheselling price ofanimals forreproduction;
- TheState covers upto25percentofthecostofanimals 'upkeep;
- TheState grants afforestation premiums fortheareas where soilscanbestabilized
through thisprocedure:
- Thecredit facilities granted tofarmers arethefollowing:
- subsidization by60percentoftheinterest tocredits forfarms material supply;
- subsidization by70percentoftheinterest tocredits forthepurchase of
tractors, machinery andagricultural equipment;
- subsidizationby75percentoftheinteresttocreditsforagriculturalconstruction
andirrigation.
- Bonuses granted tofarmers fortilled plants, calves, milkandmeatoncondition that
these products besoldthrough specialized economic operators (forsanitary and
phytosanitary reasons);
- Financial facilities intheformofallocations fortheperformance ofcertain basic tills
(forproducts andservices necessary tocarry outthese works);
- Exemption fromthepayment ofcustoms duties forcertain imports made byfarmers
(animals, tractors, equipment, insecticides, fodder). Suchexemptions areestablished
through Government Decisions.
Information onthetermination oftheprogramme
There isnofixed deadline forthetermination oftheprogramme. From thesubsidies granting
point ofviewthetermination willtakeplace incompliance withtheprovisions inthefieldestablished
through theAgreement onSubsidies andCountervailing Measures, aswellaswith Romania 's
commitments intheAgreement onAgriculture.G/SCM/N/9/ROM
Page4
II. PROGRAMME ONTHE STIMULATION OFINDUSTRIAL RESTRUCTURING
Trade policy objectives oftheprogramme, including certain sectoral objectives (when these
canbeidentified)
Theprogramme aimsatensuring thecarrying outofthetransition process through themajor
structural adjustment oftheeconomy andespecially oftheindustry. Theobjective istosupport the
process ofprivatization andrestructuring ofnational economy andthetransition tomarket economy.
Themain sectoral objectives envisaged are:
- Substantial amplification oftheinvestments fortechnological modernization;
- Stimulation ofindustrial regional development;
- Introduction oftechnologies forenvironment protection;
- Stimulation ofsmall andmedium-sized enterprises;
- Rehabilitation oftheenergetic system;
- Stabilization ofmachine building andagricultural equipment industries;
- Structural adjustment oftheindustry forroad, railandseatransportation means;
- Modernization ofthechemical industry;
- Technological upgrading andstabilization ofelectrotechnical andelectronic industries;
- Development ofinfrastructure related toindustrial production.
Legislation
- LawNo.58/1991 ontheprivatization ofcommercial companies.
- Laws ontheState Budget for1995 and1996.
- Government Decision No.805/1994 regarding economic andfinancial incentives for
small andmedium-sized enterprises.
Level ofGovernment involvement intheimplementation oftheprogramme
Onthebasis oftheprogramme forindustrial restructuring, theGovernment issues decisions
granting financial facilities fortheindustrial sectors withaperformant potential.
Description ofthefinancing instruments usedintheprogramme
- Differentiation ofprofit taxandVAT, these being lower fortheproductive sectors
under structural adjustment;
- Reduction ofprofit taxre-invested inproduction;G/SCM/N/9/ROM
Page5
- Recapitalization ofcertain industrial enterprises under theprivatization andstructural
adjustment processes;
- Subsidization ofthemining industry through amounts placed atthedisposal ofthe
producers inthefield, fortheproduction ofcoal,ironandnon-iron oresandrareores;
- Support inbuilding thefinancial resources ofsmall andmedium-sized enterprises
through subsidization ofinterests tocredits.
Information onthetermination oftheprogramme
There isnofixed deadline forthetermination oftheprogramme. From thesubsidies granting
point ofviewthetermination willtakeplace incompliance withtheprovisions inthefields established
through theAgreement onSubsidies andCountervailing Measures.
III. EXPORT INCENTIVES PROGRAMME
Trade policy objectives oftheprogramme, including certain sectoral objectives (when these
canbeidentified)
Under theconditions ofthedismantlement oftheforeign tradeStatemonopoly, ofthestructural
adjustment ofnational economy and,implicitly, ofthetraderelations withother countries, while taking
intoconsideration, theeffects theprivatization inthefieldofforeign trade hadovertheevolution of
trade flows, andinorder toensure theenforcement ofmarket economy rulesinthefieldoftrade, the
programme hasinview:
- thesupply ofuseful information topotential exporters, asregards markets, prices,
businessopportunities,moderncommercializationtechniques,aswellastheorganization
oftraining courses forthebetter useofthisinformation;
- theinsurance ofparticipation inasmany aspossible international fairsandexhibitions,
intheState'seffort tosupport theexporters inidentifying newmarkets;
- theenforcement ofappropriate incentives fortheachievement ofcomplex installations
andlongmanufacturing cycle production forexport;
- thestimulation ofexport production through advantages offinancial nature granted
totheproducers.
Legislation
- Government Decision No.880/1995 ontheorganization andfunctioning ofthe
Romanian Foreign Trade Centre (published in-Monitorul Oficial -theOfficial Gazette
No.271/1995);
- Government Ordinance No.14/1995 oncertain measures forthestimulation ofthe
achievement ofcomplex installations andoftheproduction withlongmanufacturing
cycle, meant tobeexported (published in-Monitorul Oficial -theOfficial Gazette
No.26/1995);
- Laws ontheState Budget of1995 and1996.G/SCM/N/9/ROM
Page6
Level ofGovernment involvement intheimplementation oftheprogramme
TheStatecovers alltherespective expenses inthelimits established bytheLawontheState
Budget.
Asregards thegranting ofsubsidies partially covering theinterests tocredits inlocalcurrency
fortheexport production, theselection ofapplications andallocation oftheamounts isorganized by
theRomanian Export-Import Bank (EXIMBANK) andperformed byanInterministerial Committee
composed, among others, ofrepresentatives oftheMinistries ofFinance andCommerce.
Description ofthefinancing instruments usedintheprogramme
- supply ofcommercial information bytheRomanian Foreign Trade Centre, freeof
charge, through itspublications;
- supply ofmarket surveys against small fees(covering onlythecostofmaterials);
- coverage offunctioning expenses fortheTRADE POINTS;
- partial coverage (upto50percent) oftheexpenses regarding theparticipation in
international fairsandexhibitions;
- guarantees fortheparticipation ininternational auctions;
- guarantees forexport credits;
- subsidization ofupto60percentofinterests todomestic credits innational currency
forexport production, within thelimits oftotalannual amounts established through
theState budget;
- exemption fromthepayment ofcustoms duties, VAT andthecustoms feeforimports
ofparts andcomponents forcomplex installations which aretobeexported.
Information onthetermination oftheprogramme
There isnofixeddeadline forthetermination oftheprogramme. From thesubsidies granting
point ofview, thetermination willtakeplace incompliance withtheprovisions inthefieldestablished
through theAgreement onSubsidies andCountervailing Measures.
IV. PROGRAMME ONTHE STIMULATION OFFOREIGN INVESTMENT INROMANIA
Trade policy objectives oftheprogramme, including certain sectoral objectives (when these
canbeidentified)
Thisprogramme ispartoftheGovernment Programme onthetransition tothemarket economy
andrepresents aninstrument supporting thestructural adjustment andthemodernization oftheeconomy
under theprivatization process taking intoaccount theinsufficient domestic capital resources.
Theprogramme aimsatattracting foreign investment withaviewtofacilitating theprocess
oftransition tothemarket economy andmaking productive investments infields ofprime interest to
theRomanian economy.G/SCM/N/9/ROM
Page7
Legislation
- LawNo.35/1991, modified andsupplemented byLawNo.57/1993 ontheforeign
investment regime;
- LawNo.71/1994 ongranting several additional facilities (ascompared toLawNo.
35/1991, republished), fortheattraction offoreign investors inindustry.
Level ofGovernment involvement intheimplementation ofthisprogramme
Themeasures areimplemented through theRomanian Development Agency, which istheentity
authorized bytheGovernment tocertify thecompliance offoreign investments withthecriteria
established bylawforthisprogramme.
Description offinancing instruments usedintheprogramme
- Exemption frompayment ofcustoms duties fortheimports ofmachinery, installations,
equipment, transportation means andanyother goods imported asparticipation inkind
tothesocial capital, orwhich arepurchased bytheinvestor from theamounts
representing hiscashparticipation tothesocial capital;
- exemption frompayment ofcustoms duties forimports ofrawmaterials andmaterial
supplies necessary fortheproduction process, within atimespanoftwoyears from
thedatewhen theobjective became operational orfromthedatewhen activity started;
- exemption from payment ofprofit tax,asfollows:
(a) forfiveyears, inthecaseofinvestments inindustry, agriculture, construction,
exploration andexploitation ofnatural resources;
(b) forthree years, inthecase ofinvestment intelecommunications and
transportation;
(c) fortwoyears, inthecaseofinvestment intourism, trade, banking andinsurance
services, aswellasinanyother services fields.
- granting profit taxrebates, varying from25to50percentofthedueamount, depending
upon thenature oftheinvestment, after theexpiry ofthetimeperiods when the
exemption from thepayment ofprofit taxwasinforce.
Commercial companies withforeign capital participation, which aresetupintheindustrial
field,benefitfromadditionalfacilitiesonconditionthatthesubscribedparticipationoftheforeigninvestor
amounts toatleastUS$50 million, thatproduction hasadegree ofintegration inRomania ofatleast
60percentofitsvalue andthattheexport represents atleast50percentoftheannual output. The
additional facilities arethefollowing:
(a) exemption frompayment ofcustoms duties forseven years, inthecaseofimports of
machinery, installations, equipment representing participation inkindtothesocial
capital;G/SCM/N/9/ROM
Page8
(b) exemption frompayment ofcustoms duties forseven years, inthecaseofimports of
rawmaterials, material supplies, consumables, spare partsandcomponents tobeused
inthecompany 'sownproduction;
(c) exemption frompayment ofprofit taxforfiveyears fromthedatethecompany makes
aprofit, butnotmore thanseven years from thedatetheproductive activity began.
Information onthetermination oftheprogramme
There isnofixed deadline forthetermination oftheprogramme. From thesubsidies granting
pointofview, thetermination willtakeplace incompliance withtheprovisions inthefields established
through theAgreement onSubsidies andCountervailing Measures, incorrelation withthenotification
presented byRomania inkeeping withtherelevant provisions oftheAgreement onTrade Related
Investment Measures.G/SCM/N/9/ROM
Page9
Unofficial translation
LawNo.83/1993 onthesupport granted bytheState tothefarmers
(published inMonitorul Oficial -Official Gazette -ofRomania No.284/1993)
Art.1
(1) TheStatesupports thefarmers through allocations, subsidies ofinterest ratesrelated
totheproduction andinvestment credits, production bonuses andcompensation, fiscal advantages,
credit guarantees, guarantees forpurchase prices foragricultural products ofnational importance,
technical assistance andother facilities.
(2) Thelistofagricultural products, declared ofnational importance ispublished bythe
Government inMonitorul Oficial (theOfficial Gazette) ofRomania until1September ofeachyear.
Art.2
(1) Production andinvestment allocations aregranted tothefarmers for:improvement
ofsoil,fertility, purchase andmaintenance inexploitation ofreproductive animals andmaterials,
production ofseeds andplanting material.
(2) Thefarmers, intheunderstanding ofthepresent law,aretheowners andlegalholders
ofanimals, agricultural landorforests, situated outside orinside villages, towns orcities, irrespective
oftheform ofexploitation thereof.
Art.3
(1) Theallocations fortheimprovement ofsoilfertility aregranted toagricultural producers
under theform ofamendments andfertilizers, according totheareas theyhold, onthebasis of
improvement andfertilization programmes drawn upbyspecialists authorized therefor.
(2) Thequality ofchemical fertilizers granted under theformofallocation, represents at
least60kg.ofnitrogenandphosphorousactivesubstanceperhectaretilledforwheatorrye,oncondition
thatatleast40percentofthecropbecontracted withauthorized economic operators.
(3) Forother crops, theleveloftheallocation perhectare expressed inkilogrammes of
active substance isestablished, annually, byGovernment Decision.
(4) Theamendment ofacidoralkaline soilsiscovered entirely from theState budget.
Art.4
(1) Thecredits fortheexpansion ofprivately owned agricultural exploitations, aregranted
tothefarmers, natural persons, whoownareas smaller than20hectares ofagricultural landinarable
equivalent. Thecredits aregranted upon request, onthebasis ofownership documents.G/SCM/N/9/ROM
Page10
(2) Land belonging tofarmers forwhich theyhavebenefited fromcredit fortheexpansion
ofprivately owned agricultural exploitations cannot besoldwithout theagreement ofthecrediting bank,
for10years fromthedatethecredit wasgranted, under penalty ofabsolute nullity forselling documents.
Art.5
(1) Allocationsforthepurchaseofreproductiveanimalsandmaterialsaregrantedtofarmers
forvaluable animals certified bytheOffices fortheselection andreproduction ofanimals, ofthespecies
andbreeds established bytheMinistry ofFood andAgriculture.
(2) Thevalue ofallocations goesupto50percentoftheselling price, liveequivalent,
formeatanimals.
(3) Reproductive animals andmaterials, forwhich thefarmers havebenefited from the
allocation provided forinparagraph (1)cannot besoldorslaughtered forfouryears fromthepurchase
date, inthecaseofbovines andfortwoyears inthecaseofother species.
(4) Theallocations formaintenance inexploitation ofreproductive cowsandbuffalo cows
aregranted toallfarmers andrepresents 23percentofannual expenses spent foranimals andspecies
maintenance.
(5) Theallocation isgranted tofarmers whomaintain inexploitation fortheduration of
aproduction cycle atleastthree milkcows orthree buffalo cows.
(6) Theallocationsforthepurchaseandmaintenanceinexploitationofreproductiveanimals
aregranted tothefarmers onthebasis ofsale/purchase documents andofthedataanddocuments
provided bytheagricultural centres, sanitary-veterinary circuit and,asthecasemaybe,bytheOffices
fortheselection andreproduction ofanimals andagricultural research station intherespective area,
aswellasonthebasis ofthemayor 'scertificates.
Art.6
(1) Theownersandotherlegalholdersoflandmeantforafforestationasanti-erosionmeasure
orforthecreation ofprotection curtains benefit, inexchange, from afforestation bonuses.
(2) Theafforestation bonuses aregranted depending ontherespective width ofthearea
bymeans offorest districts, totheowners andother legal landholders, whocommit themselves in
writing toplant andexploit these areas according tothelaw.
Art.7
(1) TheStatesupports theendowment ofagricultural exploitation withtractors, agricultural
machineryandequipment,reproductionandproductionanimals,constructionsofproduction,processing
andstoring spaces, material supply, achievement andturning toaccount oftheagricultural output,
through preferential interest credits or,asthecasemaybe,guarantees toobtain them.G/SCM/N/9/ROM
Page11
(2) Bymeans offinancial orbanking institutions, thefarmers benefit from:
(a) short-term credits withanannual interest subsidized inproportion of60per
cent, formaterial supply andagricultural production;
(b) mid-term credits withanannual interest subsidized inproportion of70per
cent,forthepurchaseofequipment,tractors,machinery,productionandreproductionofanimals;
(c) long-term credits withanannual interest subsidized inproportion of75per
centandaone-yeargraceperiodforinvestmentslike:constructionofanimalshelters,production
andstoring spaces, hothouses, treeandvineplantations, introduction orexpansion ofland
inprivate ownership, irrigation.
(3) Commercial banks cangrant thefarmers credits guaranteed withthelandtheyown.
Until theownership documents areissued, theownership willbeproven byacertificate issued bythe
district commission setupaccording toLawNo.18/1991 onlandownership andbyanownership
enactment report.
(4) Thereturn period ofthecredits provided forinsub-paragraphs (b)and(c)granted
tofarmers inmountain areas canbeprolonged byfivemore years, attherequest ofthecredit
beneficiaries.
(5) Thedifference between market interest andthesubsidy levels provided forin
paragraph (2)iscovered from theState budget.
Art.8
(1) Thebonuses granted tothefarmers fortheagricultural vegetal andanimal products
ofnational importance aredestined to:
- vegetal andanimal products delivered toeconomic operators authorized bytheState
atcontract andpurchase prices guaranteed bytheState;
- calves obtained fromcowsandheifers inseminated artificially ornaturally bycertified
reproducers;
- special landwork.
(2) Thevolume ofthebonuses granted bytheStateforthispurpose isestablished annually
bytheGovernment.
Art.9
(1) Based onthedevelopments intheagricultural products market theGovernment will
establish until1March eachyear, minimum guaranteed purchase prices foragricultural products of
national importance.
(2) Theminimum guaranteed pricerepresents thecountervalue inleiofthemedium price
recorded intheprevious yearontheworld market fortherespective product.G/SCM/N/9/ROM
Page12
Art.10
Theminimum guaranteed prices areestablished, forthepurpose ofthepresentlaw,forcereals,
oilplants, beanvegetables, sugar beet, potatoes, tomatoes forindustrial processing, seeds, seeding
material andfresh milk. TheGovernment canalsoestablish guaranteed prices forother agricultural
products.
Art.11
(1) Forthevegetal andanimal products under contracts witheconomic operators authorized
bytheState, thefarmers benefit, atrequest, from advance payments ofminimum 50percentofthe
value oftheproduction under contract, established onthebasis oftheminimum guarantee price.
(2) Theadvance payments aregranted incashorinrawmaterials andmaterial supplies
bytheeconomic operators authorized bytheState, inunderstanding withthefarmers andareguaranteed
bytheagricultural production belonging tothem.
Art.12
(1) Theimports forreproduction animals, tractors, agricultural machinery andequipment,
agricultural output turntoaccount, insecticides, protein fodders andfodder additives areexempt from
thepayment ofcustoms duties.
(2) Theprovisions ofparagraph (1)areapplicable alsotoforeign aidsinkindgranted to
farmers.
Art.13
(1) Technical andspeciality assistance aregranted atthelevelofeachvillage byspecialized
personnel paidbytheState.
(2) TheMinistry ofFood andAgriculture willensure thepublishing anddistribution of
speciality magazines anddocumentation andwillorganize freeofcharge courses forthetraining,
improvement andcertification offarmers, including courses onthemaintenance, repair andexploitation
oftractors andagricultural equipment, willgrantscholarships fortheyoung people attending agricultural
vocational schools, etc.
(3) Bymeansofitsdepartments,theMinistryofFoodandAgricultureplaces,freeofcharge
atthedisposal offarmers, natural persons, orientative designs andcostestimations forconstructions,
directivesandtechnologiesonplanttilling,animalraising,useofchemicals,protectionofplants,animals
andenvironment; organizes annually fairs, contests, exhibitions, study tours andother suchactivities
ontheexploitation ofprivate farms.
Art.14
(1) Theamounts tocover thecountervalue ofallocations, subsidies, compensations and
fortheactivities provided forinArt.13, granted tothefarmers according tothislawareapproved
annually through thelawontheState Budget, starting on1January 1994.G/SCM/N/9/ROM
Page13
(2) Theamounts provided forinparagraph (1)aregranted tothefarmers bymeans of
theState bodies andother institutions especially authorized bytheGovernment.
Art.15
(1) Theamounts representing theallocation bonuses, compensations, subsidies andother
support measures provided forinthepresent lawaregranted tothefarmers proportionally withthe
rightofownership structure ofthelandfundofRomania.
(2) TheGovernment willestablish, within 60daysfrom thedateofthepresent lawin
Monitorul Oficial (Official Gazette) ofRomania, attheproposal oftheMinistry ofFinance andthe
Ministry ofFood andAgriculture, thewayofidentification through theentire banking circuit ofthe
ownership structures benefitting from thesupport, norms onthewayofgranting anduseaswellas
control ofallocations, bonuses, compensations, subsidies andother support measures provided forin
thepresent law.
Art.16
Thebreach oftheprovisions ofthepresent lawbrings about civilminor offence orcriminal
responsibility, asthecasemaybe.
Art.17
(1) Thefollowing areconsidered asminor offences tothenorm regarding thegrant and
useofallocations, bonuses, subsidies andcompensations, ifcommitted under suchconditions asnot
tobedeemed asoffences according tothecriminal law:
(a) salebyagricultural owners oflandforwhich theybenefited from credits for
theexpansion ofagricultural exploitations, before reaching thedeadline
established inparagraph 4sub-paragraph (2);
(b) notgranting ofbonuses provided forinArt.8;
(c) non-afforestation, asanti-erosion measure orhaving asapurpose thecreation
ofprotection curtains, ofareas established bytheauthorized agricultural or
forest bodies;
(d) notgranting oftechnical andspeciality assistance bythespecialized personnel
paidbytheState;
(e) notplacing atthedisposal offarmers, natural persons, freeofcharge, ofthe
orientative designs andcostestimations forconstruction, directives and
technology onplant tilling, animal raising, useofchemicals, protection of
plants, animals andenvironment.
(2) Theminor offences provided forinparagraph (1)arepenalized asfollows:
(a) fines from lei50to100thousand forminor offences provided forin
paragraph (1)(b), (d)and(e);G/SCM/N/9/ROM
Page14
(b) fines from lei100to250thousand forminor offences provided forin
paragraph (1)(a) and(c);
(3) Thefinescanalsobeapplied tonatural persons.
Art.18
Theminor offences provided forinArt.17 areestablished andthefineisapplied bypersonnel
authorized bytheMinister ofFood andAgriculture orbytheMinister ofWaters, Forests and
Environment Protection, asthecasemaybe.
Art.19
Fortheminor offences provided forinArt.17 theprovisions ofLawNo.32/1968 onthe
establishment andpenalization ofoffences (except Art.25-27) aretobeapplied.
Art.20
Thefollowing areconsidered offenses:
(a) saleofreproduction animals breaching theprovisions ofArt.5, paragraph (3),
tobepunished withdetention from 6months to3years;
(b) deliberate non-maintenance inexploitation fortheduration ofaproduction
cycle ofthenumber ofanimals provided forinArt.5, paragraph (5),which
ispunished withdetention from 3months to2years orwithafine.
Art.21
Useofallocations forother purposes thanthose forwhich theyhadbeengranted, according
toArt.3 ofthepresent law,isanoffence andispunished withdetention from 6months to5years.G/SCM/N/9/ROM
Page15
Unofficial translation
LAW NO.75/1996
ontheproduction, quality control, commercialization anduseofseeds
andseeding material
aswellasontheregistration ofagricultural plants varieties
(published inMonitorul Oficial -Official Gazette -ofRomania No.150/1996)
-excerpts -
Art.44
Theagriculturalcommercialcompanies,agriculturalcompanies,agriculturalassociationswithout
being legalpersons aswellasindividual farmers benefit froma50percentreduction oftheprice of
seeds andseeding material, when bought fromauthorized producers, under thefollowing conditions:
- whenreplacingtheseedsforcereals,beans-vegetables,autumnpotatoes,technicalplants
andfodder, every three years;
- when replacing theseeds formaize, sunflower, sorghum, sugar beet,other vegetables,
tobacco, early potatoes, annually.G/SCM/N/9/ROM
Page16
Unofficial translation
LAW NO.84/1996
ONLAND RECLAIMING
(published inMonitorul Oficial -Official Gazette -ofRomania No.159/1996)
-excerpts -
CHAPTER V
FINANCING
Art.27
Thefollowing activities arefinanced from theState budget:
- research inthefieldoflandreclaiming;
- feasibility studies, technical projects andsimilar activities forinvestment objectives
inthefield;
- repairs ofbuildings andequipment forlandreclaiming:
- landreclaiming fortheprotection oftheenvironment;
- activities toprevent floods andother dangerous phenomena.
Art.28
Theexpenses fortheexploitation, maintenance andrepairing ofthelandreclaiming system
arecovered bythebeneficiaries. Suchexpenses canbesubsidized, totally orpartially, fromtheState
budget.G/SCM/N/9/ROM
Page17
Unofficial translation
LAW NO.58/1991 ONTHE PRIVATIZATION
OFCOMMERCIAL COMPANIES
(Published inMonitorul Oficial -Official Gazette -ofRomania No.169/1991)
-Excerpts -
Chapter III
Establishment andorganization oftheState Ownership Fund
Art.23.TheStateOwnership Fund isestablished asapublic institution, being alegalperson
andacting asacommercial andfinancial company.
............................................................................................
Art.25.Asshareholder, theStateOwnership Fund hasallrights andobligations established
bylawasfarasrelations withother commercial companies areconcerned.
Tothisaim,theState Ownership Fund hasthefollowing main obligations:
............................................................................................
(c) takesthenecessaryactioninordertorestructureandrehabilitatecommercialcompanies,
or,asthecasemaybe,toliquidate unprofitable commercial companies;
Art.26.TheStateOwnership Fundisorganized, actsandtakesdecisions onlyonacommercial
basis.
Theincome belonging totheStateOwnership Fund willbeused, asdecided bytheBoard of
Administration, for:
............................................................................................
(b) investments forrestructuring, rehabilitating andmaking profitable thecommercial
companies, insuchawaysothattherespective investments would notincrease the
share ofState capital inthose companies;
............................................................................................
(d) financing thecosts regarding privatization ofcommercial companies.G/SCM/N/9/ROM
Page18
Unofficial translation
Government Ordinance No.14/1995
oncertain measures forthestimulation
oftheachievement ofcomplex installations and
oftheproduction withlongmanufacturing
cycle, meant tobeexported
(Published inMonitorul Oficial -Official Gazette -ofRomania No.26/1995)
-Excerpts -
Byvirtue oftheprovisions ofArt.107,paragraphs (1)and(3)oftheConstitution ofRomania
andofArt.1,letter (d)ofLawNo.1/1995 ontheGovernment 'sauthorization toissue ordinances.
TheGovernment ofRomania issues thefollowing ordinance:
Art.1:Thepresentordinancerulesthemeanstostimulatetheproductionwithlongmanufacturing
cycle, thecomplex exports andthewaytoachieve these.
Art.2:Thestimulations oftheachievement ofcomplex installations andoftheproduction
withlongmanufacturing cycle meant tobeexported isperformed through:
(a) guarantees fortheparticipation ininternational biddings, execution ofworks andother
guarantees established through external contracts;
(b) stateguarantees granted fortheshort, medium andlong-term credits usedforthe
production inthecountry andabroad, destined tocomplex exports, aswellasforexport
credits uptoeight years;
(c) granting bonuses of60percentoftheinterest tocredits fortheexport ofcomplex
production;
(d) insurance, inthename andontheaccount oftheState, oftheexport credits onmedium
andlong-term forcountry risk;
(e) exemption fromthepayment inadvance orfromtheguarantee ofthecustoms duties,
ofthecustoms feeandofVAT fortheimports ofparts andcomponents.
Art.3: Theguarantees provided forinletters (a)and(b)ofArt.2ofthepresent ordinance
areissued bytheStatethrough theMinistry ofFinance, aftertheendorsement oftheInterministerial
Committee onForeign Trade Guarantees andCredits, granted attheproposal oftheExport-Import
Bank ofRomania.
Art.4: Thebonuses provided forinArt.2,letter (c)areestablished totheinterest paidby
theeconomic operators totheshort, medium andlong-term credits, usedfortheexport production,G/SCM/N/9/ROM
Page19
aswellasfortheperiod untilthecounter-value ofthecomplex exports iscashed, onthebasisofrequest
andceiling reservation forthegrant ofinterest bonuses.
Theestablishment, endorsement andgrantofinterest bonuses, aswellastheinsurance ofexport
credit against country risks areperformed incompliance with theprocedures approved bythe
Interministerial Committee.
Art.5:Thefinancial resources necessary fortheimplementation ofthisordinance arecovered
from:
(a) theamounts provided forintheState budget forthispurpose;
(b) collection ofaquota of25percentofthecounter-value inlei,duetotheState from
theexternal debts effectively recovered from thedebit countries;
(c) Interest cashed from thefructified deposits.
Art.7:Thecoordination ofthestimulation activity ofcomplex exports isperformed bythe
Interministerial Committee onForeign Trade Guarantees andCredits.
Theresources management andthepayments forthestimulation ofcomplex exports willbe
performed bytheExport-Import Bank ofRomania.G/SCM/N/9/ROM
Page20
Unofficial translation
Government Decision No.880/1990 ontheorganization and
functioning oftheRomanian Foreign Trade Centre
(Published inMonitorul Oficial -Official Gazette -ofRomania No.271/1995)
-Excerpts -
Art.1
(1) TheRomanian Foreign Trade Centre (RFTC) issetupasapublic institution withlegal
personality under thesubordination oftheMinistry ofCommerce, bytaking overthepatrimony and
activities oftheNational Institute ofCommercial Research "Virgil Madgearu" which ceases itsactivity,
aswellasoftheactive andpassive ofthecommercial company "SICOMEX" S.A.which ceases its
existence.
(2) Theheadquarters ofRFTC isinBucharest.
(3) Functioningandinvestmentcostsarecoveredfromextra-budgetaryincomesandsubsidies
granted from theState budget.
Art.2
TheRFTC willhaveasitsmainobjective thepromotion ofRomanian foreign trade, informatics,
advertising andresearch inthefieldoftrade andhasthefollowing main functions:
- promotion andimplementation ofgovernment decisions inthefieldoftrade policy
byproviding consultancy toeconomic operators;
- promotion ofnorms, standards andrecommendations onthefacilitation ofinternational
trade procedures, electronic datainter-exchange, participation inexpert groups inthe
field, atinternational, regional andnational level;
- design andimplementation ofpilotprojects complying withthepresent international
standards forcarrying outforeign anddomestic tradeactivities andelectronic datainter-
exchange atthelevelofeconomic operators andofthepublic administration;
- elaboration ofmarket surveys byproducts andcountries;
- elaboration ofprogrammes onthepromotion oftheRomanian foreign trade;
- publishing specialized documentation;
- elaboration ofpractical methodological studies onthedomestic andinternational trade
techniques.
- development andexploitation oftheinformatic system oftheRomanian tradestatistics
onthebasisofimport andexport customs declarations, incooperation withtheGeneral
Customs Directorate andtheNational Commission forStatistics;G/SCM/N/9/ROM
Page21
- setupautomated working postsatthelevelofthedirectorates andoffices intheMinistry
ofCommerce, withinter-active access tothedatabaseoftheRFTC;
- designing theintegrated informatic system fortheuseofdomestic andforeign trade,
development andmanagement oftheadequate hard architecture atnational and
international level:
- development andexploitation ofthepublic databaseofinformation onthedomestic
andforeign trade, international andnational trade rules, business partners andtheir
financialstanding,businessopportunities,domesticandinternationalprices,international
andnational tradeflows (toserve thepublic administration andtheeconomic operators).
Art.3
TheRFTC willplaytheroleofnational centre ofcommercial information (TRADE POINT)
connected totheWorld Trade Points Network.G/SCM/N/9/ROM
Page22
Unofficial translation
LawNo.22/1995 ontheState Budget for1995
(Published inMonitorul Oficial -Official Gazette -ofRomania No.53/1995)
-Excerpts -
Art.18
Forthefinancing oftheNational Programme forResearch Development, inorder tosupport
fundamental andapplicative research programmes theamount oflei442.9 billion isallotted. The
distribution oftheamounts forprogrammes willbedoneaccording tothelaw.
Inorder tosupport theimplementation oftheresearch results, upto20percentoftheexpenses
occurred inputting intopractice these results canbecovered bytheMinistry ofResearch and
Technology, onthebasis ofGovernmental Decisions.
Art.22
(1) For1995, theamounts forstimulating theproduction forexport andtheexport are
established attheleveloflei75.0billion, outofwhich:
(a) lei65billion forthestabilization oftheinterest ratefortheshort, medium andlong-term
credits granted bytheRomanian Export-Import Bank S.A.andbytheCommercial
Bank fortheproduction forexport andfortheexport ofmachinery, complex
installations andthecarrying outofprojects abroad, aswellasforotherexports credited
onshort-term, for1996, according tothelaw.
(b) lei10billion fortheinsurance, inthename andontheaccount ofthestate, oftheexport
credits granted in1995.G/SCM/N/9/ROM
Page23
Unofficial translation
LawNo.29/1996 ontheState Budget for1996
(Published inMonitorul Oficial -Official Gazette -No.91/1996)
-Excerpts -
Art.16
Forthefinancing oftheNational Programme forResearch Development, ofother fundamental
andapplicative research activity aswellasfortechnological development andother research -
development activities, theamount oflei518.1 billion isallotted, outofwhich lei90billion forthe
co-financingofseveraltechnologicaldevelopments,technologicaltransferandimplementationofresults.
Art.17
For1996, theexpenses forstimulating theproduction forexport andtheexport areestablished
attheleveloflei130billion, outofwhich:
(a) lei120billion forthestabilization oftheinterest ratefortheshort, medium andlong-
termcredits granted bytheRomanian Export-Import BankS.A.andbytheCommercial
Bank fortheproduction forexport andfortheexport ofmachinery, complex
installations andthecarrying outofprojects abroad, aswellasforotherexports credited
onshort-term, during 1995 and1996, according tothelaw.
(b) lei10billion fortheinsurance, inthename andontheaccount oftheState, ofthe
export credits granted in1996.G/SCM/N/9/ROM
Page24
Unofficial translation
GOVERNMENT DECISION NO.805/14.11.1994
Regarding economic andfinancial incentives forthe
small andmedium-sized enterprises
(Published inMonitorul Oficial -Official Gazette -ofRomania No.33/1.12.1994)
OnthebasisoftheGovernment Ordinance No.25/25.08.1993 regarding incentives forsmall
andmedium-sized enterprises,
TheGovernment ofRomania decides:
Art.1
Inorder tocreate newworking places andtopromote productive activities inindustry,
construction, tourism andservices forwhich Value Added Taxiscollected, those activities involved
inresearch-development intheprivate sector, thesmall andmedium-sized enterprises (SMEs) which
areacting inoneofthefields here-above mentioned benefit from reduced interest credits.
TheRomanian Development Agency, onthebasisoftheoffers received fromthecommercial
banks, select under acompetition system thebankorthebanks onbehalf ofwhich willopenacredit
lineintheamount oflei3.0billion, anamount which hasbeenallotted withthisdestination through
theState Budget for1994.
Thecommercial company "Fondul Român deGarantare aCreditelor pentru Intreprinza tori
Privat¸i"S.A.guarantee thecredits given toenterprises lacking theneeded guarantees, according to
itsworking procedures.
Thecredit beneficiaries willpayaninterest ratereduced tothelevel of50percentofthe
reference interest rateoftheNational Bank ofRomania, aswellasthecommission collected bythe
banking unitfortheoperations. Thiscommission ispaidmonthly andisnegotiated withthebank.
Art.2
Thecredits aregranted tobeneficiaries established according toOrdinance No.25/1993 and
which observe, cumulatively, thefollowing conditions:
(a) topresent theinvestment project forwhich thecredit isasked;
(b) theinvestment project tohaveasamain objective productive activity, construction,
services, mountain tourism andagro-tourism;
(c) thebeneficiary tobealegalperson;
(d) thepersons hired onthebasisofacontract torepresent atleast90percentofthetotal
labour force utilized;G/SCM/N/9/ROM
Page25
(e) during theperiod forwhich thecredit isgranted, toallotatleast80percentofits
profits forthedevelopment oftheenterprise, thereimbursement ofthecredit, the
payment oftheinterest andthebanking commission.
Art.3
Credits aregranted under thefollowing conditions:
(a) thebeneficiary hastocover atleast20percentoftheproject value; thislevel can
belowered depending onthenature oftheproject;
(b) thevalue ofthecredit tobeunder lei50million;
(c) credits aretobereimbursed within amaximum ofthree years, withaholiday period
ofsixmonths from thedateofthecredit allotment;
(d) thebeneficiary engages himself toobserve thedestination ofthecredit;
(e) suchfacilities canbegiven toanenterprise onceinaperiod ofthree years.
Fortheratespaidaftertheduetime, allinterests arewithout anyreduction.
TheRomanian Development Agency concludes convention withthebanks selected according
toArt.1withaviewtoutilizing thecredit linesopened fortheincentives tobegiven toSMEs.
Art.4
Theequipment, machinery, other goods andutilities cannot besoldbefore thetotalcoverage
ofthegranted credits.
Art.5
Theamounts collected fromthereimbursement ofthecredits andthedueinterests willfeed-back
thecurrent account ofthecredit lineopened atthebanks selected bytheRomanian Development Agency,
credit lineswhich willpreserve itsdestination forthecoming years.
Art.6
Inorder toanalyse thefinancial demands, ithasorganized aFinancing Committee, formed
bytherepresentatives oftheRomanian Development Agency, the"Fondul Român deGarantare a
Creditelor pentru Intreprinza toriPrivat¸i"S.A. andtheUnion oftheHandicrafts Cooperatives
(UCECOM).
Art.7
TheRomanian Development Agency, "Fondul Român deGarantare aCreditelor pentru
Intreprinza toriPrivat¸i"S.A.andUCECOM, having thefavourable acceptance oftheFinance Ministry,
willdraw upin20days, themethodological norms forputting intoforce ofthepresent Decision.
Art.8
TheRomanian Development Agency isresponsible fortheimplementation ofthepresent
Decision.G/SCM/N/9/ROM
Page26
Unofficial translation
FOREIGN INVESTMENT LAW
No.35/3April 1991
(Republished inMonitorul Oficial -Official Gazette -ofRomania No.185/1993
onthebasis ofArt.2ofLawNo.57/1993 regarding amendment and
completion ofLawNo.35/1991)
TheParliament ofRomania passes thepresent law.
Toinduce foreign investment inRomania thepresent lawispassed comprising provisions meant
tobring foreign investors guarantees andincentives aswellasthecomplete andunrestrained useof
theresults oftheiractivity.
Chapter I
General Provisions
Art.1
Forthepurposes ofthislaw,theterm"Foreign Investment inRomania" shallmean:
(a) establishmentofnewcompanies,subsidiariesandbranches,eitherhavingwholly-owned
foreigncapitalorbyassociationwithRomanianlegalornaturalpersons,withobservance
ofCompany LawNo.31of1990;
(b) participation intheincrease ofregistered capital ofanexisting company orthepurchase
ofshares orcapital stock belonging tosuchcompanies, aswellasbonds andother
securities;
(c) concession, leasing ormanagement contracts, asprovided forbythelaw,ofbusinesses,
public services, production subunits, pertaining toautonomous stateenterprises orto
commercial companies;
(d) acquisition ofownership rights overrealandpersonal property aswellasotherproperty
rights, except forthelandownership rights;
(e) acquisition ofindustrial andintellectual rights;
(f) acquisitionofpersonalpropertyrightsorotherrightsrelatedtoserviceshavingeconomic
value thatareassociated toaninvestment;
(g) purchase ofproduction spaces andother buildings, except forresidence buildings not
related totheinvestment, aswellastheconstruction thereof;
(h) participation agreements forexploration, exploitation andproduction sharing ofnatural
resources.G/SCM/N/9/ROM
Page27
Art.2
"Participation" offoreign investors inRomania mayconsist of:
(a) funds infreely convertible currencies;
(b) machinery, equipment, means oftransport, components, spare partsandother goods;
(c) services, industrial andintellectual property rights (patents, licences, know-how,
trademarks, copyrights), expertise andmethods oforganisation andmanagement;
(d) revenues andprofits derived fromactivities carried outinRomania, aswellasgoods
andvalues acquired withobservance oflegalprovisions, afterpayment oftaxes and
duties assetforth bythelaw.
Art.3
Theterm"Foreign investor" shallmean anynatural orlegalperson residing or,asthecase
maybe,having itsdomicile orheadquarters abroad, andwhich isconducting investment inRomania
under anyoftheforms setforth bythislaw.
Art.4
Foreign investments maybeeffected inallsectors ofindustry, exploration andproduction of
natural resources, agriculture, infrastructure andcommunication, civilandindustrial works, scientific
research andtechnology development, trade, transportation, tourism, banking andinsurance services
andother services, provided thattheyshallnot:
(a) infringe theenvironment protection regulations inforce;
(b) affect Romania 'snational security anddefence interests;
(c) harm thepublic order, health andgood morals.
Chapter II
Guarantees
Art.5
Theforeign investments inRomania shallnotbenationalized, expropriated, requisitioned or
subjected toother measures oflikeeffects, except inpublic interest, withobservance ofthelegal
procedures setforth bythelawandagainst payment ofacompensation equivalent totheaffected
investment which shallbeprompt, adequate andeffective.
Art.6
Thecompensation shallbeassessed inrelation tothemarket value oftheinvestment uponthe
dateofoccurrence ofoneoftheactssetforth inArt.5.G/SCM/N/9/ROM
Page28
Art.7
Incasethecompensation cannot beascertained asprovided forinArt.6hereinabove, then
itshallbedetermined bytheparties onequitable principles, taking intoaccount thecapital invested,
itsappreciation ordepreciation andthecurrent returns.
Art.8
Should thecompensation determined asperArt.6orArt.7hereinabove notbesatisfactory
attheforeign investor, thenitshallbeestablished upontheforeign investor 'srequest through thecourts
oflaw,inaccordance withthelegalprovisions.
Art.9
Theforeign investors shallenjoy therights to:
(a) participate inthemanagement andadministration oftheinvestment, inkeeping with
theterms ofthecontracts andby-laws agreed upon;
(b) assign itscontractual rights andobligations toother Romanian orforeign investors;
(c) integrally transfer abroad theannual profits theyareentitled to,under theconditions
oftheRomanian foreign currency provisions, afterpayment oftaxes, duties andother
obligations assetforth bytheRomanian legislation.
(d) transfer abroad, inkeeping withtheprovisions ofthecontracts concluded, theamounts
collected forcopyrights, technical assistance, expertise andother services;
(e) transfer abroad theamounts obtained fromthesaleofshares, bonds andothersecurities
aswellasthose derived from liquidation ofinvestment, under theconditions ofthe
Romanian foreign currency provisions;
(f) transfer abroad intheagreed upon freely convertible currency theamounts achieved
ascompensation intheevent oftheoccurrence ofoneoftheactions provided inArt.5
hereinabove.
Art.10
Theforeign investment effected inaccordance withtheprovisions ofthislawenjoy thelegal
status setforth hereby forthewhole duration oftheirexistence totheextent asubsequent lawshall
notsetforth more favourable provisions.
Art.11
Theforeign investors shallenjoy thelegal status setforth bythislawirrespective oftheir
citizenship or,asthecasemaybe,nationality.G/SCM/N/9/ROM
Page29
Chapter III
Incentives
Art.12
Imported machinery, equipment, installations, means oftransportation andanyother outfits
necessary forinvestment areexempt from import customs duties provided thatsuchimported items
represent theequity cashcontribution inkindorarepurchased from theequity cashcontribution of
theforeign investor totheregistered capital ofthecompany ortoanyincrease thereof.
Art.13
Therawmaterials, consumables, spare partsandother supplies, necessary forandeffectively
usedbytheforeign investor foritsownproduction purposes areexempt fromimport customs duties
foraperiod oftwoyears, counted fromthedatetheproject iscommissioned or,asthecasemaybe,
from thedateofcommencing theactivity depending onthelegalstatus oftheforeign investment.
Art.14
Foreign investments areexempt from payment oftaxonprofit asfollows:
(a) investments inindustry, agriculture, construction sector, exploration andexploitation
ofnatural resources foraperiod offive(5)years fromcommencing productive activity;
(b) investments incommunications andtransport, foraperiod ofthree (3)years from
commencing therespective operations;
(c) investments intrade, tourism, banking andinsurance services, aswellasanyother
services, foraperiod oftwo(2)years from commencing therespective operations.
Foreign investments defined atArt.1,letter(a)ofthislawshallbenefit fromthetaxexemptions
provided byArt.14hereinabove oncondition thatthetotalcontribution inkindandcasheffectively
disbursed bytheforeign investor accounts foratleast20percentoftheregistered capital butnoless
thanUS$10,000.
Foreign investments thatdonotmeetthese conditions shallbesubject totheprovisions ofthe
common law.
Art.15
Inaddition totheexemption provided forhereinabove, reductions ofthetaxonprofits are
further granted aftertheexpiration oftheinitial taxholiday period, asfollows:
(a) a50percentreduction ofthetaxduefortheprofits reinvested inenterprises setup
inRomania withaviewtowidening andupgrading thetechnical andmaterial basis,
improvingthemanufacturingtechnologiesorexpandingtheactivity,toobtainadditional
profits, aswellasfortheinvestments aimed atprotection oftheenvironment;
(b) a25percentreduction ofthetaxdue,provided thatoneofthefollowing conditions
ismet:G/SCM/N/9/ROM
Page30
- atleast50percentofthenecessary rawmaterials, energy andfuelareprovided
through importation;
- atleast50percentoftheproducts andservices areexported;
- more than10percentoftheexpenditures aremade forscientific research and
development ofnewtechnologies inRomania andforprofessional training;
- atleast 50percentofthemachinery andother equipment necessary for
developing existing investments areobtained from domestic production;
- atleast50(fifty) newjobsarecreated through anewinvestment orexpansion
ofexisting investments.
Art.16
Forinvestment effected inthefields ofparticular interest forthenational economy, onproposal
oftheGovernment, additional facilities canbegranted bylaw.
Art.17
Incasevoluntary liquidation offoreign investment occurs within atimespanshorter thantwice
theperiod forwhich foreign investors enjoy theexemptions provided foratArt.14hereinabove, foreign
investors shallpaythetaxes onprofits imposed bythelawforthewhole duration oftheinvestment.
Thetaxes dueinaccordance withtheprovisions oftheabove paragraph shallbepaidwith
priority outoftheresults deriving fromtheliquidation oftheinvestment oroutoftherights theforeign
investors areentitled to.
Chapter IV
Promotion andRegistration ofForeign Investments
Art.18
Foreign investments inRomania, irrespective oftheirlegalstatus, shallbemade onthebasis
ofanapplication bytheforeign investor registered withtheRomanian Development Agency.
Art.19
TheRomanian Development Agency shallstudy thereliability oftheinvestor, thefieldand
thelegalform oftheinvestment andtheamount ofthecapital tobeinvested.
Art.20
TheRomanian Development Agency answers applications offoreign investors onthebasis
ofdataandinformation available toitorthatitmayobtain upon request from thecentral andlocal
organizations ofpublic administration aswellasfrom autonomous stateenterprises andcommercial
companies inthefieldofactivity where theforeign investment shallbemade.
Theministries andtheothercentral andlocalorganization ofpublic administration shallanswer
within tendaystherequest oftheRomanian Development Agency.G/SCM/N/9/ROM
Page31
Art.21
TheRomanian Development Agency shallanswer theapplications offoreign investors within
30daysoftheirregistration.
Intheevent thatnoconfirmation isreceived bytheforeign investor during thetimeperiod
setforth intheabove paragraph, theinvestment shallbedeemed tohavebeenapproved andmaybe
implemented.
Art.22
Theforeign investors havetherighttoeffect investments under theconditions setforthinthe
Romanian law,either onthebasisoftheconfirmation issued bytheRomanian Development Agency,
oronthebasis offoreign investor 'sapplication intheabsence ofanyresponse from theAgency.
Art.23
Thestatus offoreign investors inRomania isproven bythe"Certificate ofInvestor" issued
bytheRomanian Development Agency.
The"Certificate ofInvestor" shallbeissued attheforeign investor 'srequest within 15(fifteen)
daysofregistering theapplications, uponpresentation ofrelevant documents -thecontract ofassociation
andthestatute, thecommercial contracts andotherlegalpapers drafted inaccordance withtheprovisions
oftheRomanian lawandtaking intoconsideration thelegalstatus oftheinvestment.
The"Certificate ofInvestor" isopposable totheRomanian authorities fortheestablishment
oftheforeign investor 'srights.
Chapter V
Financial, Foreign Currency andCommercial Operations
Art.24
Thecollectionandpaymentoperationsrelatedtotheforeigninvestmentsshallbeeffectedthrough
accounts opened withbanks having theheadquarters inRomania orabroad, inaccordance withthe
regulations setforth bytheNational Bank ofRomania.
Commercial companies withforeign participation andforeign investors shallhavetheright
todispose oftheamounts available intheirownaccounts.
Thecommercial companies maykeepintheirownaccounts theamounts inforeign currency
deposited asequity contribution totheregistered capital.
Art.25
Theaccounts shall befedfrom theinvestor 'sfinancial contribution, contracted loans and
revenues.G/SCM/N/9/ROM
Page32
Art.26
Jointventures andother foreign investors maycontract credits inleiorother currencies from
localfinancing institutions orloans infreely convertible currencies from foreign banks andfinancial
institutions.
Art.27
Theactivity ofthejointventures andoftheforeign investors shallbecarried outonthebasis
ofcommercial contracts concluded withtheobservance ofthelegalprovisions, atagreed-upon prices.
Art.28
Thepayments inforeign currency, including theamounts duetotheforeign investor, shall
beeffected from theamounts available intheirownaccounts orbypurchasing foreign currency at
theofficial exchange rate.
Art.29
Theprofits infreely convertible currency andinleiduetotheforeign investors canbeused
tomake newinvestments inRomania, tobuyRomanian goods andservices ortheymaybeexchanged
onthefinancial market withobservance ofthelegalprovisions.
Chapter VI
Final Provisions
Art.30
Intheevent foreign investments inRomania aremade bysetting-up commercial companies
inassociation withRomanian natural orlegalpersons, thecontribution oftheRomanian partners to
theregistered capital mayconsist ofthetitledeedorother realrights overlandorother realassets
necessary estate forthewhole duration ofthejointventure.
Art.31
Theexpatriate personnel necessary tooperate theforeign investment shallbeagreed uponby
thecontracting parties orbytheforeign investor, asthecasemaybeandmayholdonlymanagement
andexpert positions.
Art.32
Thewagesoflocalandexpatriatepersonnelemployednecessarytoimplementforeigninvestments
shallbesettled bytheagreement oftheparties.
Art.33
Theprovisions ofthislawshallbeapplied totheextent thattheinternational agreements and
arrangements offoreign investments undersigned byRomania donotprovide otherwise.G/SCM/N/9/ROM
Page33
Art.34
Upon thecoming intoeffect ofthislawDecree No.424of1972 regulating theestablishment
andfunctioning ofjointventures inRomania, theDecree-Law No.96of1990forinducement offoreign
investment inRomania, aswellasanyother contrary legalprovisions, areabrogated.G/SCM/N/9/ROM
Page34
Unofficial translation
LAW NO.71/1994
SUPPLEMENTARY INCENTIVES TOLAW
No.35/1991
republished, forinducing foreign investments inindustry
(Published inMonitorul Oficial -Official Gazette ofRomania No.189/1994)
TheParliament ofRomania passes thepresent law.
Art.1
Thecompanies withforeign participation established according tolaw,inthefieldorindustry,
having aminimum foreign capital ofUS$50 million, deposited inthecompany 'saccount (thebank
being aRomanian legal person) carrying out,inconformity withthecompany contract, production
activities withaminimum 60percentintegration levelinRomania andaminimum export share of
50percentwithin annual turnover, willbegranted thefollowing incentives:
(a) starting withtheregistration dateofcompany, aseven yearexemption fromcustoms
duties forallnecessary imported equipment, machines, outfits, considered tobe
contribution inkindorpaidfrom ownsources, drawn orborrowed;
(b) starting withtheregistration dateofthecompany, aseven yearexemption fromcustoms
duties ofallrawmaterials, consumables andspare parts forproduction purposes of
thecompany, paidfrom ownsources, drawn orborrowed;
(c) exemption fromtaxonprofit foraperiod offiveyears fromthedateofachieving profit,
butnomore thanseven years from commencing production.
Art.2
Incasethat,within 14years fromregistration date,thecompany reduces itssubscribed capital
sothatthecontribution oftheforeign investor drops under theminimum ofUS$50 million oris
voluntarily liquidated, thecompany isliable topayalltaxes andfees,asifhaving beengranted no
incentives, including theperiod oftaxholiday.G/SCM/N/9/ROM
Page35
Unofficial translation
LAW NO.66/1992
concerning thegrant offacilities inorder toattract foreign
capital inthefieldofexploration andexploitation ofoilandgasfields.
(Published inMonitorul Oficial -Official Gazette ofRomania No.166/1992
TheParliament ofRomania adopts thepresent law.
Pursuant toArt.17ofLawNo.35of1991, thepresent lawisadopted inorder toattract foreign
capital intheactivities ofexploration forandexploitation ofoilandgasfields including those forthe
purpose ofenhancing oilrecovery fromreservoirs andtoregulate thefacilities which canbegranted
toforeign investors whocontract tocarry outoperations inthese fields.
Art.1
Foreign investors whocontract toexplore forandexploit oilandgasfields andtoshare
production, including works forthepurpose ofenhancing oilrecovery from reservoirs, aregranted
thefollowing facilities:
1. Withregard tothepayment oftaxonprofit resulting fromactivities provided forbythepresent
law:
(a) theRomanian contracting party shallpaythetaxonprofit onbehalf oftheforeign
investors andthefinancial authorities shallannually issueacertificate which willprove
thispayment; theamounts sopaidshallbeconsidered asincome fortheforeign investor
andexpenses fortheRomanian contracting party whoshall cover them from an
additionalshareoftheactualproduction,suchsharehavingbeennegotiatedaccordingly:
or
(b) Thetaxonprofit shallbepaidinaccordance withthetaxratesprovided bythelaw
inforce atthetimeoftheconclusion ofthecontract.
2. With regard tocustoms duties:
(a) acustoms duties exemption fortheimports necessary fortheexecution ofexploration
andexploitation operations andenhanced oilrecovery operations effected bytheforeign
investor oritssub-contractor;
(b) acustoms duties exemption fortheimports ofhousehold andpersonal goods necessary
totheforeign personnel oftheinvestor, ofitsaffiliated companies andofitsforeign
sub-contractors; thegoods exempted from customs duties shallbelisted inannexes
tothecontract;
(c) acustoms duties exemption fortheexport ofshares ofoilandgasduetotheforeign
investor asaresult ofproduction sharing aswellasoftheexport ofgoods imported
bytheforeign investor anditspersonnel under theterms provided byparagraph (b).G/SCM/N/9/ROM
Page36
Art.2
Apart from thefacilities provided forbyArticle 1,theforeign investors andtheiraffiliated
companies, aswellastheirforeign personnel, areexempted frompayment ofanyduties ortaxes, other
thanthose provided forbytheannex tothepresent law,foractivities directly related totheobject
ofthecontract.
Art.3
Theforeign investor isentitled toreceive, transfer orretain abroad, freeoftax,andtouse
without anyrestriction, theproceeds obtained from thesalesofitsshare ofoilandgas. Inthecase
thattheforeign investor obtains domestic currency fromsuchsaleseffected inRomania inexcess of
itsimmediate needs, itshallhavetherighttoexchange itintoconvertible currency under theconditions
laiddown bylaw,tofreely transfer itandtoretain itabroad.
Art.4
Inorder toestablish thecontinuing obligations which shall beassumed bytheRomanian
contracting party, according toArticle 1paragraph 1(a)onbehalf oftheforeign investor, thetaxlaws
inforceatthedateofconcluding thecontract shallbeapplicable fortheentire duration oftheircontract.
Pursuant tothepresent law,thefacilities granted toforeign investors areestablished foreach
contract fortheentire duration ofthecontract, which cannot belonger than30years.
Thecontracts shallbeconcluded under thecondition thattheywillcome intoeffect atthetime
oftheirapproval bythegovernment.
Thislawisadopted bytheChamber ofRepresentatives atitssession of25June1992 in
compliance withtheprovisions ofArticle 74,paragraph 2oftheConstitution ofRomania.