WT/TPR/S/155/Rev.1 Trade Policy Review 
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IV. TRADE POLICIES BY SECTOR 
(1) OVERVIEW  
1. Since Romania's last TPR in 1999, the cont ribution of manufacturing to the economy has 
continued to increase, while the share of agricultu re has remained broadly unchanged. Romania is 
implementing a 2004-25 agriculture strategy aimed at ensuring food security and self-sufficiency. 
Average tariff protection in agriculture (major di vision 1 of ISIC, Revision 2) went from 16.9% in 
1999 to 16.2% in 2005. The limited liberalization of  agricultural products in Romania's preferential 
trade agreements reduces their exposure to greater competition. 
2. Romania is rich in minerals;  it is the largest producer of crude oil and natural gas in Central 
and Eastern Europe, and has significant reserves of coal.  It is also a leading electricity producer in the 
region. However, arrears in mining and energy contri bute to the financial difficulties of the companies 
operating in the sector, and impose a big burden on the public budget (almost 10% of GDP in 2003).  
The sector is being restructured with a view to a ddressing its inefficiencies and preparing it for EC 
accession;  private enterprises are to take an increasi ngly important role. Applied MFN tariffs average 
5.2% in mining and quarrying (major division 2 of ISIC, Revision 2), down from 5.5% in 1999. 
3. Tariff protection in manufacturing (major divi sion 3 of ISIC, Revision 2) average 17.7% 
(down from 20.2% in 1999); a high rate of 220% app lies to a  category of mixtures of odoriferous 
substances (including alcohol solutions) a mixtures w ith a basis of one or more of these substances of 
a kind used in the food or drink industries (Table AIV.1).1  The manufacturing sector is relatively 
diversified, with private ownership increasing mainly  due to the recent acceleration in privatization. 
The sector is a major beneficiary of government support, including state aid to domestic producers, 
and investment incentives (e.g. duty and tax concessions) to promote, inter alia , free zones, industrial 
parks, and SMEs. 
4. Romania has taken steps to address some of the structural problems in certain services 
activities. The financial services supervisory frame work has been strengthened, and Romtelecom's 
monopoly on the fixed telephone mark et was terminated at the end of 2002. Several state-owned 
enterprises (SOEs) in the sector have been privatized . Nevertheless, further steps need to be taken to 
upgrade Romania's infrastructure, roads in partic ular. Under the General Agreement on Trade in 
Services, Romania made commitments in several se rvices categories (Table AIV.2), but maintains 
some MFN exemptions.  
(2) AGRICULTURE AND RELATED ACTIVITIES  
(i) Main features 
5. Agriculture is one of the key sectors in the Romanian economy: it contributes around 13% to 
GDP2, and employs  31% of the labour force (down from 41.2% in 1999). Foreign investment in 
agriculture represented 12% of Romania's total fo reign investment inflows over 1991-04. In 2003, 
crops contributed 64.1% of total agricultural pr oduction, followed by livestock (34.9%), and 
agricultural services (1%). The main crops are cerea ls (maize, wheat, and barley), and fruit and 
vegetables (e.g. grapes, potatoes).  Livestock produc tion consists of poultry,  sheep, pigs, and cattle. 
Romania also has one of the largest areas of undistu rbed forests in Europe. Timber provides the basis 
for lumber, paper, and the export-oriented furniture industry. 
                                                      
1 HS 330210.10. 
2 In addition, the fo od industry accounted for abou t 13% of total industrial  output in 2004, and for 
10.2% of industrial employment.  Romania WT/TPR/S/155/Rev.1 
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6. The State has almost completed the restitution of both agricultural and forestry land.3 
According to the authorities, by the end of May 2005, 92.3% of the land claimed (12.4 million 
hectares) was back in private hands.  Agricultura l land covers some 14.7 million hectares, of which 
63.5% is arable, 23.1% is pasture, 10.2% hayfield s, and the remainder are vineyards, orchards, and 
nurseries. In addition, forests account for 6.22 milli on hectares (26.1% of the total area of Romania), 
and are located mainly in the Carp athian mountains and its foothills . About two thirds of the rural 
population in Romania depend on income from subs istence and semi-subsistence farms;  most 
agricultural land is taken up by these farms. 
7. Romania is a net importer of fishery products.4  Its production declined from a peak of 
63,497 tonnes in 1990 to 16,232 tonnes in 2003, main ly because of the dismantling of the fishing 
fleet, low productivity, high production costs, pollu tion, and inefficient management of resources. 
Production comes largely from inland fishing (7,000 s quare km, or 3% of Romania's territory), the 
Black Sea, and aquaculture. The main varieties are sturgeon species, sprat, and carp. Although 60% of 
fish farm management is private, the ca pital is still owned mostly by the State.5 
(ii) Policy developments 
8. The Ministry of Agriculture, Forests, and Rural Development (MAFRD) has responsibility 
for the sector, including fisheries.6 Romania's main policy objectives for agriculture are food security 
and self-sufficiency, without disturbing rural area s, and while continuing preparations for EC 
accession. To achieve this , in April 2004, the MAFRD set up a Strategy for the Sustainable 
Development of Agriculture and the Food Industry for 2004-25, aimed at, inter alia : raising 
productivity, quality, and competitiveness so as to be ready for EC membership; completing the 
privatization of state farms7; promoting rural development; and tr ansforming small-scale agricultural 
farms into viable holdings.8 
9. Romania's policies of aid and support to agri culture comprise various schemes, some of 
which are based on vouchers given to farmer s, on a per hectare basis, to purchase inputs 
(e.g. chemical fertilizer9) or services at market prices.10 To promote the modernization of the sector, 
                                                      
3 In 1991, Romania initiated a process of restitution, i.e.  the return of state-appropriated property to pre-
communist owners or their heirs. To this effect, new laws have been passed to provide the framework for 
private-sector development in agriculture. 
4 In 2002, Romania imported 50,060 tonnes of fish, seafood, and prepared fish, compared with exports 
of 125 tonnes (Romanian Statistical Yearbook, 2004). 
5 Eurofish Magazine online information.  Available at: http://www.eurofish.dk.  
6 On the basis of Government Decision No. 409/2004, the MAFRD is now in charge of rural 
development. The MAFRD was formerly the Ministry of Food and Agriculture, which later became the Ministry 
of Agriculture, Forests, Waters, and Environment. The legal institutional framework is Government Decision 
No. 155/2005, modified and completed by Government Decision No. 374/2005. 
7 The privatization of state-owned farms (SOFs) is almost complete in legal terms since there are no 
more companies to be sold. By mid-2004, of the 739 SOFs in the State Domain Agency portfolio, 281 had been 
privatized, eight were in the final stages of privatization, 360 had been declared bankrupt and were under 
liquidation, and 90 in 2004 b ecause privatization had failed tw ice (European Commission, 2004c). 
8 The extreme fragmentation of farm structures in Ro mania has been a key problem in the sector;  most 
farms are, on average, only 2 hect ares (Romanian Forum online information.  Available at: www.romanian.eu. 
com/Romania/sectors6.htm). 
9 On the basis of Government Ordinance No. 158/2002, 100 kg/ha of chemical fertilizer is given to 
agricultural producers that meet specified criteria. 
10 All agricultural prices have been liberalized, in cluding minimum and maximum prices at the output 
and input levels, as well as prices at the wholesale an d retail levels. Romania's transformation towards reliance WT/TPR/S/155/Rev.1 Trade Policy Review 
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the Government pays 45-55% of the purchase price of  tractors and other equipment, and 50-70% of 
the purchase price of irrigation installations. State budget support for the sector in 2004 was RON 2,070 million (up from RON 360 million in 1999); about two thirds went to crops, and the 
remainder to livestock.  In July 2004, a furt her RON 85 million was allocated to supplement the 
budget for direct payments for small-scale farmer s. External aid of RON 1,700 million complements 
domestic support; the major share is under the EC's Special pre-Accession Programme for Agriculture 
and Rural Development (SAPARD).
11 
10. According to Romania's latest notification to the WTO Committee on Agriculture, in 2002, its 
Aggregate Measurement of Support (AMS) amounted to RON 230 million (down from 
RON 240 million in 1999). In terms of products, the largest share of AMS expenditure, in 2002, was 
devoted to milk (41.5%), live poultry (15.6%), wheat (15%), and live swine (12.2%). Domestic green box support reached RON 460 million in 2002 (up from RON 150 million in 1999); about half of 
green box expenditure was allocated to land reclam ation, maintenance of irrigation and drainage 
systems, and electric power.  Seeds price subsidies to farmers accounted for 21.1%, and parasites and 
epizootic control for 14.9%;  direct payments to pr oducers, introduced in 2002 to stimulate livestock 
production, represented 2.5% of total green box measures.
12  According to the authorities, no direct 
payments were given to stimulate livestock pr oduction in 2003 and 2004, except for selection and 
animal reproduction purposes. 
11. In the Uruguay Round, Romania bound its AMS at the 10% de minimis  level, for which no 
reduction commitments were required.13 During the period under Review, some Members raised 
concerns, in the WTO Committee on Agriculture , about Romania's green box and amber box 
measures.14 Regarding agricultural export subsidies, acco rding to Romania's most recent notification 
to the WTO Committee on Agriculture, products subject to reduction commitments (i.e. cereals, 
oilseeds, sugar, cheese, beef meat, eggs, wine an d spirits, fruits, and vegetables) received no export 
subsidies during 2001-02; Romania granted expor t subsidies for cereals (RON 9.9 million). 
According to the authorities, no export subsidi es were granted in 2003;  export subsidies were 
allocated for wines (RON 60,000) in 2004. 
12. According to OECD, Romania's producer subs idy equivalents (PSEs), rose from 20% in 1999 
to an estimated 24% in 2001; while the implicit tax on consumers, as measured by the consumer 
subsidy equivalents (CSEs) declined fro m -21% to -22% over the same period.15 The PSEs for 
Romania's main products show that sugar, milk, pou ltry, eggs, and wheat were the major beneficiaries 
in 2001. The OECD also estimates that total support to agriculture (TSE), as a percentage of GDP, 
                                                                                                                                                                     
on market signals for producer and co nsumer choices, as well as more transparent forms of assistance, is 
described in WTO (2000).   
11 In 2004, Romania was eligible to receive € 158.7 million through th e EC's SAPARD support 
programme for agricultural and rural development (European Commission, 2004c). 
12 WTO documents G/AG/ROM/20, 21 October 2003, and G/AG/ROM/20/Corr.1, 15 December 2003. 
 13 WTO document G/AG/R/37, 18 December 2003. 
 14 WTO documents G/AG/R/27, 14 September 2001; and G/AG/R/38, 28 May 2004. 
 15 The PSE captures the annual valu e of transfers under agricultural po licies, as percentages of total 
production value. Its estimate includes transfers from both consumers of agricultural products (through domestic 
market price support) and taxpayers (through budgetary or tax expenditures) to agricultural producers. The CSE indicates the annual value of money transfers to consum ers under agricultural policies. When negative, the CSE 
measures the implicit tax imposed on consumers by agricultural policy. The ma jor component is market 
transfers due to market price support to production; it also includes other transfers such as subsidies to 
consumers from government budgets (OECD, 2002). Romania WT/TPR/S/155/Rev.1 
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went up from 5.2% in 1999 to 6.1% in 2001.16  According to the authorities, the domestic support 
measures during 2002-05 are:  a programme for small exploitations under 5 ha.;  a diesel oil 
acquisition programme;  support for th e vegetal subsector;  land reclamation;  a seeds subsidy;  and a 
milk premium. 
13. In preparation for its accession to the EC, Romania is in the process of adopting all the 
elements of the Common Agricultural Policy (CAP ), including the Common Market Organizations 
(CMOs).17 According to the EC, in July 2004, Romania transposed the main elements of the EC's 
CMO for cereals, as well as the marketing standards for some fruits and vegetables. Legislation on 
animal products has been further aligned on the EC 's, notably provisions on marketing standards for 
eggs, pork meat, milk, dairy products, and on carca ss classification system for bovines, pigs, and 
sheep.18  In its negotiations with the EC, Romania ha s been granted some transitional arrangements: 
direct payments will be phased in at 25% of the EC 's direct payments level in 2007, 30% in 2008, 
35% in 2009, and 40% in 2010, and thereafter increased by 10% increments to reach 100% of 
the EC level applicable in 2016;  and a numbe r of derogations to the rural development acquis  over 
2007-09.19  
14. MFN tariffs on agricultural products (ISIC (Revisi on 2) definition) average 16.2%, with rates 
ranging up to 100% on some fruits and vegetables. During the Uruguay Round,  Romania committed 
to establishing the current minimum access tariff quotas on imports of 12 agricultural product categories during 1995-04:  meat and edible offal of pork;  meat and edible offal of bovines;  powder 
milk;  cheese;  potatoes for seeding;  chocolate;  ot her pasta;  ice-cream;  beer;  vermouth;  ethyl 
alcohol;  and cigarettes.  However, as Romania's a pplied MFN tariffs are lowe r than even its in-quota 
tariff, its MFN tariff quotas do not currently apply. 
15. The limited coverage of agricultural products in Romania's preferential trade agreements 
delays their exposure to greater competition: sel ected agricultural products are duty-free or carry 
reduced duty rates, often under tariff quotas (Chapter III(2)(iv)(c)). 
16. Agricultural products subject to compulsory reser ve stocks are managed by the National State 
Reserve Agency. 
(iii) Selected products 
(a) Cereals 
17. On an acreage basis, cereals are Romania's most important crop, accounting for 70.5% of 
arable land (Table IV.1). Major cereals-producing c ounties are to the south and west of Romania.  
Production is concentrated in maize (52.3% of acr eage planted with cereals), and wheat (36.6%). 
                                                     
 
16 TSE is an indicator of the monetary value of all gross transfers from taxpayers and consumers arising 
from policy measures that support ag riculture, net of the associated budget ary receipts. When expressed as a 
percentage of GDP, it gives an indication of the burden this overall support represents for the economy. 
17 The CMOs of the EC can be for: (i) arable crop s (e.g. cereals, oilseeds), beef and sheepmeat, with 
direct aid to producers linked to factors of production, such as land or livestock, subject to reference periods and 
production-limiting programmes; (ii) oliv e oil, tobacco, cotton, certain proce ssed fruit and vegetables (e.g. citrus 
fruit, tomatoes, and table wine), with direct aid propor tional to production levels, but also subject to ceilings 
based on historical production levels ; (iii) dairy products and sugar, with  support within production quotas, 
whose cost is mainly borne by the consumer; and (iv) fruit and vegetables, quality wines, pigmeat, poultry meat, 
eggs, and honey, with possibility for the market to fl uctuate with a minimum of intervention (WTO, 2004b).  
18 The legislation on a classification system for pigs entered into force on 1 July 2005, while the 
classification for bovines and shee p is expected by 1 July 2006. 
19 European Commission (2005). WT/TPR/S/155/Rev.1 Trade Policy Review 
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Romania has consolidated its positio n as a net exporter of cereals in the last few years, reflecting a 
significant increase both in production and yield of most crops, notably maize.  Production of maize 
and sorghum went from 10.9 million tonnes in 1999 to 14.6 million tonnes in 2004, while the yield 
jumped from 3.6 tonnes/hectare to 4.4 tonnes/hectare.  Production of wheat, barley, and two-row 
barley also reached record levels in 2004,  partly due to favourable weather conditions. 
Table IV.1 
Production of main crops, 1999-04 
 1999 2000 2001 2002 2003 2004 
Cereals 
  Cultivated area ('000 ha) 
  Total production ('000 tonnes)  
5,370.7 
17,037.3  
5,655.2 
10,477.5  
6,294.9 
18,870.9  
6,038.1 
14,356.5  
5,541.8 
12,964.4 6,265.4
24,403.0 
Wheat and rye 
  Cultivated area ('000 ha) 
  Average yield (kg./ha) 
  Total production ('000 tonnes)  
1,686.9 
2,776 
4,682.5  
1,954.3 
2,280 
4,456.2  
2,558.6 
3,034 
7,763.8  
2,309.8 
1,923 
4,441.1  
1,748.0 
1,428 
2,496.4 2,317.8
3,394
7,867.4 
Barley 
  Cultivated area ('000 ha) 
  Average yield (kg./ha)   Total production ('000 tonnes)  
216.0 
2,890 624.4  
214.6 
2,612 560.6  
316.7 
3,335 1,056  
301.4 
2,202 663.9  
120.2 
1,966 236.2 248.2
3,737927.4 
Two-row barley  
  Cultivated area ('000 ha) 
  Average yield (kg./ha) 
  Total production ('000 tonnes)   
199.5 1,976 
394.2  
197.3 1,553 
306.4  
212.1 2,470 
524.0  
277.3 1,790 
496.5  
209.4 1,455 
304.7 176.3
2,714
478.6 
Oats  
  Cultivated area ('000 ha) 
  Average yield (kg./ha) 
  Total production ('000 tonnes)   
248.2 
1,570 
389.6  
232.3 
1,050 
243.8  
219.4 
1,743 
382.4  
239.4 
1,368 
327.4  
242,3 
1,334 
323.1 207.5
2,154
447.1 
Maize and sorghum  
  Cultivated area ('000 ha) 
  Average yield (kg./ha)   Total production ('000 tonnes)   
3,051.1 
3,626 
10,937.4  
3,051.0 
1,603 
4,899.1  
2,980.2 
3,062 
9,124.7  
2,897.3 
2,900 
8,402.4  
3,206.5 
2,988 
9,582.0 3,283.0
4,438
14,570.0 
Sunflower  
  Cultivated area ('000 ha) 
  Average yield (kg./ha)   Total production ('000 tonnes)   
1,043.0 
1,243 
1,300.9  
876.8 
821 
720.9  
800.3 1,029 823.5  
906.2 1,105 
1,002.8  
1,188.0 
1,268 
1,506.4 977.0
1,595
1,557.8 
Soyabeans  
  Cultivated area ('000 ha) 
  Average yield (kg./ha) 
  Total production ('000 tonnes)   
99.8 
1,838 
183.4  
117.0 
594 
69.5  
44.8 
1,623 
72.7  
71.8 
2,033 
145.9  
128.8 1,746 
224.9 121.3
2,462
298.5 
Sugar beet  
  Cultivated area ('000 ha) 
  Average yield (kg./ha) 
  Total production ('000 tonnes)   
65.5 
21,608 
1,414.9  
48.4 
13,787 
666.9  
39.0 
22,432 
875.5  
41.6 
22,930 
954.6  
45.2 
16,916 
764.5 20.8
32,290
672.7 
Tobacco  
  Cultivated area ('000 ha) 
  Average yield (kg./ha)   Total production ('000 tonnes)   
10.9 
1,349 
14.8  
11.3 
965 
10.9  
9.2 
1,094 
10.1  
9.1 
1,764 
16.0  
7.6 
1,038 
7.9 5.9
1,268
7.5 
Field vegetables  
  Cultivated area ('000 ha) 
  Average yield (kg./ha) 
  Total production ('000 tonnes)   
233.1 
12,852 
2,995.9  
234.0 
10,251 
2,477.6  
228.6 
12,178 
2,826.3  
237.4 
11,560 
2,806.7  
242.2 
13,076 
3,300.8 221.8
16,463
3,651.7 
Grapes  
  Cultivated area ('000 ha) 
  Average yield (kg./ha) 
  Total production ('000 tonnes)   
251.1 
4,429 
1,117.2  
247.5 
5,212 
1,295.3  
244.4 
4,568 
1,121.7  
242.9 
4,414 
1,076.7  
233.3 
4,591 
1,078.0 205.4
5,990
1,230.4 
Source : Information provided by the Romanian authorities. 
18. During 1999-04, producers of cereals receive d government assistance of RON 4,670 million 
for the following schemes:  supporting the autumn a nd spring crops (51%);  subsidizing electrical 
energy, water, and irrigation systems (17.7%);  subsidizing acquisition of agricultural machinery Romania WT/TPR/S/155/Rev.1 
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(6.6%);  price reductions to stimulate the use of hi gh quality seeds (9.6%);  direct payments (6.4%);  
purchasing chemical fertilizer (4.2%);  compensa ting disasters and subsidizing insurance premiums 
(2.9%);  buying diesel (0.9%);  and subsidiz ing credits (0.6%).  Moreover, over 1999-02, 
RON 90.85 million were granted to sustaining phyt osanitary treatments. MFN tariffs on cereals 
average 14.2%, with rates ranging up to 30% on maize and other seeds. 
(b) Wine 19. In 2004, Romania's vine area was 192,000 ha (93% wine grapes, and 7% table grapes), 
located mainly in the eastern and southern Carpathian  region, in the Transylvanian plateau, and in the 
west of the country. During 1999-04, annual produc tion averaged 5.5 million hectolitres, of which 
375,000 hectolitres were exported, main ly to Moldova and EC countries.
20 Wine is subject to an 
applied MFN tariff rate of 60% (com pared with a bound rate of 315%). 
20. Romania grants financial support to wine producers for, inter alia : purchasing vine material; 
updating the Vineyards Register; strengthening the administrative capacity in the subsector; and 
improving control and hygiene. In 2004, export su bsidies of RON 60,000 were allocated to wines  
(Chapter III(3)(iv)). 
(c) Livestock 
21. Livestock production in Romania increas ed from RON 4,390 million in 1999 to 
RON 16,050 million in 2004, largely as a result of the national livestock recovery programme 
implemented since 2001. In terms of head units, poultry accounts for over 80% of total livestock, 
followed by sheep and goats (8%), pigs (6%), a nd cattle (3%). The private sector has increased its 
participation in the subsector significantly over the last few years, and now owns 98-100% of 
Romania's livestock.  Romania continues to apply an  import ban on certain live animals as a result of 
foot-and-mouth-disease. In addition, in 2004, a temp orary suspension of imports of live poultry and 
domestic live birds was introduced – and still appli es – because of the outbreak of highly pathogenic 
avian influenza (Chapter III(2)(vii)(d)). 
22. During 1999-04, livestock producers received government assistance of RON 1,250 million 
for the following schemes:  milk premium (35.9%); production support (35.8%);  sanitary-veterinary 
actions (22.1%);  genetic fund (3.2%); fund for ge netic horse breeding (1.6%);  and seminal material 
(1.4%).  MFN tariffs on meat products average 31%,  with rates ranging up to 45% on products such 
as meat of swine, and edible meat offal, while tariffs on dairy products average 39.4%. 
(d) Fisheries 
23. According to the National Strategy for Fisher y, Romania aims to increase annual fisheries 
production to 23,000 tonnes by 2007: 60% from sea and inland fishing, and 40% from aquaculture. To this end, Romania is implementing various measures,  such as promoting the modernization of vessels, 
fish farms, and harbours; and diversifying cultivated  species. The lack of infrastructure to manage 
ports is one of the main problems facing the subsect or. Romania is bringing its legislation, notably 
Fishery Law No. 192/2001, in line with the EC's Common Fisheries Policy (CFP).  MFN tariffs on 
fisheries average 19.6%, with rates ra nging up to 25% mainly on live fish. 
24. The National Agency for Fisheries and Aqu aculture (NAFA) is responsible for the 
administration of fisheries resources;  exploitation is managed through:  the National Company of 
                                                     
 
20 Romania is the fifth largest vine growing country, and the sixth largest wine and grape producer in 
Europe.  WT/TPR/S/155/Rev.1 Trade Policy Review 
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Fisheries Resources (NCFR)21; the Danube Delta Biosphere Reserve Administration (DDBRA)22; and 
the National Forest Administration (NFA), in charge of controlling fisheries in mountain waters and of trout farming. NAFA issues the licences for these three managers, with the latter being in charge of authorizations of recreational/sportive fishing.   The NAFA also issues aquaculture licences. 
25. All commercial fishing vessels have to be recorded  in the Fishing Vessel Register as the first 
condition for obtaining a fishing licence and quot as.  The allocation of quotas has been based 
primarily on historical catch rates, but fishing quot as are now being allocated within the limit of the 
Total Allowable Catch (TAC), based on research studies.
23 
26. State aid to the subsector has been reduced ove r the last few years.  The reimbursement of 
55% of locally produced equipment purchased by fi shermen and their organizations located in the 
Danube Delta was eliminated in 2004, as was the exemption from VAT and excise duties for fuel used by Black Sea vessels.  Nevertheless, a genera l customs duty exemption applies in specified cases 
(Chapter III(2)(iv)(e)).  In 2004, state aid amounted  to RON 200,000, mainly to preserve and improve 
the genetic heritage, including for freshwater fish.  In addition, the EC granted €860 million to support 
Romania's fisheries in 2004.
24 
(e) Forestry 
27. The composition of Romania's forests is varied:  conifers make up around 30%;  beech, 30%;  
oak species, 17.8%;  and various broad-leaves species 22.2%.25  In 2003, Romania's harvested wood 
volume was 16,692 billion cubic meters (an increa se of 17.8% over 1999).  Imports of wood and 
articles thereof, excluding furniture, rose from €342 million in 1999 to €709 million in 2003, and 
exports increased from €64 million to €180 million. The  MFN tariffs on forestry products average 
4.8%, with rates ranging up to 5%. 
28. On the basis of the Forestry Law No. 68/1996 (as amended), state-owned forests are managed 
by the National Forest Administration under the MAFRD26; private forests are managed by the 
owners themselves on the basis of local management plans.  A forest management plan is drawn up 
for a period of ten years (every five years for popl ar and willow forests) for each production unit of 
local forest districts. In order to improve the overall management of Romania's forestry land, a 
national forestry cadastre system is being developed. To protect Romania's virgin forests from degradation, the National Forest Administration sets annual ceilings for cut wood production, and 
allocates the resulting quotas to economic agents on the basis of auctions. Moreover, accessibility to 
forestry resources has improved over the last fe w years through the development of the roads 
network.  
                                                     
 
21 The NCFR, established in 2002, is a public institution responsible for fisheries issues in the Black 
Sea, as well as the Danube River and inland waters, excluding the Danube Delta Biosphere Reserve and the 
mountain waters. 
22 The DDBRA, a public institution under the Ministry of Waters and Environment Protection, is 
responsible for waters of the Reserve area. The Danube Delta Biosphere Reserve is one of Europe's most 
extensive wetlands that is still in a natural state. 
23 Black Sea production is estimated to reach 10,700 tonnes by 2006, through the modernization of the 
fishing fleet (FAO online information.  Availabl e at: http://www.fao.org/f i/fcp/en/ROM/body.htm). 
24 European Commission (2004c). 
25 Romanian Statistical Yearbook (2004). 
26 The National Forest Administration is organized into three administrative levels:  the centre, headed 
by a general manger;  41 county branches plus the Institute of Forest Research and Management (ICAS);  and 349 forest districts, managi ng 10,000 to 25,000 ha each. Romania WT/TPR/S/155/Rev.1 
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29. Under the Forestry Law, a special fund for fo rest conservation and regeneration was created 
in 1996.  In order to support private forest ownership, and ensure the integrity of forests and their 
sustainable management, Ordinance No. 96/1998 pr ovides for an annual allocation of funds by the 
State to, inter alia : reconstruct forests affected by natural di sasters, and forest roads; control forest 
pests; and finance expenditures necessary to regenerate forests.  In 2002, the World Bank granted a 
US$25 million loan to help Romania to sustain and manage its forests.27  
(3) MINING AND ENERGY  
(i) Overview 
30. Romania is a mineral rich country, with the la rgest production of crude oil and natural gas in 
Central and Eastern Europe.28 Moreover, Romania is the fifth and ninth largest European producer of 
bauxite and aluminium, respectively; it has significant reserves of coal, and is a leading producer of electricity in the region.
29 However, arrears in mining and energy impose a big burden on the budget 
(almost 10% of GDP in 2003 (Chapter I(1))).30  Romania produces about half of its total primary 
energy needs, and imports the rest;  it continues to suffer from low energy efficiency.  As a result, and 
in preparation for EC integration, the sector is being restructured to give private enterprises an 
increasingly important role. 
31. There have been some major changes to the le gislative framework for the mining and energy 
sector since Romania's last TPR, including the Mining Law (No. 85/2003), the Petroleum Law (No. 238/2004), the Gas Law (No. 351/2004), and the Electricity Law (No. 318/2003). In addition, 
new regulatory bodies have been established: the National Regulatory Authority for Natural Gas 
(ANRGN), the Energy Regulatory Authority (ANRE) , the Agency for Energy Conservation (ARCE), 
and the Nuclear Regulatory Authority (CNCAN).  Po licy issues related to mining and energy are still 
the responsibility of the Ministry of Economy and Commerce (MEC), while the Office of State Ownership and Privatization in Industry (OPSPI) is now responsible for the privatization of energy-
related SOEs.  The number of public institutions  engaged in mining and energy activities causes 
inefficient coordination within the sector and delays its restructuring. 
32. MFN tariffs average 5.2% in mining and quarr ying (major division 2 of ISIC, Revision 2), 
and range from zero on asbestos, ores and concentrates,  coal, lignite, and crude petroleum, to 15% on 
petroleum gases and other gaseous hydrocarbons.  Imports  of electricity are subject to a tariff rate of 
6%. 
(ii) Mining 
33. In April 2004, Romania adopted the Mining Industry Strategy for 2004-10 aimed at  
rehabilitating, upgrading, and priva tizing viable mines; encouragi ng foreign investment; protecting 
environmental standards; and mitigating the social consequences of the closure of non-viable mines. 
The National Agency for Mineral Resources (NAMR) , established in 1993, continues to be the 
regulatory authority for mineral a nd petroleum resources, while the National Agency for Development 
and Rehabilitation Programmes for Mining Areas is in char ge of the social aspects of the restructuring 
programme. 
                                                     
 
27 The loan is to be paid back in 17 years, with  a five-year grace period.  The Romanian Government 
will contribute US$2.3 million to the project, and US $4.6 million will come from private investors (Forest 
Conservation Portal online information.  Available a t: http://forests.org/article s/print.asp?linkid=18764). 
28 Romania also has the largest refining industry in the region, exporting several petrochemicals.  
29 Romania Factbook 2005 online information.  Available at: www.factbook.net/aluminium.php. 
30 IMF (2004c). WT/TPR/S/155/Rev.1 Trade Policy Review 
Page 68 
 
 
34. In line with Romania's EC commitments, the st rategy also includes the phasing out of state 
subsidies and transfers for coal by 2010, and for the other minerals by 2007; employment in the 
subsector will be reduced by over 40% by 2007.31 
35. Article 135 of the 1991 Constitution establishes that subsoil resources of any nature are public 
property. The 2003 Mining Law regulates mining activities in Romania. Two licences are required for 
mining activities (exploration and exploitation), while  for petroleum products one licence covers both 
exploration and exploita tion. The licences are granted by the NAMR, to Romanian or foreign 
investors, for a period of 20 years, renewable for successive periods of five years. The holder of a licence must inform the NAMR about its operati ons and results; protect and rehabilitate the 
environment; pay annual taxes on per square km basis (RON 2.5 for prospecting activity; RON 10 for 
exploration; and RON 2,500 for exploitation)
32;  and pay mining royalties.33  
(iii) Energy 
(a) Policy developments 
36. In 2003, Romania adopted the National Strategy for the Development of Energy during  
2004-15.  It is aimed at, inter alia , completing the liberalization of the market in time for Romania's 
accession to the EC; restructuring the subsector, while ensuring power needs at lower prices; 
diversifying energy sources and creating new infrastructures; protecting the environment; and improving the security of energy supply.
34  According to the strategy, the share of renewable energy 
sources in Romania's energy generation should reach  33% by 2010, compared with 28% at present. 
The evolution of Romania's energy exports and im ports during 1999-04 is described in Table IV.2. 
37. Since its last TPR, Romania has privatized sev eral energy-related SOEs, notably the national 
oil monopoly (Petrom), two major gas distribution co mpanies (Distrigaz Sud and Distrigaz Nord), and 
two electricity distributors (Electrica Banat and Dobr ogea);  the privatization of other SOEs is being 
prepared, including gas distribution companies, el ectricity distributors, and a number of power/heat 
producers and small hydropower plants (Chapter III(4)(ii)). Romania has also made further progress towards the elimination of energy price distortions:  as from 1 January 2005, the end-user prices of, 
inter alia , gas, electricity, and heating were increased, with a view to setting them at cost-recovery 
levels (including capital return). The gas and electri city price adjustments are expected to increase 
savings relative to GDP by 1.1 percentage point. In a ddition, delivery of fuel by SOEs to inefficient 
heating plants is being phased out.
35 
38. Romania is increasing its role as a transit count ry for gas from the Russian Federation, the 
Caspian Sea region, and the Middle East, including through the Constanta-Omisalj oil pipeline (on the 
Adriatic coast), and the Nabuco gas pipeline with Au stria, Bulgaria, Hungary, and Turkey. Romania is 
                                                      
31 The World Bank is to provide support for social mitigation schemes in the affected regions 
(IMF, 2004). 
32 These taxes are updated annually through a Government Decision on the basis of a proposal by 
NAMR, taking into account the inflation rate. 
33 The mining royalty is a quota of between 2% and 10% of the production value; it is paid every 
trimester, from the day production started, until the 20th day of the first month of the following trimester. 
34 Romania increased its oil stocks from 56 days of annual consumption in 2003 to 60 days in 2004. In 
its negotiations with the EC, Romania has been granted un til the end of 2011 to raise its oil stocks to 90 days 
(European Commission, 2004c). 
35 IMF (2004b). Romania WT/TPR/S/155/Rev.1 
 Page 69 
 
 
also due to participate in the creation of an Energy Community in South-East Europe, aimed at 
improving the interconnection of electricity and gas.36 
Table IV.2 
Energy exports and imports, 1999-04 
 Natural gas 
(tera jouli) Electric power 
('000 kWh) Mineral fuel 
('000 tonnes) Crude petroleum 
('000 tonnes) Petroleum products 
('000 tonnes) 
 Quantity Value Quantity Value Quantity Value Quantity Value Quantity Value Total 
1999 
  Exports f.o.b.   Imports c.i.f.  
.. 
121,712  
.. 
198.6  
2,237 1,412 72.6
46.1 291
2,730 21.2
161.5 ..
4,294 ..
478.2  
1,957 1,513  
320,489 166,842  
414.2 
1,051.2 
2000   Exports f.o.b.   Imports c.i.f.  
.. 
122,508  
.. 
326.2  
1,530 
836 46.7
25.1 245
3,205 36.5
525.6 ..
4,642 ..
822.5  
2,520 1,215  
659,570 210,085  
742.8 
1,583.3 
2001   Exports f.o.b.   Imports c.i.f.  
.. 
108,882  
.. 
351.3  
2,077 
767 62.3
23.0 225
3,971 36.5
284.8 ..
5,544 ..
954.2  
2,852 2,372  
608,337 357,133  
707.1 
1,970.5 
2002   Exports f.o.b.   Imports c.i.f.  
.. 
145,601  
.. 
411.5  
3,290 
435 100.5
12.1 222
4,541 40.8
262.6 ..
5,691 ..
1,065.6  
4,405 1,537  
959,765 240,499  
1,101.1 1,992.3 
2003   Exports f.o.b.   Imports c.i.f.  
.. 
226,681  
.. 
799.3  
3,046 
962 79.2
29.0 190
4,716 41.7
355.8 ..
5,217 ..
1,087.7  
3,606 1,578  
1,023,382 
347,447  
1,144.3 2,619.3 
2004   Exports f.o.b.   Imports c.i.f.  
.. 
194,589  
.. 
755.1  
3,766 2,584 98.3
93.6 305
5,587 73.9
755.6 ..
7,314 ..
1,980.0  
4,171 1,320  
1,415.580 
362,284  
1,587.8 3,884.6 
.. Not available. 
Note: Value = US$ million. 
Source:  IMF (2004), Romania:  Selected Issu es and Statistical Appendix , Washington D.C.;  and information provided by 
 the Romanian authorities.  
(b) Policy by type of product 
Oil and natural gas 
39. Romania is a net importer of crude oil and na tural gas, largely because its oil production 
plummeted from a peak of 294,000 barrels per day (bpd) in 1976 to 124,500 bpd in 2002, and its 
natural gas production fell from a peak of 1.4 trillio n cubic feet (tcf) in 1983 to 0.5 tcf in 2000.37 Two 
major companies operate in the subsector, Petr om and the main natural gas extraction company 
(Romgaz). The vertically integrated Petrom is res ponsible for about 10% of Romania's GDP, and is a 
major contributor to the state budget.38 The restructuring of Romgaz began in 2000, and it is expected 
to be privatized by mid 2006.39 All companies are eligible to import crude oil, but only four actually 
import it. Transport of petroleum products is undertaken by two companies, through 4,500 km of 
pipeline. 
40. According to the 2004 Petroleum Law (repl acing Petroleum Law No. 134/1995), companies, 
whether foreign or local, may only conduct petrol eum operations on the basis of concessions granted 
                                                      
36 European Commission (2004c). 
37 Romania's consumption of both crude oil and natural gas also declined significantly during its 
transition to a market economy (Alexander's Gas & Oil Connections online information.  Available at: http://www.gasandoil.com/goc/news/nte30277.htm). 
38 Petrom annually extracts about 6 million tonnes (mt)  of crude oil, 6.1 billion cubic meters (bcm) of 
natural gas, and produces some 96,000 tonnes of gasoline, and 47,000 tonnes of ethane. It also has a refining capacity of 14 mt of crude oil annually. Petrom also owns 690 retail stations, and has branches and subsidiaries 
in several countries (Petrom on line information.  Available a t: http://www.petrom.ro/engleza/ 
en_organizare.htm). 
39 In 2001, Ruhrgas (Germany) became the first foreig n company to invest in Romania's natural gas. WT/TPR/S/155/Rev.1 Trade Policy Review 
Page 70 
 
 
by the NAMR. The initial term of the concession may not exceed 30 years, renewable for up to 
15 years.40 The holder of the concession must inform the NAMR about its ope rations and results; 
protect and rehabilitate the environment; bear costs related to transfer of technology and professional 
training; pay profit taxes; and pay the petroleum royalty (Article 49).41 Investment incentives 
available for petroleum and natural gas activiti es include: state aid (RON 45.5 million during 2001-
03); and the right to retain the currency obtained  from exports, and to deposit this abroad, after 
payment of taxes.42  
41. The 2004 Gas Law regulates natural gas activities in Romania, including the role of the 
ANRGN (established in 2000), licensing, and author izations. Some of the main objectives of the 
ANRGN are:  to promote competition in the subsector, through, inter alia , the adoption of a viable 
tariff policy for natural gas;  and to complete the lib eralization of the subsector in time for Romania's 
accession to the EC.43 
42. The price of crude oil to producers is set by the NAMR:  a reference price, determined with 
respect to world prices, is used to calculate the royalty to be paid by producers of crude oil and 
petroleum;  producers are free to set their sales pric es. Prices for about 50% of domestic consumption 
of natural gas is regulated by the ANRGN;  industr ies are allowed to choose their suppliers (domestic 
and foreign). According to the authorities, the natural gas market will be fully open by 2007. 
Petroleum products and gas are subject to customs duties (if imported), and the excise tax.  In its 
negotiations with the EC, Romania was grante d a transitional arrangement until 31 December 2011 
for the building up of minimum stocks of crude oil and/or petroleum products.44  
Electricity 
43. Romania is a net exporter of electricity;  net exports (exports minus imports) averaged about 
1,500 gigawatt hours (GWh) annually during 1999- 04. Romania's total electricity production 
increased from 50,713 GWh in 1999 to 56,645 GWh in  2003, but is still well below the 1989 level 
(83,400 GWh), mainly due to a reduction in industrial  consumption.  In 2004, coal contributed 39% to 
electricity generation, followed by hydro-power plants (29%), hydrocarbons (22%), and nuclear 
(10%). Electricity consumption in Romania is e xpected to increase by 2.5% per year until 2025.45 
44. In July 2000, Conel, Romania's national electri city company, was split into five independent 
state-owned companies: Transelectrica (electricity transport)46; Termoelectrica (production and 
supply); Hidroelectrica (production); Electrica (d istribution); and Nuclearelectrica (operates the 
Cernavoda nuclear plant).47  By 1 July 2005, 83.5% of the electricity market was considered open (up 
                                                      
40 Exploration works can also be conducted solely on the basis of non-exclusive prospecting permits 
issued by the NAMR. The prospecting permit is gran ted for a maximum of thre e years, non-renewable. 
41 The petroleum royalty is in the form of a quota of between 3.5% and 13.5% (up to 13% in the case of 
natural gas) of the gross production value; it is paid quarterly, from the day production started, to the 25th day of 
the first month of the following quarter. A 5% quota of the value of gross income from petroleum operations also applies for using Romania's petroleum transport systems or petroleum terminals owned by the State.  
42 Chamber of Commerce and Industry of Romania and Bu charest (2004). 
43 Romania's natural gas market was estimated to be 40% open in 2004 (ANRGN, 2004). 
44 European Commission (2005). 
45 Romanian Energy Regulatory Authority (2003). 
46 Transelectrica is also the sole shareholder of Op com, the electricity market operator. Transelectrica 
plans to become a large regional electricity exporter, targeting neighbouring countries that are electricity 
importers. 
47 The nuclear plant at Cernavoda has a net capacity of 655 MW. It is currently being improved and 
safety-upgraded. In order to strengthen nuclear energy resources, the taxes and tariffs charged for nuclear 
activities, and contributions from licence holders to CN CAN, were increased in 2004 (European Commission, 
2004c). Romania WT/TPR/S/155/Rev.1 
 Page 71 
 
 
from 8% in 2000, and 55% at the end of 2004); a ll non-householders are now free to choose their 
supplier. According to the authorities, the electricity  market will be 100% free by July in 2007 (i.e. all 
consumers will be free to choose their suppliers). 
45. The 2003 Electricity Law redefined the development of the subsector, 80 years after the first 
electricity law was issued in Romania.  It included the separation of generation, transmission, and distribution/supply segments of the market; its gra dual liberalization; the promotion of renewable 
energy resources; the tariff principles; and th e tasks and competences of the ANRE, notably 
increasing electricity market efficiency.
48  Participation in the electricity subsector is by licence 
granted by the ANRE (to Romanian or foreign investors).  Licence periods are:  eight years maximum for electricity supply, and 25 years maximum for generation, transmission, ancillary services, 
distribution, and market administration. 
46. Electricity prices are set by ANRE. The regulated prices and tariffs are set to cover the 
justified costs for generation, transmission, distribu tion, and supply. Cross-subsidies from industrial to 
residential consumers have been eliminated, and tariffs have increased in order to improve the 
viability of the subsector. In 2003, ANRE changed th e basis for setting prices from the "cost-plus" to 
the "rate-of-return" methodology, as a preparatory step for the introduction, from 1 January 2005, of 
the cap regulation.
49 Romania's electricity prices are still below EC-15 prices, although the difference 
decreased from €30.9/MWh in 1999 to €13.2/MWh in 2002 for industries, and from €68.1/MWh to 
€43.5/MWh for households. This partly reflects the 81.4% and 68.5% increases in Romania's 
electricity prices for industries and households, respectively, during 1999-04.  In April 2005, 
electricity prices for consumers were increased.  The consumer price of electricity is subject to VAT at 
19%, and to the excise duties introduced in 2005 (Table AIII.3). 
(4) MANUFACTURING  
(i) General 
47. Romania has a relatively diversified manufacturing sector50, which includes a labour-
intensive textile and clothing industries, and capital-in tensive iron and steel subsector. In addition, the 
automotive and electrical machinery industries have gr own rapidly over the last few years. As a result, 
the contribution of the manufacturing sector to GDP increased from 19% in 1999 to 22.6% in 2003;  
at the same time, it employed 48.2% of the labour force in private sector (compared with 45.5% in 
1999). Moreover, during 1991-04, manufacturing attract ed almost two thirds of Romania's FDI 
inflows (Chapter I(3)(ii)). 
48. Manufactured exports accounted for 82% of total merchandise exports in 2004 (up from 
76.7% in 2000), and consisted mainly of machiner y and transportation equipment, and textiles and 
clothing (28.9% and 27.4% of manufacturing exports, respectively). Manufactured products 
represented 77.8% of total merchandise imports in  2004, compared with 75. 2% in 2000, and are 
concentrated in more capital-intensive industries,  such as machinery and transport equipment, and 
chemicals (41.9% and 13.2% of manufacturing imports, respectively). 
49. Romania's main long-term objective in the manufacturing sector is to raise its competitiveness 
and productivity by reducing direct state intervention,  so as to be ready for accession to the EC. This 
                                                      
48 ANRE is an autonomous public institution under the coordination of the Prime Minister. It is entirely 
financed from funds outside the national budget, through fees obtained from licences, authorizations, and other 
regulatory activities in favour of companies. 
49 Since January 2005, a revenue ca p methodology applies to transmission tariffs, and a price basket 
approach to distribution tariffs. According to the authorities,  this system allows for fair return of capital (private 
or state-owned), covering operation and maintenance costs, including depreciation. 
50 Electric and thermal energy, and water are norma lly included in Romania's manufacturing statistics. WT/TPR/S/155/Rev.1 Trade Policy Review 
Page 72 
 
 
is to be achieved through, inter alia , the privatization (or liquidation)  of SOEs, and the promotion of 
outward-oriented, technology-intensive, and high- value-added production. The MEC is responsible 
for the overall running of the sector. 
50. MFN customs tariffs on manufactured goods (major division 3 of ISIC, Revision 2) average 
17.7%, with rates ranging from ze ro to 220% (Chart IV.1). The positive tariff escalation in most 
industries means relatively high effective rates of  protection, which somewhat impede the export 
competitiveness of Romania's manufactured products (Chapter III(2)(iv)(a)). Manufacturing is a 
major beneficiary of government support, including  state aid to domestic producers upon approval by 
the Competition Council; investment incentives, such as duty and tax con cessions, for promoting, 
inter alia , free zones, industrial parks, and SMEs (Chapter III(2)(iv)(e), (3)(iv), and (4)(i)). 
51. As a result of the recent acceleration of the privatization programmes, the private sector's 
share of industrial products increased from 53.7% in 1999 to an estimated 79% in 2003.51 
Nevertheless, the State continues to play an impor tant role in manufacturing, mainly through SOEs, 
some of which are loss-making. The State has signi ficant shares in some heavy industries, such as 
non-ferrous basic metals, chemicals, and iron and stee l, as well as in tobacco and alcoholic beverages. 
(ii) Selected industries 
(a) Textiles and clothing 
52. The textiles and clothing subsector remains one of Romania's key manufacturing industries in 
terms of trade, albeit at a decreasing rate; it accounted for 22.5% of merchandise exports in 2004 
(compared with 24.4% in 2000), and 12.2% of merchandise imports in 2004 (down from 15.6% in 
2000). The importance of two-way trade in the subsector is explained by the reliance of the Romanian industry on imports of fabrics, and the developmen t of outward processing of garments, mainly for 
companies in Italy, Germany, and France. Thus, the EC has traditionally been Romania's largest 
foreign market for both textiles and clothing . The subsector also contributes about 9% to 
manufacturing output, and employs 24.5% of worker s in the sector. Since its last TPR, Romania has 
been reorganizing its textiles and clothing industry in order to make it more competitive, shifting its 
production towards higher-value-added finished products and ready-made clothing, knitwear, 
garments, and stockings.  The subsector is dominated by the private sector, particularly SMEs, which 
account for 80% of companies. 
53. Imports of textile and clothing products in Ro mania are free of quantitative restrictions, but 
are subject to relatively high tariff protection at th e border. The MFN tariffs on textiles and clothing 
products average 20.9%, with rates ranging up to  40%. The textiles and clothing industry does not 
enjoy any specific incentives. However, it is a majo r beneficiary of the general incentives provided by 
the Government, such as exemption from custom s duties and taxes. The Export-Import Bank of 
Romania also supports the industry by, inter alia , reimbursing 50% of the interest paid on domestic 
loans when used to produce textiles a nd clothing for export (Chapter III(3)(iv)). 
54. Under the WTO Agreement on Textiles and Clothing (ATC), Romania notified that, as from 
1 January 2005, it would integrate all products  not previously integrated into GATT 1994.
52  Romania 
retained its right to use the transitional safe guard mechanism under the provisions of the ATC 
(Article 6) 53, but did not make use of it. 
                                                      
51 IMF (2004c). 
52 WTO document G/TMB/N/470, 2 April 2004. The subsector was integrated into GATT 1994 in four 
stages, on 1 January 1995, 1 January 1998, 1 January 2002, and 1 January 2005. 
53 WTO document G/TMB/N/57, 28 April 1995. Romania WT/TPR/S/155/Rev.1 
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111
122
210
230311
313
321
323
331341
351
353
355
361369
372
382384
390Chart IV.1
Romania's MFN tariff by ISIC classsification, 2005
Percent
WTO Secretariat calculations, based on data provided by the Romanian authorities.AverageMaximum
Minimum
International Standard Industrial Classification, Revision 2
Source :111 
121 
122
130210220
230
390311312
313
314321322
323
324
331
332
341
342Description
Agricultural and livestock production
Forestry
Logging
FishingCoal miningCrude petroleum and natural gas production
Metal ore mining
Other miningFood productionOther food products and animal feeds
Beverages
Tobacco manufacturingTextilesManufacture of wearing apparel, except footwear
Leather products, except footwear and wearing 
apparelFootwear, except vulcanized rubber or plastic footwearWood and wood products, except furniture
Manufacture of furniture and fixtures, except primarily of 
metalPaper and paper productsPrinting, publishing and allied industriesDescription
Industrial chemicals
Other chemicals, including pharmaceutical
Petroleum refineries
Manufacture of miscellaneous petroleum and coalproductsManufacture of rubber products n.e.s.
Manufacture of plastic products n.e.s.
Pottery, china and earthenwareManufacture of glass and glass productsOther non-metallic mineral products
Iron and steel basic industries
Non-ferrous metal basic industriesFabricated metal products, except machinery and equipment
Non-electrical machinery including computers
Electrical machinery apparatus, appliances and suppliesTransport equipment
Professional and scientific equipment
Other manufacturing industriesElectrical energy351
352
353
354
355
356
361362369
371
372381
382
383
384
385
390410220
0.010.020.030.040.050.060.070.080.090.0200.0
110.0150.0
100.0250.0
150 150
 WT/TPR/S/155/Rev.1 Trade Policy Review 
Page 74 
 
 
(b) Iron and steel 
55. Romania is the world's 27th largest producer of steel, with 6.1 million tonnes of steel in 2004; 
77.4% of production comes from Mittal Steel Galati . Romania is a net exporter of iron and steel 
products: in 2004, exports amounted to 3. 8 million tonnes (US$2,034 million, up from 
US$809 million in 2000), while imports reached 1.6 million tonnes (US$1,195 million, up from 
US$418 million in 2000). The industry employs 4.8%  of workers in the manufacturing sector. MFN 
tariffs on iron and steel products aver age 15.3%, with rates ranging up to 20%. 
56. Since its last TPR, Romania has been restructur ing the iron and steel subsector, which is now 
operated entirely by the private sector following the sale of Sidex, the largest steel-maker in South-
East Europe, and other iron and steel SOEs (Chapt er III(4)(ii)). In December 2004, Romania approved 
the Restructuring Strategy for the Steel Sector, a nd Viability Plans for Steel Companies. It envisages 
increased production, sales, and exports of steel  products, improved capacity utilization, and a 
reduction in employee numbers. According to the EC , however, additional clarification is needed, in 
particular with respect to the amount of state aid to be granted to individual iron and steel companies in order to restore their viability.
54 
57. The iron and steel industry, except for compani es included in the restructuring strategy, are 
eligible for specific incentives, su ch as state aid for closure, environmental protection, and R&D. 
Other state aid to the industry was terminated on 31 December 2004:  i.e. since 2005, companies are 
no longer eligible for restructuring or investment aid. Nevertheless, these industries are beneficiaries 
of the general incentives provided by the government (Chapter III(3)(iv)). 
(c) Automotive 
58. Romania's automotive industry has grown rapidly since 2000, with sales of 180,927 units in 
2004, up from 84,170 units in 2000. The passenger car i ndustry is the most important segment of the 
market, with 80% of total sales in 2004. Vehicles manufactured in Romania accounted for 67.5% of total sales in 2004 (down from 92.9% in 2000) . Romania's top vehicle maker is Dacia
55, owned by 
Renault of France, with 44.2% share of total sales  in 2004, followed by Daewoo Automobile Romania 
(15.1%), owned by Daewoo of the Republic of Korea.56  Relatively low labour costs, and unimpeded 
access to the European automotive market are some of the main reasons for the relatively high 
penetration of foreign firms into Romania' s automotive subsector, including autoparts. 
59. Romania is a net importer of automotive produc ts: exports amounted to US$751.5 million in 
2004 (US$197 million in 2000), while imports reached US$2.5 billion in 2004, up from 
US$430.8 million in 2000. The auto industry employs  3.5% of workers in the manufacturing sector. 
60. MFN tariffs on motor vehicles average 21.5%, with rates ranging up to 30%. In addition to 
customs duties, motor vehicles are subject to: an excise duty between 0 and 9% for new vehicles, and 
between 1.5% and 27% for used vehicles;  VAT at 19%;  and a road tax of 5%.  In principle, the excise duty, VAT, and road tax apply to domestica lly produced and imported vehicles. Romania has 
different customs valuation rules for new and used mo tor vehicles, including cars, all-terrain vehicles, 
trucks, motorcycles, and trailers (Chapter III(2)(ii)). 
                                                     
 
54 European Commission (2004c). 
55 The production of a cheap mid-range car that c ould be exported to Eu ropean markets was the 
original strategy behind Renault's purchase of Dacia in 1999 (Economist Intelligence Unit, 2005). 
56 Romanian Association of Ca rmakers and Importers (2004). Romania WT/TPR/S/155/Rev.1 
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61. Romania has revitalized its automotive indust ry, mainly by attracting foreign direct 
investment, through inter alia , incentive schemes, including state aid granted to Dacia. Nevertheless, 
according to the authorities, all incentives to  the automotive industry will be terminated on 
31 December 2006. Some other companies, such as Daewoo, became eligible for exemption of 
customs duties, and tax holidays on profits, by investing at least US$50 million in the industry, 
producing with a Romanian content of at le ast 50%, and exporting a minimum 50% of annual 
production. These incentives were eliminated in 2002 (Chapter III(2)(ix) and (3)(iv)).  
(5) SERVICES  
(i) Overview 
62. In 2004, the services sector contributed 53. 9% to GDP (down from 56.9% in 1999), and 
employed about one third of the labour force. Balance-of-payments data indicate that Romania's foreign trade account for services registered a defi cit of €213 million in 2004 (€260 million in 2000). 
In 2004, tourism accounted for about 14% of both to tal services receipts and total services debits 
(Chapter I(3)(i)). 
63. Since its previous TPR, Romania has taken me asures to tackle some of the structural 
problems in some services subsectors.  The fina ncial services' supervisory framework has been 
strengthened, Romtelecom's monopoly on the fixed te lephone market ended at the end of 2002, and 
the restructuring strategy is being implemented in the large loss-making railway subsector. Furthermore, several SOEs in the sector have been  privatized.  However, some SOEs still dominate 
services activities, including the Romanian Commercial  Bank, the largest bank in the country, and the 
national air carrier Tarom. Romania is trying to accelerate the privatization of some of these 
companies (Chapter III(4)(ii)). 
64. Under the General Agreement on Trade in Serv ices, Romania scheduled commitments across 
virtually all major service categories, and accepted the GATS Fourth and Fifth Protocols, on basic 
telecommunications and financial services.
57  Romania maintains MFN exemptions under Article II of 
the GATS, reserving the right to offer more favour able treatment to some WTO Members in some 
specific areas of transport services.58  Table AIV.2 provides details on Romania's commitments under 
the GATS.  Romania has yet to table an initial c onditional offer in the ongoing services negotiations. 
65. Services are not covered in Romania's preferen tial trading arrangements, with the exception 
of the Europe Agreement between Romania and the EC, which provides for the liberalization of trade 
in services through all modes of supply (Chapter II(4)(iii)). 
(ii) Financial services 
66. The Romanian financial system is based larg ely on the banking subsector, which holds more 
than 90% of total financial assets. Despite recent improvements, the financial services subsector is still under-performing compared with other transiti on economies, primarily in  terms of financial 
intermediation (e.g. low monetization, low domestic credit, and low stock market capitalization), and 
development of non-banking financial markets.  In  addition, Romania's payment system is largely 
cash based.
59  There was a series of major failures in  the subsector during the 1990s, notably the 
                                                      
57 WTO documents WT/LET/213, 30 January 1 998; and WT/LET/288, 18 February 1999. 
58 WTO document S/DCS/W/ROM, 24 January 2003 
59 Only one third of Romanian households have bank accounts; at end 2002, cash in circulation 
amounted to 3% of GDP.  WT/TPR/S/155/Rev.1 Trade Policy Review 
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reduction in banks' credibility. Cu rrent prudential regulations are based on best practices and are 
largely in line with international norms. 
67. Romania's main goal in the subsector is to pr omote an efficient, globally competitive, and 
sound financial services subsector, free of distortions . Romania has been harmonizing its legislation 
with EC directives and international standards over the last few years. 
(a) Banking 68. Romania's banking subsector is small relative to the size of the economy;  total assets were 
€23 billion at the end of 2004 (equivalent to about 38% of GDP).  Moreover, bank credit is very 
limited, representing only about 17.5% of GDP.  Ne vertheless, capital adequacy ratios in the 
Romanian banking system are well above the requi red regulatory minimum of 12%, and liquidity is 
high, albeit declining.
60 
69. Romania's credit institutions comprise:  two st ate-owned banks;  seven private domestically 
owned banks;  three forei gn-owned banks, which were  previously state-owne d, and which inherited 
large nationwide branch networks through which they mainly lend to SMEs;  five subsidiaries of large 
internationally active banks, which focus generally  on multinational and large domestic companies;  
18 foreign banks, generally with sm all and less-well-known parent ins titutions;  and seven branches of 
foreign banks. In addition, there is one credit cooperative institution.  Overall, foreign-owned banks 
held 62.1% of total banking assets in 2004, up fr om 47.5% at year-end 19 99. Banking concentration 
in Romania is fairly high: the five biggest banks ho ld about 59% of total assets, more than half of 
loans, and over 60% of T-bills portfolio.61 In principle, all banks operating in Romania are universal 
banks (i.e. allowed to carry out  all types of banking activities).62  
70. The National Bank of Romania (NBR), which is the supervisory authority for banking, is 
responsible for licensing credit institutions, subsid iaries, and branches of foreign banks, issuing 
banking regulations, and carryi ng out prudential supervision.63 The recent strengthening of NBR's 
supervisory role is perhaps the most important  element of Romania's financial reform. The 
amendment of the Banking Law (No. 58/1998) by Law No. 485/2003 allows NBR to move from 
merely checking compliance with the rules, towards a more risk-oriented approach. Interest rates on 
loans are set freely. 
71. To establish a bank or a branch of a foreign bank in Romania, authorization must be obtained 
from NBR; no distinction is made between local and foreign entities. The minimum share capital 
required to establish a bank is RON 37 million (about €10 million). Members of the Board of the bank 
must also be authorized by the NBR.64 
72. The rapid growth of loans granted to the public, a matter of prudential concern, is also being 
addressed through a Credit Bureau System (CBS) put in place by banks to monitor asset quality, and better assess the financial status of their debtors. In addition, from September 2004, the NBR's Central 
                                                     
 
60 The ratio of net liquid assets to deposits declined  to 43% in December 2004, from 45% in December 
2003. However, the banking system would be able to absorb large deposit withdrawals in case of bank failures (IMF, 2003). 
61 OECD (2003). 
62 The only exceptions are four specialized banks:  Eximbank; CEC (a savings bank); Raiffeisen Banca 
pentru Locuinte (specialized in mortgages) ; and Porsche Bank (specialized in cars). 
63 The NBR has closed some insolvent banks, and in some cases has refused banking licences, when 
the source of shareholders' capital contributions cannot be identified or is unsuitable (IMF, 2003). 
64 OECD (2003). Romania WT/TPR/S/155/Rev.1 
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Credit Register started to centralize credit inform ation, including on loans to individuals. NBR's 
banking supervision is now largely in compliance w ith all Basel Core Principles. Nevertheless, key 
governance weaknesses remain, for example unre liable financial reporti ng, and ineffective 
supervisory boards.  Obstacles like high fees and commissions con tinue to hinder the development of a 
fully fledged banking subsector.65 
(b) Insurance 
73. Romania's insurance subsector is small and unde rdeveloped, with assets at just over 1% of 
GDP. The ten largest insurance companies in Romani a hold over 80% of the market in terms of gross 
premium income. The number of insurance companies has been declining steadily during the last few 
years (there are 43 active companies, all private,  down from 72 in 1999 ), mainly as a result of 
increased minimum capital requirements (Order No . 3105/2005), newly introduced solvency rules, 
and stricter prudential rules on asset and liabilities.  Further consolidation is expected, given the new 
EC solvency requirements.66  
74. Since its last TPR, Romania has modified both its legislative and institutional framework on 
insurance. A new Insurance Law (No. 403/2004) was en acted to further align its legislation with the 
EC acquis  and international standards. The Insuran ce Supervisory Commission (ISC) was established 
on 2 July 2001 to strengthen the regulatory framework . The ISC is the supervisory authority in the 
subsector, and is responsible fo r pension schemes provided by insurers. The revised legislation 
eliminates restrictions regarding the obligation on insurers to keep their assets in Romania, and 
includes specific provisions on the establishment and authorization of insurance companies.  
75. An authorization from the ISC is required to establish an insurance company. Minimum 
capital requirements, to be adjusted not later th an 31 December 2005, are:  RON 5 million for non-
life, except for compulsory insurance; RON 8 million for compulsory non-life insurance; and 
RON 8 million for life insurance.67 No distinction is made between local and foreign entities. All 
insurance companies authorized be fore EC accession may supply all ty pes of insurance services. After 
Romania's accession to the EC, new insurance comp anies will be specialized, while those licensed 
before will require separate management for lif e and non-life services. Cross-border supply of 
insurance services is allowed. Banks can also suppl y insurance services. All tariffs for compulsory 
insurance are set by the ISC; companies may increase or lower tariffs by 10%.  All other tariffs are set 
freely by the companies.    
(c) Securities 
76. The capital market in Romania is one of the sm allest in Eastern Europe, with an estimated 
market capitalization of around 18% of GDP in 2004. Equity market capitalization is insufficient to justify the coexistence of two independent exch anges (the Bucharest Stock Exchange, and the 
RASDAQ Electronic Exchange (BER)), and to ensure  the sustainability of functioning capital markets 
over the long run. Despite rapid growth in both exchanges in the last few years, liquidity remains 
poor, as transaction volume is concentrated in a limited number of stocks. The top-ten listed 
                                                     
 
65 European Commission (2004b). 
66 See WTO (2004b). 
67 Minimum capital requirements will be adjusted, not later than 30 June 2006, as follows: 
RON 8 million for non-life, except for compulsory insu rance; RON 12 million for compulsory non-life; and 
RON 12 million for life (Order No. 3109/2004).  WT/TPR/S/155/Rev.1 Trade Policy Review 
Page 78 
 
 
companies account for over 85% of market capita lization.  Investor confidence has been shaken 
following the collapse of two large open-ended m oney market mutual funds in 1996 and 2000.68 
77. The Romanian securities subsector is currently under restructuring both in terms of legislative 
reforms, and the process of co nsolidation of the capital markets and clearing and post trading 
infrastructures. A new Capital Market Law (No. 297/2004) entered into force at the end of July 2004 
aimed at, inter alia , further alignment with the acquis  on investment services, market abuse, and 
undertakings for collective investments, including in  transferable securities (UCITS).  According to 
the EC, however, extensive secondary legislation is  needed in order to implement most of the 
provisions contained in the new Capital Market Law.69 
78. The National Securities Commission (CNVM) was established in 1994 as the body in charge 
of securities market supervision. However, the CNVM 's authority to investigate violations of the 
Capital Market Law or to effect the orderly windi ng-up of entities is limited by its inability to obtain 
documents from non-registered. Furthermore, so me of the companies listed on the two stock 
exchanges are in violation of listing rules, as they ha ve never been traded, have rarely bid or requested 
quotes, do not file periodic reports, or have too few shareholders. In addition, the CNVM needs more 
staff and training in order to  perform adequate oversight.70 Securities and other non-banking financial 
companies operating on the capital market must be aut horized by the CNVM.  No distinction is made 
between local and foreign entities. 
(iii) Telecommunications and postal services 
79. Since its last TPR, Romania's telecommunications  network has continued to grow, notably the 
mobile market where the number of subscribers jumped from 1.35 million in 1999 to 10.2 million  in 
2004 (Table IV.3). Similarly, the number of Internet users increased from 625,500 in 1999 to 
5.3 million in 2004, and the numbe r of personal computers climbe d from about 640,000 to around 
2.5 million. At the end of 2004, there were almost  5 million fixed telephone lines in service, i.e. a 
teledensity of almost 21 (up from 16.01 in 1998). Ne vertheless, the penetration of telephones remains 
well below the EC average for both fixed and mobile telephony.71 Romania's telecommunications 
market value rose from €1.4 billion in 1999 to €3. 3 billion in 2004. In terms of GDP, total 
telecommunications expenditure increased from 6.3% in 2001 to 8% in 2004. 
80. The Romanian telecommunications subsector is engaged in a liberalization process, notably 
through the elimination of Romtelecom's fixed telephone monopoly as from 1 January 2003.  Besides  
Romtelecom72, there are 60 companies that can provide telephone services using their own fixed 
networks or Romtelecom's infrastructure. New en trants are expected in the market in 2005. In 
addition, there are about 30 provi ders of telephone services through pr epaid cards for international 
calls. More competition has resulted in lower tariffs, pa rticularly for international calls;  charges went 
down by almost 60% in 2003, compared with 2002.73 As from 1 February 2005, Romtelecom's 
international fixed-to-fixed tariffs decreased by 9. 1% on average. According to the authorities, for 
                                                      
68 IMF (2003). 
69 European Commission (2004c). 
70 European Commission (2004b). 
71 In 2003, Romania's fixed telephone penetration was 20 lines per 100 inhabitants, compared with an 
average of 57 for the EC-15, and 30 for the ten new EC members; Romania's mobile telephone penetration rate was 47% in 2004, compared with  an EC-15 average of 79%.  
72 Romtelecom is owned by OTE Telecom (54.01%) from Greece, and the Roma nian State (45.99%). 
73 In 2003, the price charged by the fixed incumbent operator (Romtelecom) for a ten-minute 
international call to a nearby country was €3.21;  the price charged by the alternative fixed operator was €1.31. Romania WT/TPR/S/155/Rev.1 
 Page 79 
 
 
technical reasons (frequency allocation), only four mobile telephone compan ies operate in Romania 
Orange Romania74, Mobifon75, Cosmorom76, and Telemobil;  the first two hold 96.4% of the market. 
Table IV.3 
Selected telecommunica tion indicators, 1999-04 
 1999 2001 2002 2003 2004 
Main telephone lines ('000) 3,705 4,029 4,207 4,330 4,389 
Main lines per 100 inhabitants 16.20 18.00 19.30 19.92 20.25 
Cellular mobile subscribers ('000) 1,126 4,595 5,099 7,065 10,216 
Cellular subscribers per 100 inhabitants 5.01 10.50 23.39 32.50 47.12 
Internet users ('000) 625.5 1,000 2,200 4,150 5,280 
Internet providers 150 400 495 527 660 
Personal computers ('000) 640 800 1,800 2,100 2,500 
Personal computers per 100 inhabitants 2.85 3.57 8.26 9.75 11.36 
Telecommunications market value (€ million) 1,415 2,190 2,491 2,645 3,300 
Telecommunications expenditure (% GDP) .. 6.3 5.6 5.3 8.0 
.. Not available. 
Source:  ITU (2004), Telecommunication Indicators , Geneva;  and information provid ed by the Romanian authorities.  
81. The National Regulatory Authority for Comm unications (ANRC), an independent body 
established in 2002, is responsible for implementi ng Romania's policy for electronic communications 
and postal services.  This includes promoting competition, encouraging new investments and innovation, protecting users against abuse by service providers, and ensuring the right to universal 
services. In addition, Romania has five othe r institutions with various competences in 
telecommunications: (i) the Ministry of Comm unications and Information Technology (MCTI) 
administers the State's telecom shares portfolio
77, and manages the Nati onal Frequency Bands 
Allocation Table; (ii) the General Inspectorat e for Communications and Information Technology 
(IGCTI), established in 2004,  has taken over most of MCTI's functions, and is now responsible for 
managing and monitoring the radio frequency spect rum and the respective bands, granting licences 
for their use (licensed operators pay an annual sp ectrum usage tariff), as well as drafting, adopting, 
and publishing administrative regulations on radio-communications ; (iii) the Competition Council is 
involved mainly in cases where access agreemen ts include non-competitive clauses, and where 
investigations are required78; (iv) the National Audiovisual Council (CAN), founded in 1992, 
authorizes the granting of broadcasting licences, and adopts the broadcasting authorization procedure; 
and (v) the National Authority for the Control and Supervision of Personal Character Data Processing, 
an independent body established on 27 June 2005, took over from the Romanian Ombudsman 
supervising the protection of  personal data and privacy. 
82. Any person (natural or legal) can provide electronic communications networks or services, 
according to the general authorization regime, after submitting a notification to the ANRC. An 
application form, together with certain required documents, must be submitted at least seven days 
                                                      
74 During 2004, France Telecom consolidated its majority shareholder position in Orange Romania. 
75 Mobifone is owned by UK's Vodafone (99%) and Romanian private companies (1%). 
76 Cosmorom is the mobile telephony arm of Romtelecom. On 7 July 2005, Cosmote Mobile 
Communications S.A. (Cosmote) from Greece bought 70 % of Cosmorom; Romtelecom owns the remaining 
30% of Cosmorom's shares. 
77 On 14 July 2005, the Government approved the initiation of the privatization processes for SN 
Radiocomunicatii (SNR) and National Company Posta Roma na (NCPR), as well as the finalization of the 
privatization of Romtelecom. The Romanian State owns 100% of the shares of SNR and NCPR, and 45.99% of 
Romtelecom.  
78 In July 2004, ANRC and the Competition Council set out the terms for mutual cooperation. WT/TPR/S/155/Rev.1 Trade Policy Review 
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before starting operations. There is no fee, but the undertakings must pay a monitoring tariff (to the 
ANRC) of up to 0.5% of their annual turnover, and the relevant authorities can impose certain fees for 
granting the use of numbering resources (through a licence from the ANRC valid for ten years) and 
radio-electric spectrum (through a licence from the IGCTI, with unlimited duration). Licences are 
granted only for the networks or services identified and detailed in the application form. Romanian 
and foreign companies are treated equally, and the licence application procedure is the same for fixed-
line and mobile telephony. 
83. Interconnection agreements are negotiated between operators on the basis of the Access and 
Interconnection Ordinance (No. 34/2002).79  In 2004, the ANRC completed the rules for access and 
interconnection to the public fixed-line network. Interconnection to the fixed-line network of the 
incumbent, Romtelecom, is subject to the conditions  provided in its referen ce interconnection offer. 
Vital facilities (e.g. carrier selection, carrier pr e-selection, and number portability) are rarely 
available.  The present national numbering plan (N NP) is being analysed by the ANRC, including for 
the possibility of introducing the modality of number portability at the end of 2005.80 
84. The mobile telephony incumbents have been designated by the ANRC as significant market 
power (SMP) operators, and are subject to specific obligations. While Cosmorom and Telemobil have 
not been obliged to accept a maximum tariff, interc onnection tariffs for Mobifon and Orange Romania 
have been limited to US$0.10 until cost-orientati on computing methods are passed. The cost-oriented 
tariffs will be decided by reconciliation of the "bottom-up" long-run incremental costs method 
developed by the ANRC, with the "top-down" method  drafted by the mobile operators under the rules 
set out by the ANRC. 
85. Romtelecom is the only operator that must have ANRC approval for proposed increases in 
retail tariffs. Operators of public networks, and the publicly available electronic communications 
networks and services must make clear their tariffs  and prices to the public. Romania has no general 
regulation on cross-subsidization; Romtelecom h as an accounting separation obligation set by the 
ANRC for activities related to interconnection and access  to associated facilities. The specific fees 
that apply to telecoms are: an annual monitori ng fee, payable to the ANR C;  spectrum-use fee, 
payable to the IGCTI;  numbering resources fee (not yet established), payable to the ANRC;  and universal service contribution, payable to the ANRC.
81 
86. Government Ordinance No. 31/2002 on pos tal services (amended by Law No. 642/2002) 
designates the ANRC as Romania's postal regulator, and is aimed at ensuring access to universal 
services, with a view to creating a competitive market, and promoting user interests.82 The right to 
provide postal services in Romania is granted either  on the basis of the general authorization regime 
(for postal services not included in the scope of universal services), or by individual licences (for 
postal services included as universal services). Ba sic postal services were under monopoly until 2001, 
when the market was liberalized.  
                                                      
79 Currently, 41 operators have concluded direct fixed-line interconnection agreements with 
Romtelecom, and another six are indirectly interconnected. Regarding mobile networks, 20 operators have 
concluded interconnection agreements with Mobifon and 22 with Orange Romania. 
80 European Commission (2004c).  ANRC assigns the numbering resources corresponding to the NNP 
through a licensing procedure. The licence sets out the conditions under which its holder may use the assigned 
numbers for the purpose of providing electronic communications networks and services. 
81 The contribution amounts to 0.5% of the provider's turnover, minus revenues from interconnection 
and roaming services provided on the wholesale market to the mobile telephony operators from outside 
Romania for their users in Romania. The contribution shall not exceed €2 million for each provider. 
82 Government Ordinance No. 31/2002, as amended by Law No. 642/2002, repealed Law No. 83/1996, 
which defined and classified Romania's postal services, an d introduced a licensing syst em for postal operators. Romania WT/TPR/S/155/Rev.1 
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87. In April 2004, the state-owned National Compan y Posta Romana (NCPR) was designated as 
the only operator authorized to provide universal postal services to all users for five years.83 In 
addition, the ANRC granted the NCPR exclusive ri ght to deliver correspondence items weighing less 
than 100 grams until 31 December 2005, and items  under 50 grams until 31 December 2008.  There 
are also 150 providers of postal service s under the general authorization regime. 
(iv) Transport 
(a) Overview 
88. Transport infrastructure, according to the Romani an Constitution, is the property of the State. 
Transport infrastructure assets, therefore, are ad ministered by national entities, companies, or 
corporations under the jurisdiction and monitoring of  the Ministry of Transport, Constructions and 
Tourism (MTCT), which may award these assets under concession, in accordance with Romanian 
laws. The MTCT, through general directorates, is in charge of, inter alia , setting up the general 
transport policy, defining needs, in terms of ne twork development, mon itoring transport activities 
through licensing of operators, and setting up rules and regulations for the subsector.84 Romania's 
selected transport statistics for 2000 a nd 2004 are presented in Table IV.4. 
Table IV.4 
Selected transport statistics, 2000 and 2004 
 2000 2004 
Railway transport    
Transported goods ('000 tonnes)  71,461  72,738  
  National  52,844  51,130  
  International  17,868  20,929  
  Transit  749 679 
Transported passengers ('000 passengers)  117,501  99,434  
  National  116,617  98,914  
  International  884 520 
Operated tracks (km)  22,363  21,360  
Road transport   
Length of road (km)  78,479  79,454  
  Motorways  113 228 
Number of motorcycles  117,155  104,509  
Number of buses  32,283  25,421  
Number of cars  3,128,782  3,225,367  
Number of goods vehicles 448,601  482,425  
Transported goods ('000 tonnes)  262,943  294,221  
  National  259,832  281,717  
  International  2,844  12,470  
  Transit  267 34 
Transported passengers ('000 passengers)  205,979  216,524  
  National  204,491  212,474  
  International  1,488  4,050  
Air transport   
Passenger aircraft 28 33 
Cargo aircraft 3 1 
Transported goods ('000 tonnes) 7.6 5.1 
  National 0.4 2.8 
  International 7.2 2.3 
Table IV.4 (cont'd)
                                                      
83 ANRC President's Decision No. 88/2004. 
84 Louis Berger SA (2002). WT/TPR/S/155/Rev.1 Trade Policy Review 
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 2000 2004 
Transported passengers ('000 passengers) 1,282 1,337 
  National 161 192 
  International 1,121 1,145 
Freight and mail  16,099 19,697 
  Loaded 5,263 7,041 
  Unloaded 10,836 12,656 
Passengers embarked and disembarked 2,358,103 3,405,710 
  Embarked 1,153,921 1,690,398 
  Disembarked 1,204,182 1,715,312 
Maritime transport   
Number of freight ships 192 129 
Number of passenger ships 2 2 
Number of fishing boats  13 12 
Transported goods ('000 tonnes) 1,357 157 
  National 0 0 
  International 320 30 
  Other international transport 1,037 127 
Harbour traffic ('000 tonnes) 24,025 40,531 
  Loaded goods 12,252 18,225 
  Unloaded goods 11,773 22,306 
Source:  Information provided by the Romanian authorities. 
89. Romania's transport strategy includes: furt her liberalization to increase competitiveness, 
especially for rail and air transport; and rehabilita tion, modernization, and development of the 
transport infrastructure through financing from the World Bank, the European Bank for Reconstruction and Development (EBRD), EC pre-accession programmes, or private sources. The 
strategy is aimed at improving the quality of ser vices, traffic safety, and transport security, while 
protecting the environment; encouraging efficient fr eight transport; restructuring SOEs subordinated 
to the MTCT so as to increase their efficiency, reduce subsidies, and prepare them for privatization; 
helping Romanian investment projects abroad; en suring social protection of the population; and 
aligning the national transport with the acquis , including its integration into the Trans-European 
transport networks.
85 
90. Transport services were included in Romania's schedule of commitments under the GATS 
(Table AIV.1). Romania maintains Article II MFN ex emptions on internal waterways transport, sales 
and marketing services for air transport, and road transport services.86 
(b) Railway transport 
91. Romania's rail network consists of 11,0 53 km of lines under operation, of which 
3,965 (34.9%) are electrified, and 2,965 km are doubl e track lines. As part of the Pan-European 
railway investment programme, projects amounting to over US$6 billion are being implemented to 
improve Romania's railways during 2002-10.87 
                                                      
85 Ministry of Transport, Constructions, and Tourism online information.  Available at: www.mt.ro/ 
engleza/strategy_mlptl.html. 
86 WTO document S/DCS/W/ROM, 24 January 2003. 
87 Ministry of Public Works, Transport and Housing online information.  Available at: www.mt.ro/ 
engleza/strategii/railway/sld.htm. Romania WT/TPR/S/155/Rev.1 
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92. Of all public utilities in Romania, railway tr ansport has undergone the most changes to, inter 
alia, stop losses, reduce subsidies, and allevi ate the arrears problem (Chapter III(4)(ii)).88 As part of 
the restructuring programme, the National Railway Company (SNCFR) has been split into five main 
entities: CFR infrastructure, CFR freight, CFR passengers, the Railway Financial Management 
Company, and the Railway Assets Administration Company. In 2000, CFR passengers was divided 
into eight regional units. Moreover, freight transpor t has been liberalized; five operators have been 
licensed, and subsidies are no longer provided.89 Privatization of CFR freight is to be the final stage of 
the railway reform.90 
93. In 2003, Government Decision (No. 850/2003) was adopted on the inter-operability of the 
railway system. A railway regulatory body was estab lished in 2004, but it is yet to start operations.91 
A reinforced plan, setting out a long-term railway fi nancial strategy, is being elaborated by MTCT. A 
second railway package has just b een introduced, stipulating the network access rights for foreign 
railway undertakings for the purpose of operating all types of rail freight services. It is expected to enter into force by the time of Romania's EC accession.
92 
(c) Road transport 
94. Romania has a total road network of 79,454 km, including 15,712 km of national roads and 
only two motorways.93 Several road projects are under way. In the context of the trans-European 
transport network, the construction of the Bors-Clu j-Brasov motorway raised some concerns in the 
EC in terms of Romania's procurement rules (Chapter III(2)(viii)). 
95. The MTCT has defined a road transport strate gy until 2015, and a subse quent long-term plan, 
structured on a yearly basis for motorway construc tion, widening the national roads to four traffic 
lanes, rehabilitating/modernizing national roads, and construction of by-passes. Romania's roads and 
bridges are managed by the National Company of  Motorways and National Roads of Romania 
(NCMNRR). A major restructuring and commercia lization of NCMNRR is being implemented 
through, inter alia , more foreign investment in the repair, maintenance, and signalling activities; 
reclassification of roads; and increased use of products and equipment produced in Romania 
(e.g. chemical products).94 
96. Since its last TPR, Romania has introduced some  road-related legislative changes mainly to 
align its laws and regulations with the acquis . In 2002, Romania ratified the multilateral European 
agreement on international occasional carriage of passengers by coach and bus, and introduced the 
concept of collecting fees for the use of road trans port infrastructure. The level of road user charges 
will increase gradually with a view to ending di scrimination between Romanian and EC hauliers.95 
                                                      
88 In 2003, the Government decide d to reduce the workforce by abou t 18%, and to close some 3,000-
3,500 km of railway line, to help improve financial performance and prevent the emergence of arrears. In 2004, 
the authorities agreed to hold their commitments on closure/privatization, and to grant no wage increases in railways, and the 2005 wage bill is expected to  increase by no more than 8% (IMF, 2004b). 
89 EC online information.  Available at: www.europa.int/scadplus/leg/en/lvb/e13108.htm. 
90 Romanian Forum online information.  Availabl e at: www.romanian.eu.com/Romania/sectors6.htm. 
91 Government Ordinance No. 89/2003, approved by Law No. 8/2004. The rules of procedure, as well 
as the tasks and financing of the regulatory body, have been elaborated by MTCT and are to be approved through a Government Decision. 
92 Law No. 155/2005. 
93 Romania's motorways run fro m Bucharest to Pitesti, an d from Bucharest to Drajna. 
94 Ministry of Public Works, Transport and Housing online information.  Available at: www.mt.ro/ 
engleza/strategii/autos trazi_engleza/sld.htm. 
95 According to the authorities, as from 1 January 200 7, the roads user charges will be the same for 
Romanian and EC hauliers; the charge level will be that applied by the EC. WT/TPR/S/155/Rev.1 Trade Policy Review 
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Moreover, the Road Traffic Code has been updated,  with harmonization of the provisions on driving 
licences and compulsory use of safety belts. In it s negotiations with the EC, Romania has been 
granted transitional arrangements concerning maximum we ight in international traffic for certain road 
vehicles96, and concerning maximum tax rates to be paid by vehicles involved in domestic traffic. It 
agreed to fully open its primary road network as of  accession (i.e. EC trucks will be allowed to use 
Romanian roads). Romania accepted a transitiona l arrangement concerning road haulage cabotage 
operations.97 Romania has bilateral agreements with ot her countries regarding international road 
transport, in which road haulage cabotage is forbidden.98  
(d) Air transport 
97. Air transport in Romania is dominated by th e national carrier, the loss-making state-owned 
Tarom.99 In 2000,  66% of Tarom was offered for privatization, but  no offers were received. The 
Government, therefore, decided to restructure the company (e.g. staff reductions, purchases of new aircraft (it currently has 16), and the introducti on of new destinations) before putting it up for 
privatization again. In recent years, several sm all private domestic companies have entered the 
Romanian air transport market.
100 Romania has 17 airports (eight international);  the most important 
are Bucharest Otopeni (75% of total traffic), fo llowed by Bucharest Baneasa (9.3%), and Timisoara 
(5.2%). The rehabilitation and modernization of infrast ructure of all airports is continuing, partially 
financed by local and regional governments. 
98. Investors in civil air transport activities requi re approval from the Romanian Civil Aviation 
Authority (RCAA). There is no discrimination be tween local and foreign entities in the approval 
procedure.  The RCAA, established by Decision No. 405/1993, is a self-financing, autonomous 
organization managing the regulati ng and oversight of Romania's civil aviation, including certifying 
civil aviation products and services.101 
99. Since its last TPR, Romania has modified its air transport legislation in order to harmonize it 
with the acquis . Secondary legislation entered into force on the licensing of air carriers, technical 
investigation of accidents, and certification proce dures for planes and auxiliary products. Romania 
also signed the Montreal Convention on air carrier liability. Moreover, legislation has been adopted 
on the investigation of accidents and incidents in  civil aviation, denied-boarding compensation 
system, the ground-handling market at airports, and noise-related operating restrictions. Further 
transposition is expected regarding security legislation.102 On 31 July 2005, the National Aviation 
Security Programme entered into force;  th e National Quality Control Programme on aviation 
security, including certifying civil avia tion products and services, is envisaged to enter into force at 
the end of 2005. 
                                                      
96 Work is in progress to make Romanian road networks suitable for 11.5 tonnes axle weight (the EC 
norm). 
97 European Commission (2005). 
98 A draft law to be submitted to the Romanian Pa rliament in autumn 2005 considers cabotage as a 
contravention.  
99 Tarom's ownership is divided as follows: Ministry of Public Works, Transport and Housing 
(92.63%); Romanian Air Traffic (5.42%); Muntenia Private Financial Investment Fund (1.43%); and Romanian Civil Aviation Authority (0.52%) (Tarom online information.  Available at:  http://www.tarom.ro/English/ 
browse.php/development).  
100 Some of these companies (e.g. Ai rom 2000, Carpatair, and Acvila Ai r) operate in niches where they 
can avoid competition with Tarom, such as regional tran sportation, and tourist charter flights (Romanian Forum 
online information.  Available at: www.romanian.eu.com/Romania/sectors6.htm). 
101 RCAA online information.  Available at: www.caa.ro /en/About/pro file.html. 
102 European Commission (2004c). Romania WT/TPR/S/155/Rev.1 
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100. In general, air carriers operating scheduled servi ces to Romania are authorized on the basis of 
reciprocity within the framework of Romania's bila teral air transport agreements. An exception is the 
Open Sky Agreement concluded between Romania a nd the United States. Cabotage is not permitted 
(i.e. foreign airlines are not allowed to carry domes tic traffic between two locations within Romania). 
Air fares (domestic and international) are set freely,  and are not subject to government controls. Four 
airports are owned by the MTCT, 12 are owned by re gional councils, and there is one private airport. 
The number of ground handling suppliers is not restricted in Romanian airports. The management at each airport is responsible for selecting ground- handling suppliers, who must hold a valid licence 
from the RCAA.  
(e) Maritime transport 
101. Maritime transport is handled at three Black Sea Ports (Constanta
103, Midia, and Mangalia). 
There are four other ports (Braila, Galati, Tulcea, a nd Sulina) used for inland waterway and maritime 
transport and 26 other fluvial ports. Over 50% of Romania's port and inland waterways infrastructure 
need reconstruction and modernization.104  Another key problem is safety in inland waterways and 
maritime transport.  Romania is still on the black  list (very high risk) of the Paris Memorandum of 
Understanding. Nevertheless, the share of Romanian  flag vessels detained following port control fell 
from 23.5% in 2001 to 4.2% in 2004105;  according to the authorities, no detention was registered 
during the first six months of 2005. 
102. Ships  within Romanian territori al waters (irrespective of their flags) must comply with the 
dispositions of the Romanian Naval Authority (R NA), an autonomous entity under the MTCT.  The 
RNA is in charge of the supervision, design, a nd implementation of mariti me regulations, including 
granting the right to sail under Romanian flag.106 Ports and navigation infrastructure are managed by 
each port administration (under the responsibility of MTCT), such as the Constanta Port 
Administration. 
103. According to Romanian legislation on civil maritime transport107, free and non-discriminatory 
access of international maritime and fluvial tr ansport of goods and/or persons is permitted in 
Romanian harbours, irrespective of the registration nationality of the ship. Provided that the required 
technical standards are fulfilled, the right to sail unde r the Romanian flag is given to: ships owned by 
Romanian natural or legal entities; ships owned by  foreign entities residing in Romania or Romanian 
branches of foreign legal entities; and ships that ar e owned by foreign legal or natural entities and are 
rented by bareboat or leased for periods exceeding a year.108  Within Romanian territorial waters, the 
following activities are reserved for ships flying the Romanian flag: carriage to Romanian harbours; 
cabotage from one local harbour to another; assist ance and rescue operations; removal of wrecks; 
works of realization and continuation of hydro tech nical constructions; fishi ng; and exploration and 
exploitation of resources.  Nevertheless, ships regi stered under foreign flags can engage in fishing, 
and in resources exploration and exploitation, subject to approval by the competent authorities.109 
                                                      
103 Constanta, the biggest Black Sea port, is Romania's major seaport, with depth up to 19 meters, and 
berths and specialized equipment for handling all types of goods. 
104 Romanian Forum online information.  Availabl e at: www.romanian.eu.com/Romania/sectors6.htm. 
105 The average for EC-flagged vessels detained was 2.8% in 2003 (European Commission, 2004c). 
106 RNA online information.  Available at: http://www.rna.ro/SiteEng/Index.htm. 
107 Government Ordinance No. 42/1997 (amended in March 2004), and Law No. 412/2002.  
108 These ships lose the right to fly the Romanian flag when the bareboat or leasing contract finishes or 
upon demand of the ship owner. 
109 For the other types of operations, ships registered under foreign flags may be used, provided that 
Romanian ships are not availabl e or are not technically fit for those operations (OECD, 2003). WT/TPR/S/155/Rev.1 Trade Policy Review 
Page 86 
 
 
104. Since its last TPR, Romania has amended its le gislation on inland waterway and maritime 
transport, mainly to harmonize it with the acquis . The register of inland waterway vessels flying the 
Romanian flag has been updated. Several lega l measures have been adopted, such as on vessels 
carrying dangerous goods, port control, enforcement of pollution prevention, and shipboard living and 
working conditions. Stricter rules were introduced in 2004 for vessels older than 20 years, and for 
vessels detained more than twice a year. The clean-up of the national shipping registry has continued, 
so that only 14 ships are currently flying the Roma nian flag.  Administrative procedures for vessel 
inspections are expected to be improved and the Inland Waterway Fund established.110 
105. Maritime services related to vessels entering and leaving Romanian ports (pilotage services) 
are considered as public services of national interest . Therefore, their charges are set by MTCT, and 
are stipulated in the concession contract. For ot her maritime services, such as towage, mooring-
unmooring, and cargo-handling services, prices are set  freely by private companies, subject to 
negotiation with the services users.  Port ope rators are obliged to publish their tariffs. 
(v) Tourism 
106. Despite Romania's efforts in recent years to impr ove its tourism infrastructure, and the tourist 
promotion offices it has set up abroad, tourism revenu es remain low in absolute terms and in relation 
to other countries in the region.111  Romania's tourism receipts amounted to €406 million in 2004, 
while expenditure by Romanian tourists reached €434 million.112 Nevertheless, 6.6 million visitors 
arrived in 2004 (up from 5.2  million  in 1999), mainly from neighbouring countries. Total 
accommodation capacity in Romania fell from 282, 806 places in 1999 to 275,941 in 2004. Hotels 
represent 58.1% of total accommodation capacity; their occupancy rate was 34.3% in 2004. 
According to the authorities, about 98% of the tour ism subsector in Romania has been privatized, and 
hotels belong to commercial tourism societies.  
107. Romania has considerable potential to provide  tourism services. It boasts beaches on the 
Black Sea, ski stations for winter sports, and a rich  cultural history of monasteries and castles, as well 
as medieval villages. Romania also  has the potential to offer eco-tourism in the wild Carpathian 
mountains and the protected natural reserve of th e Danube Delta, and rural or village tourism in 
certain areas. 
108. The National Authority for Tourism, establishe d in 2002 under the MTCT, is in charge of 
hotel/restaurant classification, and inspection.113  The main tourism policy goals include: developing 
Romania's tourism potential by improving the infrastruct ure for hotels, restaurants, entertainment, and 
communication services; modernizing the road transportation network, the main means of transport 
used by domestic and international tourists;  comp leting privatization of the subsector, with the goal 
of attracting further foreign direct investment; and ensuring the continuity of its natural and cultural 
assets. 
109. The Romanian Government remains active in the tourism subsector by, inter alia , providing 
infrastructure and public services; defining zones with high tourism potential; elaborating plans for 
the development of the subsector; conducting envi ronmental controls; and promoting the country 
                                                      
110 Compliance with EC norms is n ecessary because a key objective of  the authorities is access to the 
Rhine (Europa online information.  Available at:  http://www.europa.int/scadpl us/leg/en/lvb/e13108.htm). 
111 It has been estimated that tourism revenues in Romania are three times less per visitor than in 
Bulgaria, and ten times less than in Croatia (Louis Berger SA, 2002). 
112 World Tourism Organization (2004). 
113 Government Decision No. 1328/2001, and Minister of Tourism Order No. 510/2002. Romania WT/TPR/S/155/Rev.1 
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abroad. Local administrations are r esponsible for similar matters at the local level.  A Special Fund 
for Tourism Promotion and Development was abolis hed in 2001. All hotel bills include a 9% VAT. 
110. Foreign companies have increased their role in tourism in recent years;  there is no limit on 
foreign investment in the subsector. Foreign and domestic companies are allowed to set their own 
prices.  However, companies must inform the MTCT of their maximum prices, and prices must be 
cleared annually by the MTCT.  Enterprises ar e not required to charge uniform prices.  
111. In its GATS Schedule, Romania scheduled commitm ents on hotels and restaurants, as well as 
on travel agencies, tour operators, and tourist guides (Table AIV.2). Romania WT/TPR/S/155/Rev.1 
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