tax legal alerts

News

Tax & Legal Weekly Alerts

Our weekly Tax & Legal Alerts provide you with information on different tax and legal issues in Romania.

Amendments and completions regarding the regulation of some accounting aspects and for the approval of the Accounting Reporting System at June 30, 2021.

The order 762/2021 was published in the Official Gazette of Romania, Part I, no. 697 from 14.07.2021 which provides details related to the regulation of some statutory accounting aspects. It modifies and completes the order of the Minister of Public Finance, no. 1802/2014, published in the Official Gazette of Romania, Part I, no. 963 of December 30, 2014, with subsequent amendments and completions, which extends the aria of applicability of the statutory accounting regulations and establishes requirements for the first year of application of the accounting regulations, as well as thereafter for foreign legal entities that have the place of exercise of effective leadership in Romania.

In the Official Gazette of Romania, Part I, no. 699 of 15.07.2021, the order 763/2021 was published for the approval of the Accounting Reporting System on June 30, 2021 which applies to the economic operators who are incidents accounting regulations approved by Order OMFP no. 1802 / 2014 and by OMFP no. 2844 / 2016 and which in the previous financial year recorded a net turnover at least equal to the RON equivalent of EUR 1,000,000.

Starting with July 1st, 2021, in the context of the implementation of the new European VAT rules included in the e-commerce package, the One Stop Shop (“OSS”) system becomes operational in Romania.

The Government Emergency Ordinance no. 59/2021 published in the Official Gazette on June 28th, 2021, aimed to amend the Tax code, transposes in the national legislation the new European VAT provisions on e-commerce.

The authorities adopted the Emergency Ordinance no. 19/2021 regarding certain tax measures and the amendment of certain normative acts in the tax field

On March 29, 2021, the authorities published in the Official Gazette no. 315/29.03.2021, Emergency Ordinance no. 19/2021 regarding certain tax measures and the amendment of certain normative acts in the tax field (“GEO 19/2021” or “the Ordinance”).

Amongst the most relevant aspect, GEO 19/2021 provides for the following:
• The extension of some fiscal measures intended to help taxpayers get through the issues determined by the COVID-19 pandemic (initially provided by Government Ordinance no. 6/2019, Emergency Ordinance no. 48/2020, Emergency Ordinance no. 69/2020 and Emergency Ordinance no. 181/2020), including an extension of the tax amnesty provided by Emergency Ordinance no. 69/2020;
• Amendments regarding Law no. 227/2015 regarding the Tax Code;
• New tax provision regarding early education.

Digital platforms beware: new reporting requirements from the European Union. The European Council adopted the directive on the extension of the automatic exchange of information rules to digital platform operators (DAC7)

On March 22, 2021, the European Council adopted the amendment to the Directive on administrative cooperation in the field of taxation (DAC7), by expanding the scope of automatic exchange of information to sales through digital platforms too. The new rules will apply starting with 1 January 2023

On February 26, 2021, the Government Emergency Ordinance no. 13/2021 was adopted to amend and supplement Law no. 227/2015 on the Tax Code and the Accounting Law no. 82/1991, taking into account the need to make legislative correlations in order to ensure the unitary application of tax regulations.

I. New Labour Code provisions on the suspension or temporary reduction of the employer's activity, introduced by Law no. 298/2020
On December 24, 2020, Law no. 298 supplementing Law no. 53/2003 – the Labour Code was published in the Official Gazette no. 1293/24.12.2020.
II. The Government has extended the applicability of some support measures granted in the context of the epidemiological situation caused by the spread of SARS-CoV-2 coronavirus
On December 31, 2020 Emergency Ordinance no. 220/2020 on the application of social protection measures after January 1, 2021 in the context of the spread of the SARS-CoV-2 coronavirus, as well as for the amendment of some normative acts was published in the Official Gazette no. 1326/31.12.2020.
III. The work permits quota for foreign workers admitted to the labor market in 2021 was established
On December 31, 2020 Decision no. 1133/2020 on establishing the work permits quota in 2021 was published in the Official Gazette no. 1326/31.12.2020.
IV. New fiscal provisions brought by the Emergency Ordinance no. 226/2020
On December 31, 2020 Emergency Ordinance no. 226/2020 on certain fiscal - budgetary measures and for amending and supplementing certain normative acts, as well as for the extension of certain deadlines was published in the Official Gazette no. 1332/31.12.2020.

New amendments published on Law no. 227/2015 regarding the Fiscal Code and Law no. 207/2015 regarding the Fiscal Procedure Code
On December 21, 2020 the Law no. 295 for the amendment and completion of Law no. 207/2015 on the Fiscal Procedure Code, as well as Law no. 296 for the amendment and completion of Law no. 227/2015 regarding the Fiscal Code were published in the Official Gazette no. 1266 and no. 1269/21.12.2020.
The current form published in the Official Gazette does not bring substantial changes compared to the drafts of the two Laws. Among the most important regulated aspects are the following:
o aspects related to the definition of certain terms, the corporate income tax, the value added tax, excise duties, the microenterprise tax, the tax on the income obtained in Romania by non-residents or local taxes and duties.
o tax procedure aspects, out of which the most important aspect were in legislative procedure for more than 3 years.
News regarding social protection and supporting measures for employees and employers in the context of the epidemiological situation caused by the spread of SARS-CoV-2 coronavirus
On December 7, 2020, the Government Emergency Ordinance no. 211/2020 regarding the extension of the application of some social protection measures adopted in the context of the spread of the SARS-CoV-2 coronavirus, as well as for the amendment of the Government Emergency Ordinance no. 132/2020 on support measures for employees and employers in the context of the epidemiological situation caused by the spread of SARS-CoV-2 coronavirus, as well as to stimulate employment was published in the Official Gazette no. 1189/12.07.2020 (“GEO no. 211/2020”).
In addition, on December 9, 2020, the Law no. 282/2020 for the approval of the Government Emergency Ordinance no. 132/2020 on support measures for employees and employers in the context of the epidemiological situation caused by the spread of SARS-CoV-2 coronavirus, as well as to stimulate employment growth it was published in the Official Gazette no. 1201/09.12.2020 (“Law no. 282/2020”).
The above-mentioned documents a establish the extension of the application of certain forms of financial support to employers, employees, as well as to other categories of individuals affected by the current epidemiological situation, but also some amendments ad completions regarding the method of granting.
OECD Guidance on the transfer pricing implications of the Covid-19 pandemic
On December 18th, on the OECD website it was published a report on the transfer pricing implications of the Covid-19 pandemic (hereinafter referred to as 'OECD Guidance'). The OECD Guidance provides comments on the application of the arm’s length principle in the pandemic context in four priority issues: (i) performing the comparability analysis; (ii) losses and allocation of Covid-19 specific costs; (iii) treatment of government assistance programs; and (iv) implications of the Covid-19 pandemic on advance pricing agreements.
The report states that these comments should be treated in close connection with the OECD Guidelines , not as a replacement/revision of the latter. Therefore, tax authorities and taxpayers should continue to follow also the provisions of the OECD Guidelines.
Below there is a summary of the main provisions included within the document issued by OECD.

The Parliament of Romania adopted two draft laws for the amendment of the Fiscal Code and the Fiscal Procedure Code

On November 24th, 2020, the Chamber of Deputies adopted the Draft Law PL-x 478/2019 for the amendment and completion of Law no. 227/2015 regarding the Fiscal Code and the Draft Law PL-x 477/2019 for the amendment and completion of Law no. 207/2015 on the Fiscal Procedure Code and Law no. 227/2015 on the Fiscal Code, as well as for the approval of some fiscal and budgetary measures.
These draft laws mainly concern aspects related to the definition of certain terms, the corporate income tax, the value added tax, excise duties, the microenterprise tax, the tax on the income obtained in Romania by non-residents or local taxes and duties, as well as tax procedure aspects, out of which the most important aspect were in legislative procedure for more than 3 years.

The Government regulates the residence and entry rights in Romania applicable in case of a Brexit with Agreement

On November 25, 2020, the Emergency Ordinance no. 204/2020 on the establishment measures for the implementation of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community, regarding the regulations of the entrance right and stay in Romania was published in the Official Gazette no. 1132/25.11.2020.

The National Agency for Fiscal Administration approved the procedure for granting payment rescheduling by the central fiscal body

On November 19, 2020, the Order no. 3.896 of the president of the National Agency for Fiscal Administration for the approval of the Procedure for granting the payment rescheduling by the central fiscal body, as well as for the modification of annex no. 2 of the Order of the president of the National Agency for Fiscal Administration no. 90/2016 for the approval of the content of the application for granting the payment rescheduling and of justifying documents attached to it, as well as of the Procedure for applying the payment rescheduling by the central fiscal body was published in the Official Gazette no. 1104/11.19.2020.

Amendments to the Tax Code made by Law no. 239/2020
On 6 November 2020, the Law no. 239/2020 for amending and completing the Law. 227/2015 regarding the Tax Code was published in the Official Gazette no. 1041/06.11.2020.
These amendments concern provisions related to corporate income tax and personal income tax, which have entered into force on November 9, 2020. Thus, a series of regulations are introduced regarding the income and expenses resulting from early education and from vocational and technical education, dual pre-university and university education.

The Government has adopted new support measures in the context of the epidemiological situation caused by the spread of the SARS-CoV-2 coronavirus
On October 26th, 2020, the Emergency Ordinance no.181 on certain fiscal-budgetary measures, for amending and supplementing regulatory acts and for the extension of certain deadlines (""EGO 181/2020"") was published in Official Gazette No. 988/26.10.2020.
Among the most important issues covered by EGO 181/2020 are the following:

• New provisions on payment facilitation (payment rescheduling) for budgetary obligations due from the date of the declaration of the state of emergency (March 16th 2020), administered by the central fiscal body;

• Exemption for the specific HoReCa tax due until December 31, 2020;

• Extension of the deadline by which the public authorities may grant reductions and / or exemptions regarding the tax on buildings;

• Suspension of the application of the fine for not connecting the electronic cash registers with the computer system of the National Agency of Fiscal Administration (“NAFA”);

• Extension of the term regarding the restructuring of the tax obligations provided by GO 6/2019;

• Favourable tax treatment applicable to COVID-19 tests;

• Extension of some legal deadlines, in order to continue the package of measures adopted due of the pandemic effects on the economy.

Individuals who do not have the quality of pensioners can obtain the retirement pension by paying the social insurance contribution for periods of maximum 6 years
New measures for crossing the Romanian state border by frontier workers
These legislative news have been published in the Official Gazette no. 883, no. 884 from September 2020.

New exemptions applicable to foreign citizens regarding employment in Romania
Approval of the amounts settlement procedure for the indemnity payment related to granting days off for parents in order to supervise children, in case of limitation or suspension of teaching activities, following the spread of SARS-CoV-2
Publication of the methodology for granting the financial support to employees and employers in order to purchase goods in the context of the epidemiological situation
Extension of the state of alert on the Romanian territory starting with September 15, 2020
Publication of the document templates necessary for approving the settlement and payment procedure of the amounts granted as support for employees and employers in the context of the epidemiological situation
These legislative news have been published in the Official Gazette no. 832, no. 836, no. 842 and no. 850 from September 2020.

Fiscal measures in order to stimulate the maintenance / increase of equity, as well as for the completion of certain normative acts
Throughout Friday, 4th of September 2020, it was published in the Official Gazette no. 817, the Government Emergency Ordinance (“GEO”) no. 153/2020 for the establishment of certain fiscal measures in order to stimulate the maintenance / increase of equity, as well as for the completion of certain normative acts.
According to the GEO, it is targeted the reduction of corporate income tax/ microenterprise tax/ specific tax depending on the level of equity/ annual increase of equity. Moreover, certain completions are brought to the Government Emergency Ordinance no. 33/2020 regarding certain fiscal measures in relation to allowances granted for the year 2020 towards taxpayers subject to corporate income tax.

The publishing in the Official Gazette of the Emergency Ordinance for granting days off for parents in order to supervise children, in case of limitation or suspension of teaching activities that require the presence of children in schools and early childhood education units, following the spread of SARS-CoV-2 coronavirus.
The publishing in the Official Gazette of the Decision for the approval of the procedure for settlement and payment of the amounts granted based on the Government Emergency Ordinance no. 132/2020 on support measures for employees and employers in the context of the epidemiological situation caused by the spread of the SARS-CoV-2 coronavirus, as well as to stimulate employment growth.
These legislative news have been published in the Official Gazette no. 790 from August 28, and respectively no. 794 from August 31.

Amendments to the Local Sales and Purchases List return “Informative declaration regarding the deliveries / services and acquisitions made on the national territory by the persons identified for VAT purposes”

On August 21, 2020, the Order of the President of NAFTA no. 3281/2020 amending the Order of the President of NAFTA no. 3769/2015 was published in the Official Gazette of Romania no. 764, Part I.

The law for amending and supplementing Law no. 16/2017 on posting the employees in the framework of the transnational provision of services, as well as the decree for its promulgation, was published in the Official Gazette
The amendment of this Law was published in the Official Gazette no. 736 from August 13, 2020.

New support measures in the context of the epidemiological situation caused by the spread of SARS-CoV-2 coronavirus

On August 10, 2020 Emergency Ordinance no. 132/2020 for the establishment of certain support measures for employees and employers in the context of the epidemiological situation caused by the spread of the SARS-CoV-2 coronavirus, as well as for increasing the employment (hereinafter “GEO 132/2020”) was published in the Official Gazette no. 720/10.08.2020.

Among the most important aspects, the normative act provides additional forms of financial support to employers and employees, as well as for other categories of individuals affected by the current epidemiological situation.

A new postponement of the deadline for submitting paper tax returns towards the Environmental Fund Administration, new criteria applicable to biodegradable transport bags and fiscal amnesty for contributions towards the Environmental Fund Administration
This week, the Environmental Fund Administration has posted a new deadline for submitting paper tax returns. The new deadline is the 25th of October 2020 for reporting September 2020.
On the 29th of July 2020 came into force the provisions of Order of Environment, Waters and Forestry Ministry no. 1276/2020 regarding the approval of technical characteristics applicable to transport bags manufactured from materials that comply with SR EN 13432:2020 for which the eco-tax does not apply.
Companies that register fiscal obligations towards the Environmental Administration Fund can apply for amnesty for the accessories deriving from their main tax obligations.

Tax credit for electronic cash registers purchased starting with 2018

On Friday, July 24, 2020, Law no. 153 for the amendment and completion of Law no. 227/2015 on the Fiscal Code, as well as for completing Law no. 170/2016 regarding the specific tax, was published in the Official Gazette no. 659.
According to this law, taxpayers paying corporate income tax, microenterprise tax, specific tax or income tax benefit of tax credit for the acquisition cost of the electronic cash registers purchased and put into operation starting with August 1, 2020. The tax credit applies, as well, for the electronic cash registers purchased and put into operation during 2018, 2019 and 2020 before this the entry into force of this law.

Procedure for the annulment of ancillary payment liabilities

In the context of the tax measures adopted by the authorities in May by GEO 69/2020, aiming to support taxpayers in overcoming the problems caused by COVID-19, Order no. 2.100 of the Minister of Public Finance for the approval of the Procedure for the annulment of ancillary payment liabilities was published on July 20, 2020.
Thus, the Procedure for the annulment of ancillary payment liabilities, implements the mechanism previously established by GEO 69/2020, regulating among others, the following aspects:
- The debtors who can benefit from these tax facilities;
- The categories of outstanding ancillary liabilities that may be subject to the annulement;
- The steps that must be followed in order to benefit from the tax facilities;
- Particular situations of the debtors.

Important ammendments brought to Order 103/2016 on justifying the application of VAT exemptions

The amendments brought to the Order 103/2016 on July 17, 2020 aim to align the national legislation with the European rules applicable since January 1 for the intra-community transactions with goods, to correlate the VAT rules for exports with the customs provisions, as well as implementing certain CJEU rulings on VAT exemptions.
In brief, the amendments are addressing the following issues:
- implementation of new rules in order to justify the european transport in case of intra-EU supplies of goods;
- alignment of rules for applying the VAT exemption for exports with the customs rules;
- extension of the period during which the documents necessary justifying VAT exemption can be obtained  from 90 to 150 days;
- clarifying certain VAT exemptions as a result of recent cases judged at the Court of Justice of the European Union (CJEU).

DAC 6 – Romania adopted the extension with 6 months of the reporting deadlines and of the mandatory and automatic exchange of information in the tax field
On July 1, 2020, Emergency Ordinance no. 107/2020 was published in the Official Gazette no. 579, amending certain provisions of Ordinance no. 5/2020, by extending with 6 months the reporting deadlines of the transactions with tax risks, imposed following the implementation of (EU) Directive 2018/822 in Romania.

I. Amendments to the legislation for the introduction of fiscal measures, amendments of legislative acts and deadlines extensions in the context of COVID-19
On June 25, 2020, the Emergency Ordinance no. 99/2020 for the implementation of fiscal measures, amendments of legislative acts and the deadlines extension (“GEO no. 99/2020”) was published in the Official Gazette.

II. The postponement of the reporting deadlines established by the (EU) Directive no. 2018/822 (“DAC 6”, “Directive”)
On June 24, 2020, the EU Council reached an agreement (through (EU) Directive 2020/876) regarding the optional 6-month postponement of the reporting deadlines established by the (EU) Directive no. 2018/822 as regards the automatic exchange of information in the field of taxation in relation to reportable cross-border arrangements, whereby the member states may opt for the delay of the reporting deadlines until the beginning of 2021.

I. New rules regarding the yearly visa applicable to environmental authorizations and integrated environmental authorizations
Order 1150/2020 brings, through the approval of the Procedure for the application of the yearly visa, new legal obligations with high impact on businesses that operate under environmental authorizations and integrated environmental authorizations.

II. CJEU clarifies the rules applicable to the distribution of samples free of charge to persons qualified to prescribe or supply them
The Court of Justice of the European Union (“CJEU”) ruled under Decision C-786/18 (“the Decision”) for a preliminary ruling, that in the matter of marketing of medicinal products, more specifically in the case of distribution of samples free of charge, pharmaceutical companies are not allowed to distribute free samples of prescription-only medicinal products to pharmacists.

I. Order no. 456/2020 regarding the procedure for granting the amounts provided by art. III, par (1) and (2) of Government Emergency Ordinance 92/2020 for the establishment of active supporting measures for employees and employers, in the context of the epidemiological situation caused by the spread of SARS-CoV-2 coronavirus, was
published in the Official Gazette.

II. G.E.O. 97/2020, for the implementation of administrative simplification measures in the field of social protection, as well as for granting social assistance rights and benefits in
the areas of activity in which restrictions are maintained was published

III. Order of National Agency for Fiscal Administration (ANAF) for the approval of the Procedure for connecting the fiscal electronic cash registers to the national computer system for supervision and monitoring of the fiscal data of ANAF

I. Amendments to the legislation for the introduction of measures to restructure the outstanding budgetary obligations and certain fiscal facilities

II. The Government has adopted new support measures for employees and employers in the context of the epidemiological situation caused by the spread of SARS-CoV-2 coronavirus

III. Order issued by Romanian tax authorities for approval of the annual tax return due by individuals and other changes regarding the declaration of private income.

IV. Law no. 62/2020 regarding the implementation of rent payment facilities during the state of emergency period.

I. Legislative measures adopted in the context of the COVID-19 pandemic
On 21 May 2020 the Law no. 62/2020 on the application of rent payment facilities for the period
related to the state of emergency (""Law no. 62"") was published in the Official Gazette no. 425.

II. Amendments to form 112
On 21 May 2020 the new template of the form 112 - “Declaration regarding the payment liabilities of
social security contributions, income tax and the record of insured individuals” was published in the
Official Gazette no. 426.

I. The authorities have implemented certain tax measures in order to help the taxpayers get through the problems caused by the COVID-19 pandemic

II. The authorities have extended certain measures for social protection, have issued norms for the regulation of the right to stay in Romania for foreign individuals, starting with May 15, 2020, in the context of the epidemiological situation determined by the spread of the SARS-CoV-2 coronavirus.

III. The authorities have instituted new measures for the prevention and control of infections, applicable during the state of alert

The authorities intend to implement certain tax measures in order to help the taxpayers get through the problems caused by the COVID-19 pandemic
As mentioned by the representatives of the authorities, as well as following the press releases after the Government meeting from May 7, 2020, the Romanian Government intends to implement several measures aimed to provide certain tax facilities for taxpayers, in order to combat the problems caused by the COVID-19 pandemic.

Legislative measures undertaken in the context of the COVID-19 pandemic
On April 16, 2020, in the Official Gazette of Romania, part I, the Government Emergency Ordinance no. 48 (“GEO no. 48/2020”) was published, regulating certain financial – fiscal measures.

New Regulation no. 7/2020 (the “Regulation”) issued by the Financial Supervisory Authority (“FSA”) on the authorisation and functioning of alternative investment funds

Payment moratorium under EGO 37/2020 and the related implementation rules: key procedural steps, conditions, matters still open to debate and practical issues

Ordinance for amending the Law regarding the paid leave granted for parents for supervising their children during the temporary period in which the learning institutions are closed
A new Ordinance amending Law 19/2020 was published in the Official Gazette no. 282 from April 3, 2020.

Main amendments brought to the Law no. 19/2020:
Free days are granted to one of the parents for the supervision of the children during the school holidays period too, in case of the temporary closure of the learning institutions during emergency state;
Pre-school learning institutions are also included for granting paid leave;

Legislative measures adopted in the context of COVID-19 pandemic
I. Emergency Ordinance no. 33/2019 on certain fiscal measures and the amendment
of certain normative acts
II. Emergency Ordinance no. 32/2020 on the amendment and completion of
Emergency Ordinance no. 30/2020 amending certain normative acts, as well as for
establishing several measures regarding social protection given the epidemiologic
situation derived from SARS-CoV-2 spreading
III. Emergency Ordinance no. 35/2020 on the method of issuing and extending the
validity of holiday vouchers, in the context of the epidemiological situation
determined by the spread of COVID-19
IV. Order no. 499/2020 for approving the temporary suspension of the distribution
outside the Romanian territory of biocidal products used to ensure the prevention of
the diseases associated with the infection with SARS-CoV-2

Legislative measures adopted in support of companies affected by COVID-19 pandemic
I. Emergency Ordinance no.29/2020 on economic and fiscal measures in the context of COVID-19 pandemic
II. Emergency Ordinance no. 30/2020 amending certain normative acts, as well as for establishing several measures regarding social protection given the epidemiologic situation derived from SARS-CoV-2 spreading
III. Government Decision no. 217 for the application of the provisions of Law no. 19/2020 regarding the paid leave granted for the parents for supervising their children during the period of temporary closure of the educational units

Measures adopted by the Environmental Fund Administration in the context of the COVID-19 pandemic
Given the difficult situation that the economic operators are facing in the context of the spread of infection with SARS-CoV-2 on the Romanian territory, the Environmental Fund Administration (“EFA”) has adopted a series of measures supporting the business environment.

CJEU decision with a potential impact on companies from various industries: VAT is due on the reimbursement of the costs related to the secondment of staff by the parent company to its subsidiary

Law regarding the paid leave granted for the parents for supervising their children, during the period in which the learning institutions are closed

Proposal for amending Order 103/ 2016 on justifying the application of VAT exemptions
On February 20, on the Ministry of Public Finance’s website, a proposal of the Romanian tax authorities for amending and updating Order 103/2016 regarding the methods for justifying the VAT exemptions applicable for intra-Community supplies of goods and exports was published. Briefly, the draft order provides:
- implementation of new rules in order to justify the european transport in case of intra-EU supplies of goods;
- alignment of rules for applying the VAT exemption for exports with the customs rules;
- extension of the period during which the documents necessary justifying VAT exemption can be obtained  from 90 to 150 days;
- clarifying certain VAT exemptions as a result of recent cases judged at the Court of Justice of the European Union (CJEU).

OECD published the Transfer Pricing Guidance on Financial
Transactions

On February 11, 2020, OECD published the Transfer Pricing Guidance on
Financial Transactions. It complete the BEPS: Actions 4, 8-10, being transposed
as a new chapter in the OECD Transfer Pricing Guide, Chapter X. 

The Authority for the Digitalization of Romania.
Revitalization of public administration modernization?

Thursday, February 13, 2020, Government Decision no. 89/2020 regarding the
organization and functioning of the Authority for the Digitalization of Romania
(“ADR”) has been published in the Official Gazette of Romania. The new
authority shall assume the role of carrying out and coordinating the
implementation of public policies and strategies regarding the digital
transformation of public administration.

DAC 6 – The implementation of Directive 2018/822 regarding the mandatory and automatic disclosure of information in the tax field with regards to cross-border arrangements, which are subject to reporting
On January 31, 2020, Emergency Ordinance no. 5/2020 was published in the Official Gazette no. 68/31.01.2019, bringing a series of changes to Law no. 207/2015 regarding the Tax Procedural Code.

Amendment of Government Ordinance no. 6/2019 regarding the establishment of tax debt restructuring
On January 31, 2020, Emergency Ordinance no. 6/2020 was published in the Official Gazette no. 72/31.01.2019, bringing a series of changes to tax debt restructuring legislation.

The deadline for the submission of the annual tax return and the payment of the related tax obligations has been extended

BREXIT: immigration and social security implications

Changes of the Fiscal Code
On 31st of January, 2020 on Official Gazette no. 72 was published Government Ordinance 6/2020 for implementing in the Tax Code the „VAT quick fixes” agreed by the European Union, and also the provisions related to Directive 2017/952 on hybrid tax mismatches that occur in cross-border transactions.

BREXIT at midnight: Customs, VAT and Excise implications
On January 31, 2020, 00:00 The United Kingdom of Great Britain and Northern Ireland leaves the Customs Union and the Single Market of the European Union.
The BREXIT agreement was approved by the European Parliament, the Council of the European Union and the Parliament of the United Kingdom

Changes regarding the method of declaring to the Environmental Fund
The year 2020 brings new obligations for economic operators with respect to submitting the monthly declarations to the Environmental Fund Administration.

Approval of the Romanian annual tax return form to be used in 2020

Emergency Ordinance no. 1/2020 regarding certain fiscal and budgetary measures, as well as modifying and completing some normative acts

The average monthly gross salary income for 2020
The value of the national average gross salary used for establishing the social security state budget for year 2020 is RON 5,429.

Law on occupational private pensions
It is regulated the legal framework necessary for setting up occupational private pension schemes and occupational private pension funds.

The 222 and 224 forms can now be submitted online
Starting with December 17, 2019, forms 222 and 224 regarding the individuals who obtain salary income from abroad for activities performed in Romania, can be submitted to the relevant authorities in electronic version.

The new Law no. 243/2019 on alternative investment funds will enter into force in January 2020

The Government Decision regarding the quota for work authorizations that can be issued for foreigners, for the year 2020, was published

Amendments brought to the Fiscal Code regarding the mandatory social security contributions due by individuals

Law on the amendment of Company Law no. 31/1990 regarding the sole shareholder of a limited liability company (in Romanian “societate cu răspundere limitată” or “S.R.L.”) and the registered office – subject to promulgation

Measures approved by the Government in case of a no-deal Brexit

On November 20, the Emergency Ordinance  no. 70/2019 regarding some measures applicable in the case of retreat of the United Kingdom of Great Britain and Northern Ireland from the European Union (“UK”) without an agreement was published in the Official Gazette no. 933/20.11.2019.

Special tax regime applicable to the activities of the Final Tournament of the European Football Championship 2020

The Government approves the Emergency Ordinance no. 18 of March 19, 2019 which provides that the individuals and legal persons involved in the organization of the Tournament benefit from certain tax exemptions from the provisions of the Law no. 227/2015 regarding the Tax Code.

NAFA provides the procedure for establishing ex officio the annual income tax due by individuals

On November 6, the Order no. 2862/2019 of the President of the National Agency for Fiscal Administration was published in the Official Gazette no. 897/06.11.2019, for the approval of the procedure regarding the ex officio establishment of the annual income tax due by the taxpayers (i.e., individuals), as well as the model and content of certain forms.

New obligations for the economic operators involved in trading operations with manufactured tobacco products 

Starting with October 31, 2019, the traceability system for manufactured tobacco products (i.e. cigarettes, rolling tobacco) has become operational.  

For the other tobacco products, this traceability system will be functional starting with May 20, 2024.

New amendments performed to Law no. 50/1991 regarding the authorization of construction works

Law no. 193/2019 for the amendment and completion of Law 50/1991 regarding the authorization of construction works has been promulgated by the Romanian President and published in the Official Gazette no. 873/ 30 October 2019.

New EORI obligations for Romanian branches of non-EU companies performing export operations

CJEU rejects the VAT exemption for services rendered in connection with the operation of ATMs

The Court of Justice of the European Union (CJEU) ruled, as per a decision of October 3, 2019 (Case C-42/18 - Cardpoint), that the VAT exemption for payment services is not applicable in the case of a supplier that provides ATM operating services to a bank.

Amendments brought to form 112

On October 1, 2019, the new model, contents, method of submission and management of the “Declaration regarding the payment liabilities of social security contributions, income tax and the record of insured people” was published in the Official Gazette no. 794/01.10.2019 (“Form 112”).

The procedure for establishing ex officio the social security contributions due by individuals who derive income from sources other than the salary income

On October 2, 2019, the Order of the President of the National Agency for Fiscal Administration was published in the Official Gazette no. 800/02.10.2019, for the approval of the procedure regarding the ex officio establishment of the social security contributions due by individuals, as well as the model and contents of certain forms.

Emergency Ordinance for amending and supplementing Government Ordinance no. 6/2019 regarding the establishment of tax facilities 

On September 26, 2019, the Emergency Ordinance amending Government Ordinance no. 6/2019 regarding the establishment of fiscal facilities ("GO 6/2019") was published in the Official Gazette no. 784/26.09.2019. This provides for the extension of the deadline for submitting the notification regarding the intention to restructure the budgetary obligations from September 30 to October 31, 2019, and brings a number of further clarifications on some aspects related to GO 6/2019.

The Procedure for the annulment of ancillary payment obligations

On September 27, 2019, the Procedure for the annulment of ancillary payment obligations was published in the Official Gazette no. 786/27.09.2019, in accordance with chapter II of Government Ordinance no. 6/2019 regarding the establishment of tax facilities.

Draft law on decapitalised companies

At the beginning of September, the Romanian Senate was referred to, with a new draft law imposing, inter alia, certain measures on decapitalized companies.

Amendment to the manner of applying the fines in case of breach of the legal provisions regarding overtime

On September 18, 2019, the Chamber of Deputies adopted the Law amending art. 260 para. (1) letter i) of the Law 53/2003 – Labour Code as follows: "Constitutes a minor offence and is sanctioned with a fine ranging from RON 1,500 to RON 3,000 the non-compliance with the provisions regarding the overtime for each person identified as performing overtime."

The Ministry of Public Finance targets decapitalised companies

On August 14, 2019, the Ministry of Public Finance published a government ordinance project, proposing amendments to Companies Law no. 31/1990 and to Accountancy Law no. 82/1991. These revisions propose drastic measures for the companies that register a decrease of the net asset or losses.

The procedure for applying the measures to restructure the outstanding tax liabilities as at December 31, 2018, in case of taxpayers having debts greater than or equal to RON 1 million  

On August 29, 2019, the procedure for applying the measures to restructure the outstanding tax liabilities as at December 31, 2018, in case of taxpayers having debts greater than or equal to RON 1 million was published in the Official Gazette no 711/29.08.2019. The procedure brings a series of clarifications and details over some aspects from the Government Ordinance no. 6/2019 (“GO 6/2019”).

Decision to supplement the quota for work authorizations that can be issued for foreigners during 2019

On August 30, 2019, has been published the Government Decision increasing the quota for work authorizations that can be issued for foreigners during 2019.

New rules on consumer information regarding the extension of promotional campaigns/clearance sales

On August 30, 2019, the National Consumer Protection Authority has released in public consultation a Draft Order on consumer information requirements applicable to economic operators that continue to place on the market the products that were the subject of promotional campaigns/clearance sales, on the territory of Romania.

Government Ordinances drafts regarding the modification of the Fiscal Code and the Fiscal Procedure Code

Government Ordinance draft for completing the Government Emergency Ordinance no. 28/1999 on the obligations of economic operators to use electronic cash registers for tax purposes

According to the information presented on the website of the Ministry of Public Finance, it is foreseen the publication of two emergency ordinances by which legislative changes will be made, regarding the Fiscal Code and the Fiscal Procedure Code.

Moreover, the Government Emergency Ordinance no 28/1999 is foreseen to be modified.

Thus, on August 14, 2019, three projects were published as following:

  • The Government Ordinance project for updating the Government Emergency Ordinance no. 28/1999 on the obligations of economic operators to use electronic cash registers for tax purposes;
  • The Government Ordinance draft for amending and supplementing Law no. 227/2015;
  • The Government Ordinance draft for amending and supplementing Law no. 207/2015.

In the design of the two emergency ordinances that will produce changes in the two codes, Fiscal and Fiscal Procedure, the date of entry into force of these normative acts would be set, generally speaking, on January 1, 2020.

Amendment of the Companies’ Law no. 31/1990

On August 5, 2019, Law no. 162/2019 regarding the amendment of art. 6 paragraph (2) of the Companies’ Law no. 31/1990 (“Companies’ Law”) entered into force. The amendment regards the limits set in relation with the association right in order to carry out economical activities. More specifically, the limits in relation to a person who can be a founder of a company registered in accordance with the Romanian law have been modified.

Regulation on promoting fairness and transparency for business users of online intermediation services

On July 31, 2019, Regulation (EU) 2019/1150 of the European Parliament and of the European Council on promoting fairness and transparency for business users of online intermediation services entered into force (the “Regulation”).

Ordinance regarding the granting of tax facilities

On August 5, 2019, Ordinance no. 6 was published in the Official Gazette. It regards the granting of certain tax facilities, including the possibility of restructuring the tax liabilities for taxpayers in financial difficulty (i.e. insolvency risk), as well as the cancellation of several interest and penalties for late payment subject to the conditions provided by the Ordinance.

The current facilities are more advantageous than other reliefs provided by the Fiscal Procedure Code.

Amendments to the legislation regarding the threshold applied for the sponsorships credit

On July 26, 2019 the Law no. 156/2019 was published in the Official Gazette, amending para. (4), letter i) of art. 25 of the Law 227/2015 regarding the Tax Code.

New non-harmonized excise duty for soft drinks with high sugar content

The Ministry of Public Finance has published a draft emergency ordinance establishing a new excise duty for soft drinks with a high content of free sugars.

Increase of excise duty on cigarettes starting September 1, 2019

New amendments regarding Companies’ Law no. 31/1990 and Government’s Ordinance no. 26/2000 regarding associations and foundations

On July 21st, 2019 Law no. 129/2019 (“Law 129/2019”) regarding the prevention and the fight against money laundering and financing of terrorism, entered into force, as well as the amendments of other normative acts, which, among other changes, it modifies Companies’ Law no. 31/1990 and Government’s Ordinance no. 26/2000 regarding associations and foundations.  

Amendments to the Urbanism Law regarding the litigations initiated with respect to the urbanism documentations    

On July 26, 2019, Law no. 151/2019 that supplements Law no. 350/2001 on urbanism and improvement of territory (”Law 151/2019”) was published in the Official Gazette. The normative deed entered into force on July 29, 2019.

Although the majority of the amendments refer to the regulation of the informal settlements of underprivileged individuals, there are several important changes, which concern the legal regime applicable to litigations initiated with respect to urbanism documentation.

Amendments to the legislation on cash registers

Law published on 17th of July for repealing par. (1), (2) and (4) of art. 40 of the Government Ordinance no. 27/2011 on road transport, as well as for amending and completing Government Emergency Ordinance no. 28/1999 on the obligations of economic operators to use fiscal electronic cash registers.

Furthermore, a legislative proposal was put forward in order to eliminate the contravention regarding the non-observance of the deadlines stipulated by the GEO 28/1999, to use electronic cash registers, from under the provisions of the Prevention Law no. 270/2017.

Approval of the Administrative Code – amending the legal regime of the public and private ownership held by the state and the administrative-territorial units

On July 5, 2019 the Emergency Government Ordinance no. 57/2019 (“GEO 57/2019”) regarding the Administrative Code was published in the Official Gazette. The legislative deed entered into force on the same day, with the exception of several provisions for which a subsequent date of entry into force was expressly indicated. Although the Administrative Code mainly contains provisions on the organization and operation of the public authorities, there are several important amendments set forth with respect to the legal regime of the private and public ownership held by the Romanian state or by the administrative-territorial units (“UAT”).

Regulation of the alternative transportation activities

On July 4, 2019, the Government’s Emergency Ordinance no. 49/2019 (“GEO 49/2019”) regarding the alternative transportation activities entered into force. GEO 49/2019 regulates the activity of digital platforms, which offer ride-sharing services, but also the activity of the drivers that offer transportation services registered on such platforms.

Guidelines adopted by the European Data Protection Board 

Substantial changes in relation to the management of packaging waste and the contributions to the Environmental Fund

Government Emergency Ordinance No. 50/2019 ("GEO 50/2019”), which brings important changes to the legislation regarding packaging waste and the contributions to the Environmental Fund, was published in the Official Gazette on July 2nd, 2019, and entered into force on the same day. GEO 50/2019 amends and completes GEO No. 196/2005 regarding the Environmental Fund and Law No. 249/2015 regarding the management of packaging and packaging waste.


The online filing of the tax returns that are due to the Environmental Fund has been regulated

Order of the Minister of the Environment No. 572/2019 ("Order 572/2019"), which regulates the conditions for submitting online the tax returns to the Environmental Fund, was published in the Official Gazette on 3 July 2019 and entered into force on the same day.

New rules regarding the registration of entities that manufacture, import or distribute active substances used as raw materials for medicinal products for human use

On June 11, 2019, the Order no. 775/2019 (“the Order”) of the Ministry of Health on the registration of manufacturers, importers and distributors of active substances used as raw materials for medicinal products for human use was published in the Official Gazette, Part I, no. 473.

New criteria for the exemptions provided under the Agricultural Cooperative Law no. 566/2004

According to Order No. 1369/2019, published in the Offical Gazette on June 12, 2019, the procedure for granting tax incentives for the electronic submittal of the “Unique tax return on income tax and social security contributions due by individuals”, as well as for the payment in advance of estimated tax liabilities for the year 2018 has been approved

Proposal to amend VAT treatment in case of leasing transactions

During the Government meeting on the 12th of June 2019, it was duly noted the proposal to amend the Tax Code in order to bring national legislation in line with the Court of Justice of the European Union’s (CJEU) decision in Case C-164/16 Mercedes-Benz, according to which (financial) leasing operations constitute supplies of goods.

Draft law on public procurement and concessions

The National Public Procurement Agency has proposed a draft law with respect to the public procurement and concessions legislation.

Amendments brought in the Energy Industry

Order amending and supplementing the Order of the President of the National Regulatory Authority for Energy no. 18/2019, for the approval of the Methodology regarding the computation and establishment of the annual contribution stipulated in art. 2 par. (3^1) of the Government Emergency Ordinance no. 33/2007 on the organization and functioning of the National Regulatory Authority for Energy

Order amending the Methodology used for establishing the fees for the system service, approved through the Order of the President of the National Energy Regulatory Authority no. 45/2017 and suspending the applicability of certain provisions in the electricity sector

Order amending and supplementing the annex to the Order of the President of the National Regulatory Authority for Energy no. 41/2019 regarding the approval of the Methodology for the establishment of regulatory fees for natural gas transport services and for suspending the applicability of certain provisions in the natural gas sector

Order amending and completing the Order of the President of the National Energy Regulatory Authority no. 217/2018 regarding the approval of the Methodology for setting the regulated fees for gas distribution services

Order amending and completing the Order of the President of the National Energy Regulatory Authority no. 14/2019 regarding the approval of the Methodology for setting the regulated fees for the provision of underground natural gas storage services

Amendments to the Tax Code

Emergency Ordinance no. 35/2019 regarding certain modifications to normative acts was published on May 30, 2019.

Changes at European level for the legal framework applicable from the perspective of consumer protection for contracts for the sale of goods and supply of digital content and digital services

On the 22nd of May, 2019, a legislative package containing a Directive concerning contracts for the supply of digital content and digital services, and a Directive concerning contracts for the sale of goods was published in the Official Journal of the European Union.

The new package aims to adapt the European legislation to the current realities, for the purpose of increasing the level of protection granted to consumers, both for the purchase of goods and for the lawful accessing (either by paying a price, or by supplying personal data) of digital content or digital services.

Amendments to the Tax Code

On May 23th 2019, the Emergency Ordinance supplementing Law 227/2015 on the Tax Code was published. The applicability of the reduced VAT rate of 5% was extended to mountain, bio and traditional food. The amendment enters into force as of  June 1st, 2019.

Amendments to fiscal legislation

On May 23th 2019, the Emergency Ordinance regarding certain modifications to normative acts with reference to the health insurance contribution, due for the period 2014-2017, was published.

Contributions to the Environmental Fund: Changes regarding the management of packaging and packaging waste

The management of the contributions to the Environmental Fund has suffered some changes, referring mainly to the management of packaging and packaging waste, as per Order no. 149/2019, published on February 27.

Amendments brought to the tax return no. 112

The main amendments and clarifications for the tax return no. 112 refer to the conditions for applying the tax incentives in the construction field.

The EU alarm signal on computation of goods origin

Almost 40% of EU exporters face difficulties in performing computation of goods origin and 70% have difficulties in obtaining the supplier declaration, shows a study performed by the European Commission in 2018 on origin rules application at exporter level.

Romania risks new infringement: European Commission requests amendment of national law regarding customs debt

The European Commission decided last week to send Romania a letter of delay for requesting law amendment related to customs debt, the stage preceding the infringement procedure.

The amendments to the Tax Code and the Fiscal Procedure Code

A series of amendments, completions are introduced by Law no. 30/2019 published at January 17, 2019:

  • Additional conditions for granting sponsorships for corporate tax payers;
  • Amendments of the thresholds regarding interest deductibility and other equivalent costs;
  • The regulation of income obtained from virtual currency transfers and the tax base calculation method for this type of income;
  • The redistribution of the amount representing up to 3.5% from the income tax due on certain types of income to nonprofit entities, cult units and private scholarships;
  • Amendments on the moment when it is allowed the adjustment of the VAT taxable amount in case of the bankruptcy of the beneficiary;
  • Amendments on the application of the 5% VAT rate for the supply of residential housing as part of social policy;
  • Amendments to the Fiscal Procedure Code, establishing the legal framework applicable to the criteria according to which the taxpayers are classified as fiscal risk categories.

Approval of the “Unique statement regarding the income tax and social security contributions due by individuals” form for 2019

Draft GEO on consumer protection: proposed increase in the sanctions to be applied by ANPC

The National Consumer Protection Authority (ANPC) has issued on 14 January, on its own web-site, in a decisional transparency procedure, an emergency government ordinance proposal regarding the amendment and supplementation of certain legal enactments governing consumer protection.

EU-Japan Free Trade Agreement will enter into force on the 1st of February, 2019

Signed on 17th of July at Tokyo, the FTA will reduce or remove most part of the customs duties applicable for the trade of goods originating from the two territories. Registration in the REX system is necessary in order to be able to issue the proof of origin.

Changes regarding the management of packaging and packaging waste

On 14 January 2019 the Law on the approval of Government Emergency Ordinance no. 74/2018 was published, which brings changes to the management of packaging and packaging waste.

At the same time, on 15 January 2019, the order approving the authorization procedure, annual approval and withdrawal of the operating right of the organizations that implement the obligations of extended producer responsibility was published.

Certificates for wholesale or retail sales of energy products will become invalid starting with February 1, 2019

Economic operators who perform wholesale or retail sales of energy products (petrol, diesel fuel, lamp oil, GPL and biofuels) and who intend to continue their activity after January 31st, 2018, will have to submit a new application for authorisation, according to the new conditions established by NAFA Order no. 3236/2018.

Legislative measures with major impact, proposed by the draft GEO

A series of legislative changes with impact on the financial services, electricity, gambling, telecommunications, amongst others, are proposed through a draft of emergency ordinance, published on December 18:

  • A tax on the assets of financial institutions – “The Greed Tax” – the rate is progressive, and is determined according to ROBOR;
  • Set-up of a minimum contribution for granting and extending the licenses for telecommunications providers;
  • A new annual tax for gambling organizers;
  • Freezing of the gas selling price by 2022 to 68lei/MWh;
  • New rules for setting tariffs and contributions owed by electricity operators;
  • Increasing the financial contribution of electricity operators;
  • Indexation of local taxes and fees;
  • Tax incentives for employees in the construction sector;
  • Tax on revenues from advertising on alcohol and tobacco;
  • Substantial changes to pension pillar II.

The list of dual-use items has been updated

In order to ensure better control of exports, transfer, brokering and transit of dual-use items, an update was necessary concerning the dual-use list provided by the Council Regulation (EC) 428/2009 setting up a Community regime for the control of exports, transfer, brokering and transit of such items.

EU Regulation: Unlocking e-commerce in the European Economic Area

Regulation (EU) 2018/302 on the prevention of unjustified geoblocking and other forms of discrimination based on citizenship, nationality or domicile headquarters on the internal market entered into force on December 3rd.

The regulation removes geoblocking, which is a discriminatory practice that prevents online customers from accessing and purchasing products or services from a site based in another Member State.

VAT Rate of 5% for restaurant and catering services: Instructions to clarify the application

The instructions of uniform application try to clarify the main difference – from the perspective of a VAT rate applied (9% or 5%) – between restaurant and catering services and supply of goods operations.  Even if the instructions provide some examples, it is necessary to perform a qualitative analysis of the entire operation for the proper fit of the operations, because some uncertainties will also remain, as will be explained in this Tax Alert.

The minimum gross base wage per country shall increase and will vary depending on the study levels, starting with January 1st, 2019

The minimum gross base wage per country shall increase and will vary depending on the study levels, starting with January 1st, 2019, pursuant to Government Decision no. 937/2018, published in the Official Gazette no. 1045 of 10.12.2018.

Reauthorization of the temporary storage and customs warehouse require a customs global guarantee

In order to obtain reauthorization, the economic operators holding authorizations for temporary storage or customs warehousing will also have to obtain an authorization for using a global guarantee. The deadline for reauthorization is the 1st of May, 2019.

Lending conditions – The amendments made by the National Bank of Romania through Regulation no. 6/2018

The main amendments concern especially an extended scope of the Regulation 17/2012, new rules for determining the “total indebtedness level” of debtors (individuals) and new reporting obligations towards the National Bank of Romania (NBR). The new amendments will apply starting with 1 January 2019.

We summarized in this legal alert some of the key amendments.

The environmental authorization and integrated environmental authorization: what are the provisions of the procedure for the issuance of the annual endorsement

The procedure which regulates the conditions for the request, issuance or denial of the annual endorsement of the environmental authorization and integrated environmental authorization was recently approved by an order of the Ministry of Environment. The annual endorsement is a condition for the validity of the authorizations.

The main provisions of the procedure, as well as a series of essential aspects that are not clarified, which have significant consequences for the holders of the authorizations, are summarized below.

The Green Public Procurement Guide: minimum environmental protection requirements for certain product groups and services that are required within tender documentations

The Guide provides contracting authorities/entities with information on the minimum environmental protection requirements to be considered when preparing, in accordance with the law, the documentation for the award of contracts/green procurement framework agreements for product categories and/or existing services. The purpose of the guide is to support a potential bidder in preparing the technical and financial bid in an appropriate manner, in consideration of environmental protection conditions.

Amendments made to the immigration law concerning the right to stay and work in Romania for non-EU/EEA/Swiss citizens

Law no. 247/2018 for modifying and completing some normative acts regarding the regime of foreigners in Romania was published on November 7, 2018. The changes are in force starting November 2018 and cover the conditions to acquire residency and to work in Romania.

Draft amendment: State owned institutions will be able to benefit from exemption from excise duty for the fuel delivered in their own tanks

State owned institutions which involve the defence, the public policy, the public health, the national safety and security could be exempted from excise duty for energy products supplied directly to their own tanks in order to be used as aviation fuel. The proposal was mentioned into a draft amendment of the Methodological Norms of the Tax Code, published by the Ministry for Public Finance.

CJEU decision on annual leave. Impact over domestic regulations

Court of Justice of the European Union (“CJEU”) ruled that, in certain conditions, the right to annual leave may be lost if the employee refuses without justification to exercise this right.

European Commission warns Romania to end its VAT split payment mechanism

On November 8th the European Commission decided to send a letter of formal notice to Romania regarding VAT split payment mechanism. The Commission concluded that the Romanian measure is against both EU VAT rules (Council Directive 2006/112/EC) and the freedom to provide services (Article 56 of TFEU).

Starting January 1st, 2020, foreign companies will not be able to perform more than 3 customs operations per year, unless they are established in the European Union

A draft amendment of Order no. 2460/2016 on customs representation norms was published on the Romanian General Customs Directorate website.

The Combined Nomenclature in force in 2019

The European Commission has published the Combined Nomenclature (“CN”) applicable starting January 1st, 2019. Consequently, starting January, you will need to use the new CN codes for customs and excise operations, Intrastat declarations and for operations performed on the basis of a customs and fiscal authorisations issued on CN 2018 tariff codes.

Excisable products: On December 31, 2018 certificates for engross trading of energy products and alcoholic beverages/processed tobacco with no storage will lose their validity

According to a draft order published on the website of the General Customs Directorate, the deadline for economic agents to re-authorize under the new conditions will be extended (initially the re-authorization deadline was set for November 9, 2018).

Declaration and payment of the tax obligations for the branded packaging – official clarification

Declaration and payment of tax obligations remains the responsibility of the economic operator holding the brand for which these products (customized packaging) are designed or manufactured, and placed on the national market, including in its own shops. The situation has been clarified by the Environmental Fund Administration, through an informative note.

New rules governing the financial insurance sector

On October 1st, 2018 the Law no. 236/2018 on insurance distribution entered into force. The law transposes the provisions of Directive (EU) 2016/97 and repeals Law no. 32/2000 on the activity and supervision of intermediaries in insurance and reinsurance.

The regulations issued by the Financial Supervisory Authority (FSA) prior to October 1st, 2018 will continue to apply until the new regulations will be enacted, except for contradictory provisions, where Law no. 126/2018 shall prevail. The FSA is expected to issue in the near future implementation rules for the application of the Law no. 236/2018.

We summarized below some of the key aspects provided by Law no. 236/2018.

Amendments to Tax Code – The final form of the law

The amendments to the Tax Code proposed by the draft emergency ordinance of 29 September 2018 were published in the Official Gazette. The most relevant are: 5% VAT rate to certain services, regulations for taxpayers applying IFRS and updates on the applicable deductions for early reporting and/or payment of income tax and social contributions.

Amendments to Tax Code, proposed draft: VAT rate decreased to 5% for certain services

A draft Emergency Ordinance, released by the Ministry of Finance on September 29, proposes several amendments to the Tax Code. The most relevant are: 5% VAT rate to certain services, regulations for taxpayers applying IFRS and updates on the applicable deductions for early reporting and/or payment of income tax and social contributions.

Certain companies established outside the EU may claim VAT refunds by the end of September

Companies not established in the EU, which paid VAT on imports, and/or acquisitions of goods/services performed in Romania, are entitled to tax refund by the Romanian tax authorities if there is a reciprocity agreement concluded between the two countries. 

Risk analysis performed by the tax authorities. Formalities and implications

Considering the fact that, in the past two months, the General Directorate for the Administration of Large Taxpayers (“DGAMC”) started sending official notifications to large taxpayers regarding some risk indicators used in the risk analysis, the question arises whether these have any fiscal consequences and if it requires a formal reply from the latter.

Although the documents have, at a declarative level, a purely informative purpose and do not explicitly seek to obtain additional information/ details/ clarifications from the taxpayers, it is recommended to provide explanations on the risk indicators and clarify any possible inconsistencies.

In this way, the large taxpayers would, on one hand, demonstrate a diligent behaviour by willingness to cooperate with the tax authorities and, on the other hand, prevent a possible assignment in higher risk category with all the consequences of such assignment.

Excisable products: certificates for wholesale trading of energy products, alcoholic beverages or processed tobacco with no storage will lose their validity

Certificates for wholesale trading of energy products, alcoholic beverages or processed tobacco with no storage will lose their validity in 90 days starting with the 10th of August 2018. Within this timeframe, economic operators that have been so authorized can re-register if they hold an authorized wholesale warehouse facility.

European Commission amends the exporter definition from a customs perspective 

More than two years after the entry into force of the New Union Customs Code, the European Commission amends the exporter's definition from a customs perspective. The new definition should be less restrictive and limits the conditions to be met in order to act as an exporter to the essential requirements of the functioning of the export customs regime.

Decision of the Court of Justice of the European Union on the VAT exemption for payments and transfers

VAT exemption for payments cannot be applied to a service provider that only instructs banks to transfer sums of money.

Amendments to Law no. 217/2016 regarding the reduction of food waste. Tax implications

The enforcement of measures undertaken for the food waste prevention will become optional, according to Law no. 200/2018 for the amendment and completion of Law no. 217/2016 on the reduction of food waste, published in the Official Gazette no. 647 dated July 25th, 2018.

Additional compliance obligations for companies offering sponsorships 

Taxpayers granting sponsorship, acts of patronage or private scholarships will have the obligation to submit a new form, annually, i.e., Form 107 "Informative Statement regarding the beneficiaries of sponsorships/patronages/private scholarships", according to Order no. 1825/2018, published in the Official Gazette no. 646 dated July 25, 2018. 

Clarifications on the organization and functioning of the National Office for Centralized Public Procurement

Following the set-up of the National Office for Centralized Procurement (“NOCPP”) by way of GEO no. 46/2018, the Romanian Government brings clarifications on the organization and functioning of the NOCPP by issuing the Government Decision no. 502/2018, published in the Official Gazette no. 614 as of July 17, 2018.

Internship law, main aspects

Internship law published on July 19, 2018 within Official Gazette, settles the legal framework for the manner of performing paid internship programs for persons of at least 16 years, by this manner these persons being able to acquire, among others, the professional experience, practical skills and/or competencies. Internship Law mainly regulates the following that we underline herein below:

  • Who can be an intern?
  • What entities could conclude internship agreements?
  • Organization of internship program and internship agreement
  • Amount of internship allowance
  • Rights and obligations of hosting organization

The posting of workers in the framework of the provision of services: Main amendments brought to Directive 96/71/EC

Directive 96/71/EC on the posting of workers in the framework of the provision of services was amended by Directive 2018/957/EU, published on July 9, 2018, in order to ensure that a fair balance is struck between the freedom to provide services within the European Union, loyal competition, respectively the social protection of workers by promoting social justice.

Postponing by 2020 the contribution for failure to achieve the collection targets for electrical and electronic equipment and portable batteries and accumulators

On June 27th a law was published amending the Emergency Ordinance no. 196/2005 on the Environment Fund, which postpones until 2020 the payment of the contribution for failure to achieve the collection targets both by economic operators placing on the market electrical and electronic equipment and portable batteries and accumulators, as well as for the collective organizations.

The Constitutional Court upheld: Women can request the continuation of their individual employment agreements until they reach the age of 65

On 5 June 2018, the Constitutional Court upheld the unconstitutionality of art. 56 letter c) first thesis of Law no. 53/2003 - the Labor Code and ascertained that the provisions thereof are constitutional if the collocation “standard retirement age” is construed as not precluding a woman from requesting the continuation of her individual employment agreement, in conditions identical to men, respectively until she reaches the age of 65.

Self-evaluation form - an alternative to ANCEX's denial when exporting dual-use products

The General Directorate of Customs issued a circular to all subordinate institutions introducing a positive measure on dual-use items. As such, exporters can present at the time of customs clearance a self-assessment form as an alternative to the dual-use advice request issued by ANCEX ("ANCEX denial"), thus reducing the time of customs clearance.

Approval of the Methodological norms for applying the Law no. 227/2017 regarding the Tax code

The Government Decision no. 354/25.05.2018 for amending and completing the Methodological norms for applying the Law no. 227/2015 regarding the Tax code has been published.

Origin of goods – new certification rules in trade between the EU and India, Angola, Congo, Nepal and other GSP countries

Until June 30, 2018, exporters from India, Angola, Congo, Nepal and other GSP countries need to register in the EU Register of Exporters (REX system). After this date, FORM A certificates can no longer be used to certify origin for goods traded between such countries and the European Union.

 

The first EU regulations on virtual currency exchanges and wallets

On April 19, the European Parliament approved a directive whereby, among others, provides for the first time at European level a legal framework for virtual-fiat currency exchange platforms and custodian wallet providers.

In addition, the approved directive regulates expressly remote and electronic client identification, thus facilitating the digitalization of customer on-boarding across Europe.

 

Amendments and completions regarding the method of calculation and the procedure for the approval of the maximum prices of medicinal products for human use

By Order of the Minister of Health no. 407 of 30th of March 2018 (the “Order”) published in the Official Gazette no. 288 of 30th of March 2018, it has been approved the amendment and completion of the Order of the Minister of Health no. 368/2017 approving the Norms regarding the method of calculation and the procedure for the approval of the maximum prices of medicinal products for human use (the Norms”).

 

Minor offences provided under labor regulations that are object of the prevention law

Law 270/2017 on prevention provides that the public control authorities have the obligation to apply the sanction of warning and to establish a remediation plan if they ascertain that one of the minor offences expressly regulated by law has been committed.

The entrance into force of Law no. 81/2018 regarding the regulation of teleworking

On 2 April 2018, Law no. 81/2018 on the regulation of teleworking activity was published in the Official Gazette no. 296, which shall take effect starting with 5 April 2018.

 

Major changes to the Tax Code

Law no. 72/2018, Government Emergency Ordinance no. 18/2018, Government Emergency Ordinance no. 25/2018 amended recently the Tax Code on profit tax, income tax, withholding tax (“WHT”), microenterprises regime and Value Added Tax (VAT).

Common set of rules for calculating taxable profits (CCCTB), voted by the European Parliament

On 15 March, the European Parliament voted in favour of plans establishing a common consolidated corporate tax base (CCCTB), namely a common set of rules that companies operating in the EU can use to calculate taxable profits.

European Commission directives proposed on taxation of companies in the digital economy

The European Commission proposes two solutions on a long-term and on a short-term for taxation of companies with significant digital presence.

ECOFIN Agreement for the tax intermediaries’ directive and for revising the list of non-cooperative jurisdictions

According to the agreement, tax intermediaries are obliged to report structures including cross-border transactions.

Decision of the Court of Justice of the European Union (CJUE) on time limits for claiming VAT refunds

VAT can be reclaimed after the statute of limitation period has expired.

Opinion of the Advocate General of CJUE on the VAT exemption for transactions concerning payments

VAT exemption denied for instructions to transfer money.

Legislative proposal in connection with the General Data Protection Regulation – Provisions that derogate from the European rules

The Romanian Parliament drafted a legislative proposal regarding the applicable measures for enforcing the (EU) Regulation 2016/679 issued by the European Parliament and the Council on the protection of natural persons with regards to the processing of personal data (“General Data Protection Regulation”).

 

The companies intending to import, export or produce controlled substances that deplete the ozone layer must register before 8 May 2018

Companies which, in 2019, intend to import or export ozone-depleting substances or which intend to produce or import these substances for essential laboratory and analytical uses, must obtain a license, according to the Notice issued by the European Commission.

Amendments to the Fiscal Code regarding social security contributions section

The government amended the Fiscal Code by the Emergency Ordinance no. 3/2018, published in the Official Gazette no. 125/08.02.2018, regarding social security contributions section, the main subject being, according to the note, to ensure a unitary fiscal regime of the social security contributions.

The deadline to submit the 600 form has been extended

The Government Emergency Ordinance no. 2/ 2018 to extend some deadlines provided by the Law 227/2015 regarding the Tax code has been published. In this respect, the deadline for submitting the 600 form was extended until 15th of April 2018.

Implementation of the New Customs Code - European Commission’s conclusions

In a report published at the end of January on the implementation of the new Customs Code, the European Commission announced, among other things, the amendment of the exporter's definition from the customs legislation’s perspective.

The electronic transport document can be used as a transit declaration

The electronic transport document can be used as a transit declaration for air transport is one of the main changes to the EU Convention on the Common Transit Procedure.

Deloitte in mass media

Costs of split VAT application across the EU outweigh the benefits, concludes a Deloitte study. The impact for Romania is explained by Vlad Boeriu, Partner Deloitte Romania: https://www2.deloitte.com/ro/en/pages/about-deloitte/articles/costurile-aplicarii-split-tva-in-ue-depasesc-beneficiile-impactul-estimat-pentru-romania.html

New obligation for public constructions operating without a fire safety authorization

The beneficiaries of investments consisting in constructions with public destination operating without obtaining the fire safety authorization are obliged to place notice boards in front of the entrances to the respective areas, with the following content: "This area operates without the fire safety authorization."

Cancelation of certain tax liabilities for individuals that are real estate developers

Tax liabilities that result from reclassification of the income from transfer of real estate from personal patrimony into income from independent activities, incurred up to 1st of June 2017, are canceled according to the Law no. 29/2018, published on 18th of January 2018.

A new category of programmers, exempted from income tax

The conditions of granting the income tax exemption for employees that perform activities representing creation of computer programs were amended by the joint order of MEN, MCSI, MMJS, under the no. 1.168/2017/3.024/2018/492/2018/3.337/2017, published in the Official Gazette no. 52 from 18th January 2018.

Law on public-private partnership, substantial amendments

The architecture of public-private partnership is substantial amended according to the provisions enacted by Emergency Ordinance no. 104/2017 for amending and supplementing Law no. 233/2016 on public-private partnership.

The main amendments consists of:

New definition of some concepts;

The possibility for the public partner to finance the investments with financial resources coming from public funds other than post-accession non-reimbursable external funds or their national contribution.

General and specific terms and conditions, together with the contractual framework agreement model, approved in the field of public procurement

Through Government Decision no. 1/2018 approving general and specific conditions for certain categories of procurement contracts related to publicly funded investment objectives, as published in Official Gazette no. 26 of 11 January, 2018, the general and specific terms and conditions, together with the framework agreement model for public or sectoral procurement contracts covering either the performance of works only or both the design and performance of works, have been approved, if such:

are related to publicly funded investment objectives, including non-reimbursable or reimbursable funds, and

the estimated total value is equal to or greater than the threshold value provided by art. 7 par. 1 lt. a of Law no. 98/2016, respectively 24,977,096 lei.

Legislative proposal regarding the authorization of the execution of construction and demolition works

The new proposal for the law regarding the authorization of the performance of construction and demolition works aims to replace Law no. 50/1991, restructuring the law and bringing forward a series of substantial changes.

The national average gross salary applicable for 2018 was published

The value of the national average gross salary used for establishing the budget of the state social insurance for the year of 2018 is 4,162 lei.

VAT split payment – The final form of the law

Only the companies having VAT debts or in insolvency will mandatory apply the VAT split payment system starting with 1 January 2018, according to the final form of the law on the VAT split payment, published in the Official Gazette.

New calculation rules regarding contributions and taxes due to the Environmental Fund

New methodological rules for calculating the contributions and taxes due to the Environmental Fund came into force on December 28, 2017, according to Order of the Ministry of Environment no. 1503/2017 for modifying and completing the methodology of calculation of taxes and contributions due to the Environment Fund.

New provisions on medical leave and allowances

The main changes concern the introduction of a voluntary insurance contract for medical leave contributions.

Amendments for certain tax and social security forms

Taking into consideration the newly introduced tax provisions, entered into force as of 1st of January 2018, certain tax forms have been updated in order to be in line with the new legislative provisions.

Decision to set quota for work permits that can be issued to foreigners during 2018

On Friday, 29 December 2017, it was published the decision establishing the work permits quota for year 2018 that can be issued to foreign citizens.

Changes to the provisions of the law regarding public pensions

The new provisions refer to the monthly basis for computing the social security contribution for individuals insured under a voluntary insurance contract.