Romania: State aid amendments with focus on investments in assets and new working places

By Iulian Sorescu & Bogdan Nicolae Paunescu | Noerr

On 3 July 2019, the Ministry of Public Finances published two draft amendments of state aid legislation, specifically the state aid scheme governed by G.D. 807/2014 on investment in assets and the state aid scheme governed by G.D. 332/2014 on job creation.

Several amendments have been proposed and are waiting to be approved by the Ministry of Public Finances after discussions with the private sector. Here are the most important ones:

G.D. 807/2014 for investment in assets

  • Intensity – the maximum intensity for certain regions and counties will be amended in order to eliminate discrepancies in development between areas by stimulating investment in poorly developed counties
  • Salary expenses – introducing the possibility of financing not only tangible and intangible assets but also salary costs

G.D. 332/2014 for job creation

  • Application windows – the old application based on “windows” will be replaced by a continuous submission mechanism, similar to GD 807/2014 for investment in assets
  • Scoring – eliminating scoring-based selection, similar to GD 807/2014 for investment in assets
  • Project implementation – introducing the option to start an investment project immediately after submission of the application, similar to GD 807/2014 for investment in assets
  • Job creation threshold – increasing the minimum threshold for job creation from 10 to 30 new working places classified as highly qualified and qualified jobs, each category with a different minimum gross salary
  • Intensity – the maximum intensity for certain regions and counties will be amended in order to eliminate discrepancies in development between areas by stimulating investment in poorly developed counties

As mentioned above, the MFP published unexpected draft amendments on 3 July, and the private sector has 10 working days to respond with their own draft amendment proposals. During these 10 days, we will be analysing and calculating the impact of the proposed amendments and submitting our draft amendment proposals to the MFP. After proposals are approved, they will be implemented in the new Applicant’s Guide, along with possible additional amendments.

The Minister of Public Finances, Mr. Teodorovici has declared that “We want to adapt the provisions of state aid schemes to the economic realities as well as to the needs and challenges facing the Romanian business environment”. The annual state aid budget of approx. EUR 145 million has been confirmed. This is a clear message from the Minister that they will continue to support investments in the country in the near future and that they intend to encourage investors to invest more strongly in the lesser-developed areas of Romania. As the unemployment rate is rather high in these regions, this could be a good opportunity for investment in labour-intensive sectors.

Compliments of Noerr, a member of the EACCNY