Effective 18 April 2015, the Romanian privatization rules have been broadened in regards to the transfer of assets of state owned companies. Of note, both the types of assets that may be transferred and the types of companies permitted to make transfers have been broadened. The changes come about as a result of Law no. 75/2015 which amends Government Emergency Ordinance no. 88/1997 on the privatisation of companies.
The objective of the amended privatisation rules remains largely the same, namely, to regulate the terms and conditions applicable to:
- the sale of shares in companies in which the state or a local public administration authority is a shareholder (irrespective of the number of shares owned) and
- the sale of assets of companies and autonomous administration companies (in Romanian “regieautonomă”) in which the state or a local public administration authority is a majority shareholder;
Under the amended regulations, “assets” not only include goods and investments, but also functional assets, consisting of:
- economic resources derived from fixed, current or treasury assets, know-how or any rights and obligations arising in relation to such assets, and
- human resources, considered as being reasonably exploitable in present and future economic activities.
Additionally, the amended ordinance permits autonomous administration companies in which the state or a local public administration authority is a majority shareholder to transfer assets by means of direct negotiation, to other legal entities in which the state or a local public administration authority is a majority shareholder. (Under the prior law, only companies where the state or a local public administration authority is a majority shareholder could have made such transfer of assets.)
Moreover, public institutions, companies and autonomous administration companies that are 100% or majority state owned may take over assets –including functional assets– from other companies/autonomous administration companies in order to maximize their economic value. This type of take-over may be made to reduce the level of duties that are due or to restructure or reorganize the transferring entity.
The full report, in Romanian, can be accessed here.