ROMANIA

Source: IMF, International Financial Statistics, July 2021.

• The Romanian central bank is the Banca Natională A României (BNR – www.bnro.ro)
• The BNR is a member of the European System of Central Banks (ESCB).

• The application of lifting fees varies from bank to bank.

• Credit transfers are used by companies to pay salaries and suppliers, and to make tax and treasury payments.
• The majority of credit transfers are automated.
• High-value and urgent EUR-denominated domestic and cross-border (within the euro zone) credit transfers can be settled in real time via TARGET2.
• High-value (above RON 50,000) and urgent RON-denominated credit transfers can be settled in real time via ReGIS.
• High-value, cross-border credit transfers in domestic and foreign currencies can be processed via SWIFT, correspondent banking and bank branch networks.
• Low-value (less than RON 50,000) and non-urgent credit transfers can be settled on a same-day basis via SENT.
• Payments sent via the Instant Payments service can be made 24/7/365 up to a maximum of RON 50,000/EUR 15,000 online and via mobile.
• SEPA credit transfers can be settled via EURO-SENT or STEP2 (accessed indirectly via international networks). Twenty-three banks in Romania participate in the SEPA credit transfer scheme.
• The European Payment Council’s SCT Inst scheme (a pan-European 24/7 instant payment scheme for SEPA credit transfers) enables the transfer of funds (the maximum threshold value is EUR 100,000) to another account in less than ten seconds.
• EBA Clearing and Italy’s SIA Group have developed and implemented a pan-European platform for instant EUR payments called RT1. It is fully compliant with the SCT Insts scheme and is in line with the ISO 20022 global messaging standards for instant payments.
• EBA Clearing has launched a pan-European request to pay (R2P) infrastructure solution with the support of 27 payment service providers from 11 countries. The new 24/7 service is compatible with the SCT and SCT Inst schemes and allows payees to take the initiative to request a specific payment from the payer.
• TIPS is a pan-European service for the settlement of instant payments in central bank money. The service enables payment service providers and ACHs with access to TARGET2 to offer fund transfers 24/7, 365 days a year. TIPS is aligned with SCT Insts. It is primarily focused on EUR payments but is technically capable of settling payments denominated in other currencies.

• Direct debits are used for regular payments, such as utility bills.
• Direct debits are settled on a next-day basis via SENT.
• SEPA direct debits are available in Romania and can be settled on a same-day basis via STEP2. Two banks in Romania offer Core SDDs. One offers B2B SDDs.

• The cheque is not a common cashless payment instrument in Romania. It is primarily used for commercial payments.
• Cheques are truncated into electronic items before being settled via SENT. Cheques are usually settled within two days.
• Cheques that are not truncated are cleared bilaterally between banks.

• Card payments are increasingly popular, especially for retail transactions.
• There were 18,818,308 cards (14,592,364 were active) in circulation at the end of Q1 2021. Of these, 15.9 million were debit cards and 2.9 million credit cards.
• Contactless cards are issued and are rapidly being adopted by consumers – it is estimated that two out of three payments are made using contactless payment cards.
• Visa and Mastercard-branded payment cards are the most widely issued.
• Transactions are processed via Romcard, Provus Service Provider or PayNet before clearing via Visa and MasterCard's own clearing houses.
• All cards issued are SEPA-compliant with EMV chips.

• There were 10,184 ATMs in Romania at the end of Q1 2021.
• There were 260,594 EFTPOS terminals in Romania at the end of Q1 2021.
• All ATMs and POS terminals are EMV-compliant.

• Reloadable pre-paid cards are available.
• Mobile wallet and payment services, such as the local Romcard Masterpass Wallet, MobilPay and Google Pay are available.

• BNP Paribas' trade centre for Romania, based in Bucharest, comprises a senior trade manager and a trade advisor. Back office support is provided through the shared service centre located in Bulgaria. In addition to trade finance solutions, such as trade guarantees, the bank offers a highly competitive portfolio of supply chain management solutions, including inventory solutions and non-recourse, undisclosed receivables financing.

• The EU has trade agreements in place with over 30 countries.
• The EU is currently in free trade negotiations with a number of countries, including the Association of Southeast Asian Nations (ASEAN), Australia, Indonesia, Mercosur (the Southern Common Market), Uruguay, and the USA.
• The EU and the UK are currently negotiating their future trading relationship, following the UK’s withdrawal from the EU.

Sources: IMF, International Financial Statistics, July 2021.

• Import licences are required for specific items subject to international export controls.

• Tariffs are set according to the EU customs code for all imports from outside the EU with higher tariffs for agricultural imports.

• None

• None

• Romania prohibits the import of certain items in line with EU regulations and UN Security Council resolutions.
• Specific imports are prohibited in order to protect fauna and flora, for health and safety or moral reasons, and/or for national security.

• Export licences are required for specific items subject to international export controls.

• None.

• None.

• Romania has implemented the EU directive on export credit insurance.
• EximBank, Romania’s national export credit agency, provides state-supported export credit insurance.
• Export credit insurance is also available from private insurance companies.
• Export financing is available from commercial banks.

• Romania prohibits the export of certain items in line with EU regulations and UN Security Council resolutions.

• Romania has no foreign exchange restrictions.
• Resident entities must only use RON when trading in goods and services.
• BNR authorisation is required for investments of 10% or more in a bank’s capital.

• Generally gains arising from financial instruments are taxable, and corresponding expenses deductible, but an analysis on a case-by-case basis needs to be performed.

• Advance pricing agreements (APAs) are available. The deadline for issuing an APA is up to 12 months for unilateral agreements and up to 18 months for bilateral (or multilateral) agreements. The filing fee for an APA varies, depending on the taxpayer’s classification (i.e. a large taxpayer). An APA can be concluded for up to five years.

• Capital gains obtained by Romanian resident companies are included in ordinary profits and taxed at a rate of 16%.
• Gains derived by resident and non-resident entities from the sale of shares and real property are included in overall profits and taxed at the general corporate tax rate of 16%.

• 1. A 16% withholding tax is levied on interest paid to a non-resident company, unless the rate is reduced under a tax treaty or the EU Interest and Royalties Directive. The withholding tax on interest paid to an EU resident is reduced to 0% under the directive, provided the requirements for application of the directive are met (a minimum 25% holding for an uninterrupted period of at least two years).

  2. The general withholding tax on dividends paid to a non-resident is 5%. A 5% rate also applies to dividends paid by a Romanian legal entity to a legal entity resident in another EU member state, or to a PE of a company from an EU member state situated in another EU member state if the dividends do not qualify for an exemption under the EU Parent-Subsidiary Directive (a minimum 10% holding for an uninterrupted period of at least one year). The rate is 0% if the directive applies.

  3. A 16% withholding tax is levied on royalties paid to a non-resident company, unless the rate is reduced under a tax treaty or the EU Interest and Royalties Directive. The withholding tax on royalty payments made to an EU resident is reduced to 0% under the directive, provided the requirements for application of the directive are met (minimum 25% holding for an uninterrupted period of at least two years).

   

• Romania levies a 50% withholding tax on payments made to a jurisdiction that has not concluded an agreement with Romania for the exchange of information if the payment is made in relation to an artificial transaction.

• Romania has concluded tax treaties with approximately 90 countries.
• Romania is a signatory of a multilateral co-operation agreement (the MCAA). Under this multilateral agreement, information will be exchanged between tax administrations, giving them a single, global picture on some key indicators of economic activity within multinational enterprises (MNE).
• Romanian parent entities controlling an NE group, or entities that are part of MNE groups, whose consolidated income is greater than EUR 750 million in the year preceding the reporting fiscal year, are required to make this annual CbC report. 
• With country-by-country reporting, tax administrations of jurisdictions where a company operates will have aggregate information annually relating to the global allocation of income and taxes paid, together with other indicators of the location of economic activity within the MNE group. It will also cover information about which entities do business in a particular jurisdiction and the business activities each entity engages in. The information will be collected by the country of residence of the MNE group, and will then be exchanged through exchange of information supported by such agreements as the MCAA. First exchanges under the MCAA started in 2017–18 on 2016 information.

• Romania applies the interest deduction limitation rules in the EU anti-tax avoidance directive (ATAD). Under these rules, ‘exceeding borrowing costs are deductible up to a threshold of EUR 1 million plus 30% of tax adjusted EBITDA.

• Transfer pricing rules follow the OECD guidelines. The tax authorities may adjust intercompany pricing to reflect the fair market value in appropriate cases.
• Large taxpayers carrying out intragroup transactions exceeding certain thresholds are required to prepare a transfer pricing file on an annual basis. The transfer pricing file and all related supporting documentation must be submitted within 10 days of a specific request by the tax authorities.
• An APA may be obtained for up to five years.

• No stamp duties are levied in Romania.

• Cash pooling is not specifically regulated under Romanian fiscal legislation. In principle the cash pooling system could be structured contractually between the parties involved.
• However, from a legal compliance point of view the transactions carried out under cash pooling arrangements need to be specifically analysed by the BNR on a case-by-case basis, in order to determine whether they fall under professional granting of loans, which is subject to BNR  regulations.
• From a tax point of view, receiving or granting loans through cash pooling agreements are seen as separate loan agreements.

• There are no specific taxes on financial transactions/banking services in Romania.

All tax information supplied by Deloitte Touche Tohmatsu and Deloitte Highlight 2021 (www.deloitte.com) .