dinsdag 30 augustus 2011

state aid romania - ajutor de stat romania HG 1680/2008 for foreign investment

State aid scheme ensuring sustainable economic development

(Government Decision no. 1680/2008, subsequently amended)

the state aid scheme applies to the following 4 investment categories:
initial investments between Euro 5 and 10 million and creating 50 jobs minimum;
initial investments exceeding Euro 10 million and creating 100 new jobs minimum;
initial investments exceeding Euro 20 million and creating 200 new jobs minimum;
initial investments exceeding Euro 30 million and creating 300 new jobs minimum;

maximum aid ceiling / economic operator: - Euro 22.5 million (RON equivalent), for investments carried out and new jobs created in the development region no. 8, Bucharest-Ilfov;

Euro 28.125 million (RON equivalent), for investments carried out and new jobs created as a result of initial investment in any of the other 7 development regions in Romania.

beneficiary’s financial contribution: at least 50% of the eligible expenses; the form of this contribution must not fall under any other public aid.

maximum total budget / scheme: Euro 1 billion (RON equivalent) / 5 years (2009-2013); anual average budget: Euro 200 million, not exceeding annual budget ceilings

approved for the period of 5 years

duration of the scheme: 2009-2013

provider: Romanian Ministry of Public Finance

total number of companies estimated to be granted state aid under the
scheme: 150; average number of beneficiaries / year: 30

donderdag 25 augustus 2011

invest romania

Taking notice of Romania’s competitive advantages, smart investors realize that the greatest benefit of investing in our country is that the Romanian business climate provides a platform for reaching broad business objectives that might include penetrating new markets, globalizing company operations, or establishing new supply-chain partnerships.

Only through a strong infusion of capital, technology, and methods of modern management, through opening towards the external markets, Romania will be able to determine an important change of structure of the economy, an increase of its performances, and of its competitiveness at an international level.

When considering Romania as a possible location for developing their businesses, the foreign investors might benefit from the advantages offered by Romania:

Market & Location Advantage

One of the largest markets in Central and Eastern Europe (over 21 million inhabitants)
Market is growing, there are increasing business opportunities, while the entry barriers remain low
Attractive location: allowing an easy access to the countries of the former CIS countries, Balkans, the Middle East and Northern Africa
Attractive location: at the junction of three prospective European transportation corridors no. 4, 7 & 9

Resource Advantage

Skilled labor force, with solid knowledge in technology, IT and engineering
Rich natural resources, including fertile agricultural land, oil and gas
An important potential for tourism
Political Advantage

Stable executive power

Government - more responsive to the dialogue and suggestions of the business community
Stability factor in the Area -NATO member
Stability Guarantee in South Eastern Europe
EU membership on January 2007
IR Advantage

Bilateral agreements between Romania and other countries for investments promotion and protection

Bilateral diplomatic relations with 177 out of 191
Member of the UN and other international organizations, like: OSCE, Council of Europe and International Organization of La Francophonie
Free trade agreements with EU, EFTA countries, CEFTA countries
WTO member since January 1995
Economical Advantage

Sustainable economic growth

Year 2005 - the 6th one of continuous growth for the country
Functional Market Economy status
Decreasing inflation
Permanent financial assistance for SME's Development
Increasing interest of foreign investors
Privatization program still including some very interesting companies
Commitment of investment funds present in the country to develop their business and the association of the government with international financial institutions, such as IMF, EBRD, World Bank, and the EU Commission

Improving Infrastructure Advantage

Well-developed networks of mobile telecommunications in GSM systems
A highly developed industrial infrastructure, including oil and petrochemicals
The presence of branch offices and representatives of various well-known international banks
A newly developed highway infrastructure
Commitment to improve the highway infrastructure to EU standards
Extensive maritime and river navigation facilities

Social and Education Advantage

Agreement between Government and Major Unions
No major Union Movements
Permanent dialogue with the employees associations
Labor relations regulated by the Labor Code
Foreign languages largely spoken in the main cities
Good housing, schooling, shopping, etc. options

Legislative Advantage

Good law and order
Legislation compatible with Acquis Communautaire
Similar legal provisions as in UE
Healthy fiscal policy regulated by the Fiscal Code
Competitive tax policy: 16% flat tax

zaterdag 13 augustus 2011

State aid in the GD no. 1680/2008 subventions in romania

Source : Applicant Guidelines for State aid in the GD no. 1680/2008 to establish a state aid scheme for ensuring sustainable economic development, as amended and supplemented, May 2011

The submitted documentation must show that the state aid has a ˝ incentive effect˝ and meets one or more of the following criteria:

• A material increase in the size of the project/activity due to the aid;
• A material increase in the scope of the project/activity due to the aid;
• A material increase in the total amount spent by the beneficiary on the project/activity due to the aid;
• A material increase in the speed of completion of the project/activity concerned;
• The project would not have been carried out as such in the assisted region concerned in the absence of the aid

Conditions for granting state aid

The provisions of this state aid scheme applies to enterprises that are registered according to Law no. 31/1990 republished, with subsequent amendments and completions, which make investments in Romania and are situated in the following categories:

a) attain an initial investment with a value falling between 5 and 10 million euro, including the equivalent in lei, and create at least 50 new jobs following the completion of the initial investment;
b) attain an initial investment with a value that falls between 10 and 20 million euro, including the equivalent in lei, and create at least 100 new jobs following the completion of the initial investment;

Eligibility criteria

The enterprises that meet cumulatively the eligibility criteria upon submission date, can benefit from specific allocations under the aid scheme:
a) are registered according to Law 31/1990, republished, with subsequent amendments and completions, and make investments in Romania,
b) intend to make an initial investment falling within any category referred to in points a) - d) of Article 2 of the GD no. 1680/2008.
c) there is no history of payment delinquency to the consolidated budget
d) are not in enforcement procedure,bankruptcy,judicial reorganization, dissolution, operational closure, liquidation or other situations covered by law;
e) are not classified as "enterprises in difficulty" under Commission Regulation no. 800/2008 declaring certain categories of aid compatible with the common market in application of Articles 87 and 88 of the Treaty (General Block Exemption Regulation)
f) no decisions have been issued against them for recovery of state aid or if such decisions were issued they were executed according to legal provisions,
g) when applying for state aid they have to present a viable investment plan (costs will be detailed: quantity, price, value) and a technical-economic study issued by a specialized company which proves the economic efficiency of investment in compliance with the indicators referred in Chapter III of this guidelines;
h) do not make investments and do not create new jobs, which require state aid under this scheme in the fields of activity exempted by GD no. 1680/2008.

State Aid Intensity

For investments whose eligible costs are less than 50 million, the gross intensity of regional aid cannot exceed 50% of initial investment costs, or wage costs over a period of two years with new staff. For investments or jobs done in Region 8 Bucharest - Ilfov, state aid intensity is 40%.

Eligible costs

Standard cost does not include expenses for the following chapters of the general estimate of the investment structure, approved by Government Decision no.28/2008:

- Chapter 1. - Expenses for obtaining and arranging land;
- Chapter 2. - Expenses for utilities necessary for the objective;
- Chapter 3. - Expenses for engineering and technical assistance;
- Chapter 4 - Expenses for basic investment,
- Chapter 5. – Other expenses;
- Chapter 6. - Expenses for technological tests and tests and teaching to the beneficiary.


Are considered eligible the costs associated with an initial investment made in the same area including:
a) tangible and/or intangible assets relating to the setting-up of a new establishment, the extension of an existing establishment, diversification of the output of an establishment into new additional products or a fundamental change in the overall production process of an existingestablishment.
b) the acquisition of the capital assets directly linked to an establishment, where the establishment has closed or would have closed had it not been purchased, and the assets are bought by an independent investor. The sole acquisition of the shares of an undertaking shall not constitute investment.

Tangible assets means assets relating to: industrial, tourist and medical buildings and equipment.

Intangible assets means assets entailed by the transfer of technology through the acquisition of patent rights, licences, know-how or unpatented technical knowledge

Intangible assets must meet the following conditions:

a) they must be used exclusively in the undertaking receiving the aid;
b) they must be regarded as amortizable assets, as required by law;
c) they must be purchased from third parties under market conditions, without the acquirer being in a position to exercise control on the seller or vice versa
d) they must be included in the assets of the undertaking and remain in the establishment receiving the regional aid for at least five years.

Replacement is accepted if the criteria analysis to keep the investment takes into consideration the assets that have been obsolete in this period due to rapid technological change.


See separate sheet on demand cibr@telenet.be