Law No. 35 Of 3 April 1991 On Foreign Investment Regime

Original Language Title:  LEGE nr. 35 din 3 aprilie 1991 privind regimul investiţiilor străine

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LAW No. 35 of 3 April 1991 * Republished on the regime of foreign investments published in PARLIAMENT ISSUING the OFFICIAL GAZETTE NR. 185 of 2 august 1993 Reissued under art. 2 of law No. 57 of 10 July 1993, published in the Official Gazette of Romania, part I, no. 160 of 14 July 1993, Rosca articles a new numbering.
Law No. 35/1991 was published in the Official Gazette of Romania, part I, no. 73 of 10 April 1991.
In order to attract foreign investments in Romania are hereby adopted this law, which includes provisions likely to ensure foreign investors guarantees and facilities, as well as full and unlimited use of the results.

Chapter 1 General provisions Article 1 for the purposes of this law, by foreign investment in Romania: the formation of companies), subsidiaries or branches, with foreign capital or in combination with natural persons or legal entities, according to the provisions of law No. 31/1990 on companies;

b) participation in the capital of an existing company or dobindirea of shares at such times, company shares and bonds or other effects on trade;

c) concession, lease or location, under the law, economic activities, public services, production units of 1900 or companies;

d) dobindirea ownership of property, movable or immovable, real rights, except the right of ownership of land;

dobindirea e) industrial property rights and intellectual;

f) dobindirea rights or other rights relating to the provision of economic value associated with an investment;

g) the purchase of production spaces or other buildings except dwellings, other than ancillary investment, and their construction;

h) contracting of works execution of exploration, exploitation and production-sharing in the field of natural sources.

Article 2 the contribution of foreign investors in Romania may consist in: a) capital in freely convertible currency;

b), equipment, transport vehicles, sub-assemblies, parts and other goods;

c) services, industrial and intellectual property-patents, licenses, know-how, trademarks and trade factory, copyright, translator, editor, knowledge and methods of organization and management;

(d) the revenue and profits from) activities undertaken in Romania, as well as goods and values obtained according to law, after payment of taxes and fees provided for by law.

Article 3 by foreign investors shall mean natural or legal persons having their residence or, as the case may be, established abroad who carry out investment in Romania, in any of the ways set out in this law.

Article 4 foreign investments can be made in all sectors of the industry, exploration and exploitation of natural resources, agriculture, infrastructure and communications, civil engineering, scientific research and technological development, trade, transport, tourism, banking and insurance services and other services, in compliance with the following conditions: (a) not to violate the rules) for the protection of the environment;

b) not prejudice the security and defence of the interests of the national team of Romania;

c) not prejudicial to public order, health and morals.

Chapter 2 article 5 Guarantees foreign investments in Romania may not be nationalized, expropriated, rechiziţionate or subject to other measures with similar effects, than in cases of public interest, in compliance with the procedure prescribed by law and with the payment of a compensation corresponding to the amount of the investment, which must be effective, appropriate and timely.

Article 6 Compensation is determined in relation to the market value of the investment at the date of taking one of the measures referred to in article 1. 5. Article 7 If the value of the compensation cannot be determined under art. 6, it shall be determined by the parties on the basis of equitable principles, depending on the invested capital, increasing its value or depreciation and income streams.

Article 8 the foreign investor does not accept the value of compensation, where applicable, under art. 6 and art. 7, it shall, at the request of the investor, the judicial process in circumstances prescribed by law.

Article 9 foreign investors shall be entitled to: (a) participate in the leadership) and investment management, according to contracts and memorandum and agreed;

b) to dispose of their contractual rights and obligations to other investors, Romanian or foreign;

c) to transfer the annual profits earned abroad what li deserves, according to currency regime from Romania, after payment of taxes, fees and other obligations provided for by the legislation of Romanian;

d) to transfer abroad the proceeds from copyright law, what are the odds it is appropriate for specialized assistance, expertise and other services, according to the contracts concluded;

e) to transfer abroad the amounts resulting from the sale of the shares, social parties, obligations and other effects on trade, as well as those resulting from the liquidation of investments, according to the currency regime from Romania;

f) to transfer foreign currency abroad, agreed the amounts obtained as compensation in the event of taking one of the measures referred to in article 1. 5. Article 10 foreign investment made under the provisions of this law shall enjoy the legal regime established through this entire length of existence, insofar as a subsequent law contains more favourable provisions.

Article 11 foreign investors benefit from the legal regime established by this law, regardless of their nationality or, as the case may be, of their nationality.

Chapter 3 Facilities article 12 Cars, machinery, installations, equipment, means of transportation and any other goods imported required investment, provided as input in nature or purchased from a cash contribution of foreign investor to increase the share capital thereof, shall be exempt from customs duties.

Article 13 shall be exempt from payment of customs duties on raw materials, consumables, spare parts and components imported, necessary and actually used in production over a period of two years, calculated from the date of putting into operation of the lens or, where applicable, from the date of commencement of the activity in relation to the legal status of foreign investment.

Article 14 foreign investment are exempted from paying tax on profits, as follows: a) those carried out in industry, agriculture, construction, exploration and exploitation of natural resources, for a period of 5 years from the date of commencement of productive activity;

b) those carried out in the field of communications and transport, for a period of 3 years from the date of commencement of the activities;

c) those performed in trade, tourism, banking and insurance, as well as in any other service, for a period of 2 years from the date of commencement of the activity.

Foreign investment. and (b). to benefit from the provisions of paragraphs 1 and 2). 1 provided that the foreign investor contribution actually paid up in cash and in kind, to represent at least 20% of the share capital of the company, but no less than $ 10,000 S.U.A. foreign investments which do not fulfil these conditions shall be subject to the provisions of the common law.

Article 15 in addition to payment of tax exemptions on profits referred to above and after expiry of the periods established are granted reductions in corporation tax, as follows: a) 50% of the profit tax which relates to use in unit established in Romania, for the enlargement and modernisation of the technical-material base, manufacturing technology or expansion, in order to obtain additional profits and investments designed to protect the environment;

b) 25%, if it meets one of the following conditions;

-ensure imported not less than 50% of the demand for raw materials, energy and fuel;
-export at least 50% of the services performed;
-use more than 10% of the expenditure on scientific research and development of new technologies in Romania and for vocational training;
-internal production from acquiring at least 50% of the machines and other equipment necessary for the development or existing investments new investments;
-to create at least 50 new jobs through a new investment or development of existing investments.

Article 16 For investments carried out in areas of special interest in the national economy, the Government, through the law may grant additional facilities.

Article 17 where foreign investments validated volunteer over a period of time less than twice that for foreign investors, who benefit from the exemption under article 19. 14, they will be forced to pay taxes imposed under the law on the entire operating time of the investment.
Taxes due under paragraph 1. 1 shall be paid in priority from the results of the liquidation of investments from other duties or due to foreign investors.

Chapter 4 Promotion and registration of foreign investments in article 18

Making foreign investments in Romania, regardless of their legal form, is based on a request from the foreign investor, registered at the Romanian Development Agency.

Article 19 Romanian Development Agency analyzes the creditworthiness of the investor, and the manner in which the investment is to be performed, and the amount of the capital invested.

Article 20 of the Romanian Development Agency responds to the demand of foreign investors based on data and information available to it or which it can obtain, upon request, from the Central and local organs of the public administration, as well as the autonomous administrations and companies in the field to be the foreign investment.
Ministries and other Central and local bodies of public administration will respond within 10 days from the date of the request.

Article 21 Romanian Development Agency is obliged to respond to requests of foreign investors within 30 days from the date of registration thereof.
If the period laid down in paragraph 1. 1 foreign investor does not receive any communication it deems that the investment can be carried out.

Article 22 foreign investors shall be entitled to carry out investments under Romanian law, laid down in relation to the methods of achieving them and confirmed by the Romanian Development Agency or foreign investor demand, in the absence of communication agency.

Article 23 quality of foreign investor in Romania proves through investor certificate, issued by the Romanian Agency for development.
Certificate shall be issued at the request of the investor to investor, within 15 days from the date of its registration, upon presentation of documents-Bylaw and statutes, contracts or other legal documents drawn up in compliance with the Romanian law requirements, taking into account the method of realization of the investment.
Investor certificate is enforceable against the Romanian authorities to prove the rights of foreign investors.

Chapter 5 financial and currency Transactions and commercial transactions Article 24 receipts and payments relating to foreign investments are made through accounts opened at banks established in Romania or headquartered abroad, according to the regulations of the National Bank of Romania.
Companies with foreign participation and foreign investors are available upon availability from their own accounts. Companies can keep the accounts in foreign currency deposited amounts as contribution to the share capital.

Article 25 shall be supplied Accounts from the financial contribution from investors, loans and of the receipts.

Article 26 companies with foreign participation and other foreign investors are allowed to borrow in foreign currency and from funding from the land units or credits in foreign currency from banks or financial institutions from abroad.

Article 27 the operations of companies with foreign participation of foreign investors is carried out on the basis of commercial contracts concluded according to law, the prices agreed.

Article 28 payment in foreign currency, including due to foreign investors, shall be made from the cash accounts or by buying the currency at the exchange rate of the day.

Article 29 or in foreign currency Profits in lei, due to foreign investors, they can be used for making new investments in Romania, for the purchase of goods and services can be the Romanian or, under the law on the financial market.

Chapter 6 final provisions Article 30 in situations where foreign investment in Romania is performed in the form of commercial companies in association with individuals or juridical persons Romanian, Romanian associations may be established, by way of contribution to social capital, ownership or other rights in rem over land or other immovable property required throughout the company.

Article 31 foreign Staff needed foreign investment activity shall be established by the Convention of the parties or by the foreign investor, as appropriate, and will be engaged only in positions of leadership and authority.

Article 32 Salaries and personnel hired for alien activity to foreign investment shall be determined by the Convention of the parties.

The provisions of article 33 of this law shall be applicable to the extent that international conventions and agreements relating to foreign investment, to which Romania is a party, don't set a different regulator.

Article 34 on the date of entry into force of this law, Decree nr. 424/1972 on the establishment and operation of ventures in Romania, Decree-Law No. 96/1990 concerning certain measures for attracting foreign capital investment in Romania, as well as any other provisions to the contrary are hereby repealed.

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