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Law No. 7 Of February 5, 1992

Original Language Title:  LEGE nr. 7 din 5 februarie 1992

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LEGE No 7 of 5 February 1992 on the financial coverage of the obligations of the remaining irregular state on 31 December 1990 and the takeover by the State and commercial banks of losses recorded in 1989 and 1990 by economic agents with state capital, as well as bad bank loans
ISSUER PARLIAMENT
Published in OFFICIAL GAZETTE NO. 17 of February 11, 1992



The Romanian Parliament adopts this law + Article 1 The financial coverage of the obligations of the state remained irregular on December 31, 1990 with autonomous regions, commercial companies and other economic units with state capital is approved, within the amount of 92.8 billion lei, according to Annex no. 1. + Article 2 It is approved the takeover by the state and commercial banks, within the amount of 173.3 billion lei, of losses recorded by economic agents with state capital in 1989 and 1990, remaining uncovered, of non-performing bank loans granted in previous years for investments, as well as bank loans granted for exports and construction works assembly carried out in previous years within the framework of governmental, commercial and cooperation agreements of Romania with other countries. The financing commercial banks will take over 10% of the amount provided in the previous paragraph, in proportion to the bank loans related to it, as a discount, which will be covered from a special fund constituted in accordance with the provisions of the 9 9 of Annex no. 2 2 to Law no. 12/1991 12/1991 on corporate income tax. The difference, up to the limit of 155.8 billion lei, is taken over by the state, constituting the account of public debt for the asanation of losses and non-performing bank loans in previous years. + Article 3 The takeover of losses from economic agents with state capital will be made within 30 days of the publication of this law. The losses that are taken will be relieved with that part covered by each economic agent from: a) the resulting amounts as favorable influences from the revaluation of stocks of raw materials, materials, semi-finished products, finished products, etc., determined and retained for this purpose according to the legal regulations; b) the profit part of 1991 which, according to the law, is intended to cover losses of previous years; c) availabilities of the non-committed development fund in the coverage of investment expenditures for 1991; d) reserve fund constituted according to the law; e) the insurance fund constituted in 1990 in the state agriculture; f) the amounts made available to economic agents from the availability of funds of former plants, blocked at their abolition; g) the amounts made available to economic agents from the extra-budgetary fund constituted at the level of the national economy from favorable influences resulting from the revaluation of stocks. Losses recorded by economic agents with state capital from the activity of 1989 and 1990, according to the balance sheet data of December 31, 1990, as well as losses that will be taken over by the state and commercial banks, within the amount of 84.1 billion lei, are rendered in Annex no. 2. + Article 4 The takeover by the state and by the commercial banks of bank loans granted to economic agents with state capital for investments in previous years, which have become non-performing, amounting to 51.1 billion lei, according to Annex no. 3, as well as bank loans in lei granted to foreign trade enterprises for exports and construction-assembly works executed in previous years, within the framework of governmental, commercial and cooperation agreements of Romania with other countries, which amount to 33.7 billion lei, according to Annex no. 4, will also be made within 30 days from the date of publication of the present law. + Article 5 It is constituted in the national reserve, assimilated to geological reserves with non-ferrous metal contents and remaining in the custody of the units that hold them, until their liquidation, the stocks of concentrated zinco-plumboase, of poor manganese ores and of metallurgical by-products, unworkable by the technologies and capabilities currently in the country. Loans related to those stocks, up to the amount of 4.436.7 million lei, of which 2.951.7 million lei to the Commercial Company "Sometra"-S.A. Copsa Mica and 1.485 million lei to the Autonomous Regia of Plumb and Zincului Baia Mare, will be taken over by the state in the account of public debt and commercial banks under the present law. With the amounts made from the valorization of stocks constituted in the national reserve, according to the provisions of this law, the respective public debt will be + Article 6 In application of art. 3 and 4 of this law, are constituted commissions made up of representatives of the Ministry of Economy and Finance, the National Bank of Romania and, as the case may be, of the Ministry of Commerce and Tourism, Banca Comerciale Române-S.A., Development-S.A., Banca Agricole-S.A., Banca Române pentru Commerce Exterior-S.A., which will analyze, verify and endorse, on the basis of accounting balance sheets, losses and non-performing bank loans from autonomous regions, companies and the other economic units with state capital. The takeover of losses, as well as non-performing bank loans will be made on the basis of minutes, drawn up between the committees established according to the previous paragraph and the boards of directors of economic agents. Interest due by economic agents for bank loans related to losses, as well as those due for non-performing loans, calculated and not collected by commercial banks until the acquisition of losses and bank loans non-performing, cancel. Accordingly, the interest calculated by the National Bank of Romania for refinancing is cancelled. + Article 7 The bank loans for the investments taken over will continue to be highlighted by the economic agents who have also received them by the commercial banks that have granted them in accounts outside the balance sheets and will be followed by the Ministry Economy and Finance, as well as by the respective commercial banks, in order to reactivate and repay them, depending on the financial possibilities of the economic agents concerned, from the resources of the development fund. + Article 8 Bank loans for exports and construction-assembly works executed under the government, commercial and cooperation agreements taken over will also be highlighted, further, by the economic agents who also received them from the government. to commercial banks that have granted them, in accounts outside the balance sheets, and will be followed until collection or resolution, according to the provisions of external contracts and credit agreements. Ministry of Commerce and Tourism-Department of Foreign Trade, in collaboration with the Ministry of Economy and Finance, the National Bank of Romania, commercial banks and, as the case may be, other ministries will act to recover external claims by collecting them in cash or bringing into the country of products specified in the material balances, as well as other goods for the internal market or for the valorisation of third markets, and may also resort to other common mechanisms in foreign markets, collection of claims, such as: indirect imports by means of operations of Swich, divestment or sale of receivables, including by auctioning them, according to legal regulations. The currency obtained from the collection of external claims and related interests will be transferred to the foreign exchange fund of the state, at the exchange rate from the date of the operations. + Article 9 For the tracking and collection of the amounts resulting from the reactivation of bank loans for investments and from the recovery of foreign receivables taken, commercial banks will collect, from the value in lei of recovered receivables, a commission, which will be negotiate with the Ministry of Economy and Finance + Article 10 The internal public debt constituted according to the provisions of this law, including the interest related to bank loans contracted in the account of this public debt, will be reimbursed, respectively payments, from the following resources: a) net amounts obtained from the reactivation and repayment of obligations of economic agents, representing bank loans for investments taken into account of public debt; b) net amounts in lei obtained from the recovery of external claims in the account of public debt, representing the value in lei, at the official rate, of the currency given to the foreign exchange fund of the state and the value of the products or goods brought to the country on account of those claims; c) availabilities from the extra-budgetary fund constituted at the level of the national economy on account of the influences from the revaluation of the remaining stocks after the financial coverage of the obligations of the irregular state on December 31, 1990 and other expenses legally approved of this extra-budgetary fund; d) the amounts established and approved annually, with this destination, by law, from the sale of the shares held by the state to the companies; e) other sources established according to law. + Article 11 The public debt constituted according to the provisions of this law will be covered, until liquidation, by bank loans, negotiated, on behalf of the state, in the account and with the agreement of the Ministry of Economy and Finance, by the National Bank of Romania. The National Bank of Romania is authorized to ensure the refinancing of commercial banks through a special facility, with a concessioned interest. This facility will cover two thirds of the credit granted by commercial banks for public debt constituted under this law. The interest on bank loans is calculated and paid, quarterly, on the remaining loan. + Article 12 Losses of any kind of autonomous regions, companies and other economic units with state capital, recorded according to the data provided in art. 2, will trigger bankruptcy proceedings. This law was adopted by the Senate at its meeting of 23 January 1992, in compliance with the provisions of art. 74 74 para. (2) of the Romanian Constitution. SENATE PRESIDENT academician ALEXANDRU BIRLADEANU This law was adopted by the Chamber of Deputies at the meeting of January 27, 1992, in compliance with the provisions of 74 74 para. (2) of the Romanian Constitution. CHAMBER OF DEPUTIES PRESIDENT MARTIAN DAN + Annex 1 SITUATION the obligations of the non-financial state on 31 December 1990 and their financial coverage -million lei-Irregularized obligations covered by: favorable influences from the revaluation of the extrabugarian aurulifond *) TOTAL:92.805,539.952, 752.852, 8 of which: -Unfavorable differences in imports of raw materials from 1 January to 31 October 199025.243, 8 * *) -25.243.8 * *) -Unfavorable differences in imports of raw materials from 1 November to 31 December 1990155,0-155,0 -Unfavourable differences in exports made from 1 November to 31 December 19909.803, 9-9.803, 9 -Subvents and price differences and unsettled tariff from the budget in the year 19908.170, 9-8.170, 9-Investments and other expenses not settled from the budget in 19909.479, 2-9.479, 2-Completing the capital paid by the state for the establishment of subscribed capital at commercial banks 36.143, 736.143.7- state at the end of 19903.809,03.809,0- Note * *) as the funds from the revaluation of stocks and the sale of dwellings from the state housing stock are constituted. Note ** **) including interest related to bank loans temporarily used to cover adverse differences in imports, until their regularization from public funds. + Annex 2 SITUATION losses recorded by economic agents with state capital in 1989 and 1990, remaining not financially covered at the end of 1990, coverage and losses taking over by the state and commercial banks -million lei-Amount-Losses from the activity of the year 198994.088,0-Losses from the activity of the year 199039.698,1-Loss of calamitati3.147, 6 TOTAL LOSSES: 136.933, 7 of which: 1. state and commercial banks 84.115.1 + Annex 3 SITUATION bank loans granted to economic agents with state capital for investments in previous years, which have become non-performing -million lei-Ministry/DepartmentSum TOTAL ECONOMY:51.064, 9 Ministry of Industriation8.480, 7 of which:-Autonomous Electricity Direction "Renel" Bucuresti2.930, 5-Department of Wood Industry 613,0-Department of Construction Industry Masini150,0-Department of Chemical and Petrochemical Industry 948,0-Department of Metallurgical Industry 3.545, 4-Department of Electrotechnical Industry-5.2-Department of Building Materials Industry 288,6 Ministry of Commerce and Turismului205.3 of which: -Department of Commerce Interior12.1-Department of Foreign Trade 104.8-Department of Tourism 88.4 Ministry of Public Works and Territorial Amenation1.167, 8 of which:-Department of Construction and Works Publice1.167, 8 Ministry of Agriculture and Food 22.715, 3 of which:-Department of Agriculture of States14.596, 8-Department of Food 3.031, 6-Directorate of Mechanization of Agriculture 1.170, 0-Department of Land Improvement 1.195, 4-Direct units subordinate2.721, 5 Ministry of Medium1.319.5 of which: -Department of Apelor1.287, 5-"Romsilva"-R.A. 32, 0 County and Bucharest Municipality 221.7 Non-performing loans, established by county by financial and banking bodies, which will be taken under the control and based on the nominal lists submitted by the Ministry Economy and Finances16.954, 6 + Annex 4 SITUATION bank loans in lei granted to foreign trade enterprises for exports and construction-assembly works executed in previous years, within the framework of governmental, commercial and cooperation agreements with other countries -million lei-Ministry/Department TOTAL ECONOMY:33.710, 7 Ministry of Industriation20.053, 6 of which: -Department of Construction Industry of Masini10.802, 7-Department of Electrotechnical Industry 1.779, 5-Department of Wood Industry 1.043, 0-Department of Chemical and Petrochemical Industry 621,4-Department of Textile Industry and Pyelariei3.699, 7-Department of Metallurgical Industry 650.6-Department of Petroleum 637,3-"Romelectro" 591,3-Department of Mines228,1 Ministry of Agriculture and Food 464.9 Ministry of Public Works and Territorial Amenation3.807, 3 Ministry of Defence Nationale9.384, 9 -----------------