M&A Law in Romania

Of all the areas of law that you provide services for, which is the most commonly sought after? Why do you think that is?

Our main areas of expertise are Corporate and Commercial, M&A, Aviation, Employment, Banking and Finance, Litigation & Arbitration and Real Estate and Construction. We also provide valuable legal advice and assistance to clients operating in the shipping sectors and the energy and renewables industry.

Is there anything that an international company needs to know before conducting business in Romania?

Taxation in Romania is very low. All companies at the beginning will pay a tax of 3% of revenue and if the company has at least one employee, it will pay 15 % revenue tax.  In case the company has a total revenue of a minimum of one million Euro per year, or its share capital is 45,000 (forty-five thousand) Euros, and it has a minimum of two employees, the company will pay a profit tax of 16%.

In Romania, some important laws in the fiscality field are amended very often which somewhat creates a fiscal instability.

Where do you think growth in the Romanian M&A market will come from in the next 12 months?

In the last 12 months, the M&A market increased and will continue to increase and consolidate, taking into consideration the foreign and local investments in Romania.

What are the common challenges relating to due diligence and obtaining specific information?

1. Changes in legislation. In Romania, some important laws in the fiscality field are amended very often which somewhat creates a fiscal instability. Based on these changes we have to verify if the agreements/documents have been issued in accordance with the law applicable at the date of the agreement.
2. The clients or their partners are reluctant to provide some information based on a lack of knowledge of GDPR law.
3. Some documents which are public, are not updated (fiscal information) and they are very hard to be obtained from the authorities.

How does competition law impact mergers? What is the legal process if the merging companies are not able to merge for competition reasons?

In case the companies which are subject to merger fulfil some conditions, it is compulsory to obtain the approval of the Romanian Competition Council.

Alexandru BADET

Managing Partner

Badet Alexandru Attorneys at Law

Str. Mitr. Andrei Saguna nr. 16

Sector 1, Bucuresti, Romania

Tel:         +40 744 930 808

Fax:        +40 21 31 05 306

Email:    alexandru.badet@badet.ro

Badet Law is a Romanian business law firm based in Bucharest, founded in 2013 by Alexandru Badet, a leading lawyer with a solid track record as senior associate and partner with international and local law firms.