Foreign Investment Control in Romania

Approval Requirements For Foreign Corporate Investments in Romania

More and more countries are tightening regulations for foreign investors that intend to acquire stakes in companies. Ana Chira  (Attorney at Bulboaca based in Bucharest) describes the legal situation in Romania and sheds light on the consequences for corporate investments there.

In Romania, a Government emergency ordinance with respect to foreign investments is currently pending approval. The ordinance aims to implement the provisions of the Regulation (EU) 2019/452 of the European Parliament and of the Council of 19 March 2019 establishing a framework for the screening of foreign direct investments into the Union.

The ordinance provides the establishment of a national commission for the examination of FDIs formed by representatives of the government, presidential administration, ministries, secret services and the competition authority. Also, according to the draft ordinance, subject to authorization are FDIs whose value exceeds EUR 2 million having as object sensible domains, such as security of citizens, frontiers, energy, transport and critical infrastructure are. Further, FDIs under EUR 2 million could be subject to authorization, if, through their nature, they are deemed to affect the national security and public order.

Romania was among the EU member states which already had in place a mechanism of examination of investments, whose objective was to maintain national security and public order, as certain transactions were subject to the approval of the Supreme Defence Council. Also, in recent years, FDIs in Romania have known an upward trend – according to a report of the National Bank of Romania, FDIs in Romania exceeded EUR 5 billion for two consecutive years. Most attractive sectors are trade, industry, financial intermediations and insurance and IT&C.