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Legal developments

New Insolvency Code – continued uncertainty

The proposal for a new legislation on pre-insolvency and insolvency proceedings (the Insolvency Code) mentioned in the Legal and Regulatory Risk Note from October 2013 has been adopted by the Romanian Government.

However, shortly after its coming into force on 25 October 2013, the entire Insolvency Code was ruled unconstitutional by the Constitutional Court and therefore is no longer in effect. The main reason for the ruling was that the Insolvency Code was passed as a Government Emergency Ordinance (which is passed by the Government) and not as a law (which is passed by the Parliament).

The former legislation shall apply until a new form of the Insolvency Code is adopted. A new form of the Insolvency Code is currently the subject of Parliamentary debate and, except for some minor changes, at this stage, it seems that the new draft is generally in line with the previous form of the Insolvency Code. The new Insolvency Code is generally pro-creditor oriented, making the judicial restructuring more restrictive and allowing for more expedient liquidation procedures.

Implementation of the CRD IV package in Romania

Romanian legislation has been amended to reflect the requirements of the CRD IV package. To this end, the following pieces of legislation have been passed: (i) the NBR Regulation No 5/2013 on prudential requirements for credit institutions (which repeals, among others, the previous NBR Regulation No 18/2009 on the standards for internal administration, capital adequacy and outsourcing, as amended); and (ii) the Government Emergency Ordinance No 113/2013 for the amendment of the Government Emergency Ordinance No 99/2006 on credit institutions and capital adequacy.

Reduction of the number of Green Certificates and further amendments to the renewable legislation

A new government decision implementing the reduction of the number of Green Certificates (GC) has been passed in December 2013 (the Decision). The Decision provides the various reduction measures applicable to producers accredited after 1 January 2014. Further amendments to the renewables legislation have been passed by the Romanian Parliament, but such changes are still not effective, being subject to promulgation by the President and publication in the Official Gazette.

Legal and Regulatory Risk Note