The performance of the Romanian economy in recent years keeps Romania on the map of investors, even if, strictly in terms of figures, we cannot speak of a recovery of the level of investments compared to the reference year 2008 (9.5 billion Euros). In 2016, the total direct foreign investments increased to 4.8 billion Euros, compared to 2015 (3.035 billion Euros). Also, despite some signals from financial institutions or, more recently, from Moody's rating agency, which lowered the country's rating from positive to stable, namely because of its fiscal policy that led to an increase in the tax deficit, there are enough reasons to remain optimistic about attracting foreign investments. Romania is still waiting for significant M&A transactions and there is so much to be done in the field of State investments, said Mrs. Loredana Van de WAART, Partner, Gruia Dufaut Law Office, in an interview with newspaper Nine O’Clock, April 27, 2017.
Here, the full interview:
Due to the nature of your activity, you are permanently connected to the concerns of the investors coming to Romania. How do they view Romania’s economic evolution and especially the investment framework in this country?
The performance of the Romanian economy in recent years keeps Romania on the map of investors, even if, strictly in terms of figures, we cannot speak of a recovery of the level of investments compared to the reference year 2008 (9.5 billion Euros). In 2016, the total direct foreign investments increased to 4.8 billion Euros, compared to 2015 (3.035 billion Euros). Also, despite some signals from financial institutions or, more recently, from Moody's rating agency, which lowered the country's rating from positive to stable, namely because of its fiscal policy that led to an increase in the tax deficit, there are enough reasons to remain optimistic about attracting foreign investments.
Romania is still waiting for significant M&A transactions and there is so much to be done in the field of State investments. It is only up to the Romanian officials to prioritize projects, better manage resources and provide more guarantees in terms of stability and predictability, in order to make Romania more attractive to investors.
As far as the investment framework is concerned, we can also talk about a significant improvement in 2016. I am particularly mindful of the implementation of the new Public Procurement law package and the new PPP law. There are also various tax incentives that have been granted to investors - both foreign and Romanian - which entered into force last year and can contribute to the increase of investments over the next few years. Of course, if the rules do not change overnight. I refer particularly to State aid schemes for investments in certain regions of the country or to the three categories of facilities granted to companies carrying out research and development activities: tax exemption on salaries of employees involved in such activities, additional 50% tax deduction from the value of research and development expenditures and the exemption from the tax on profit for a 10 year period for innovation centers, namely companies that carry out such activities exclusively.
We know you have a special relationship with the Netherlands, to whom we dedicate this special edition. What can Romania do to attract more Dutch investments and what should the Romanian entrepreneurs know about their Dutch counterparts?
I am indeed close to the Dutch community in Romania, both due to my activity at the GRUIA DUFAUT Law Office, where we work with Dutch investors, as well as due to my family ties. My husband is Dutch and a businessman, an investor in Romania. This has allowed me, of course, to better know the Dutch, as a people, to know their habits and the way they relate to certain values. At the same time, I had the opportunity to better understand the business approach of Dutch companies and their economic model.
The Dutch economy has a significant dimension and, at the same time, it is one of the most dynamic poles of the EU, both in commercial and industrial terms. But besides the excellent reputation of the Dutch in the art of trade, they are also champions of innovation in many economic sectors. The Netherlands is a reservoir of research and development centers, in sectors such as agro-food, high-tech systems and materials, chemicals and health, IT. Therefore, Romania could draw lessons from the Dutch model and adopt a range of Dutch economic, tax, development or education policies, in order to boost research, innovation and development in Romania.
How does the Law Office support businessmen when they consider an investment in Romania?
We are by their side from the very first moments, when they elaborate their strategy in order to enter the market or when they develop their business locally. We firstly provide them with analyses on all relevant legal aspects and on how they can protect their investments.
By our actions, we try to make investors understand the local legal peculiarities and, on the other hand, offer them the most profitable, economic and legal solutions for the business they plan. We have a significant technical experience in providing legal advice on foreign investments and then, with a double perspective on European and Romanian regulations, we can guide investors - especially French, Dutch, but also Italian, Belgian, Swiss etc. - so that they become aware of market particularities and achieve successful operations. The quality of our work derives mainly from our principles and values: proximity, solutions, integrity and creativity. We promptly develop innovative solutions to complex legal issues, taking into account our clients’ objectives and using our legal know-how to their best interests. At GRUIA DUFAUT, searching for pragmatic, rigorous and business orientated solutions for each client is a must. We are also committed to consistent moral and ethical standards in all our operations.
Bucharest, April 28, 2017www.gruiadufaut.com
GRUIA DUFAUT is a full-service law firm having two offices in Paris (France) and Bucharest (Romania), which cover all business legal areas, with particular emphasis on corporate, M&A, real estate, employment, public procurement transactions and dispute resolution. Since 1991 GRUIA DUFAUT has been advising and assisting foreign investors in entering the Romanian market, during negotiations and commercial transactions, in their daily operations or during all stages of their investment and development projects. The law firm also has a team of litigators, who represent and defend clients’ interests before any Romanian or European court.