Chapter IV - The Investor's Guidebook.

4.1. Registration of a Turkish liaison - office in Bucharest.

4.1.1. Institutional framework:

• Department of Foreign Trade by the Ministry of Foreign Affairs
• Chamber of Commerce and Industry of Romania
• General Department of Public Finance
• Ministry of Labour and Social Solidarity

4.1.2. Condition on opening the liaison office:

• Obtain the functioning licence from the Ministry of Commerce;
• Enlist in the records of the Chamber of Commerce, Ministry of Labour, General Department of Public Finance.

4.1.3. Deeds handed in the Ministry of Foreign Affairs:

a) Application for authorization that includes:

• foreign company's headoffice;
• liaison - office's activity in Romania, which shall be in compliance with the object in the country of origin;
• operating period of the liaison - office;
• number and position of the Romanian staff employed at the liaison - office;
• name and address in the country of origin, position of the foreign personnel that shall be employed.

b) Recommendation of the Chamber of Commerce in the country of origin about the applying company with the mention on its object of activity and equity.

c) Certified photocopies of the company's registration at the Trade Registry in Turkey.

d) Status of the company;

e) Power of attorney for the person authorized to legally represent the company.

f) Reference bank.

g) Confirmation of solvency from the bank by which it carries out its financial operations.

h) Proof of the paid stamp tax (USD 1,200).

All document in original are to be submitted to the Ministry of Foreign Affairs (or certified copy), translated and certified in Romania.

The Ministry of Foreign Affairs has to answer the application of authorization - issue the licence or reject it within 30 days since it was handed in. In case it was rejected, the applicant receives 80% out of the paid stamp tax.

The functioning licence consists of:

a) the object of activity;
b) conditions of fulfilling that activity;
c) duration;
d) headquarters.

4.1.4 Registrations after obtaining the functioning licence.

Within 15 days from the issued date of the functioning licence, the liaison - office must be registered:

• with the Chamber of Commerce and Industry of Romania, the original of the licence is stamped by CCIR that keeps one copy;
• with the Financial Administration which the liaison - office's headquarters belongs to and it will receive the payer VAT code for taxes; the liaison - office has to produce the following documents: original of the functioning licence stamped also within the Department of Liaison - offices within the General Department of Public Finance and State County Financial Control, copy of this stamped licence, two IMP 1.0 forms (one filled in with the data of the liaison - office and one with the data of the foreign company).

The renewal of this licence is done at the end of the authorized period, when it should be followed all above steps.

4.2. Company registration in Romania

The initial information on setting up a company in Romania can be obtained from the CCIRB liaison - office in Istanbul (www.ccir.ro/rep-tr)

4.2.1. Place of registration

The Chamber of Commerce and Industry of Romania and Bucharest Municipality or the territorial chamber of commerce and industry where the company has its headoffice.

4.2.2. Conditions of company registration in Romania:

a) formalities of setting up trading companies (www.onrc.ccir.ro):

• legal frame;
• minimum legal conditions of setting-up;
• contribution of capital;
• novelties in the field of setting-up trading companies;
• setting-up procedures;
• unique procedure;
• proving documents that have to be handed in the Trade Registry;
• previous advices;
• legal regim of branches and subsidiaries.

b) drawing-up and authentication of the by - laws at the Notary Office.

c) Forms (www.onrc.ccir.ro):

• Form of authorization and / or incorporation application;
• Form for mention enlisting.

d) Incorporation of the Trade Registry:

• obtaining the certificate of incorporation;
• obtaining the fiscal certificate.

e) Getting the necessary advices after incorporation (www.ccir.ro)

Note: All steps of registering a company in Romania can be carried on against commission through the Assisting Office for setting up and Developing the trading companies (One - Stop Shop) within the Chambers of Commerce and Industry.

4.3. Legislation

The most important laws concerning the foreign investors are:

• Law 31/1990 on trading companies;
• Law 26/1990 on trade register;
• GUO (Government Urgency Ordinance) 92 / 1997 on direct investment stimulation;
• GO (Government Ordinance) 70 / 1994 on profit tax;
• GUO 88/1997 on the privatization of the trading companies;
• Accountancy Law 82/1991;
• Law 84/1992 concerning the regime of the free zones;
• Law 64/1995 on the procedure of legal reorganization and bankruptcy;
• Law 83/1997 on the privatization of banking commercial companies in which the state is a shareholder;
• GUO 24/1998 concerning the regime of the unfavoured zones;
• GO 73/1999 regarding income tax;
• Law 133/1999 regarding the stimulation of the private entrepreneurs to set up and develop SMEs;
• Government Decision 244/15.02.2001 for the approval of the methodological norms for applying Law 133/1999;
• GO 66/1997 concerning the foreign investment in Romania, achieved by buying treasury bonds, with the subsequent alterations;
• Law 219/1998 on leasing;
• Law 52/1994 on securities and stock exchanges;
• Commercial Code;
• Banking law: Law 58/1998 and Law 101/1998;
• Law 134/21 July 2000 on the regime of industrial parks;
• Law 123/2001 concerning the regime of foreigners in Romania;
• Law 203/1999 concerning the permit of work; Urgency Ordinance 172/2000 that completes the law of the permit of work;

4.4. The domains opened towards investments are almost all economic sectors including natural resources, agriculture, industry, telecommunication, construction, research, trade, tourism, banks and insurance.

The investment is restricted in cases of:

• failure in the norms of environment protection;
• danger for the national security and defence;
• danger for public order, health and morals.

According to Law 219/1999 regarding leasing, public services, public transport, road transport, post, telecommunication, water/electricity distribution, thermal power, natural gas, exploitation of mineral resources can be transferred to the investors irrespective of their nationality, subject to governmental decision or the local body's decision.

4.5. Guarantees and rights of investors

• the righ to invest in any activity and under any legal trade means;
• equal treatment regardless their country of origin or their residence;
• guarantees against nationalization and expropriation;
• consultancy for administrative formalities;
• right of exchanging the local currency obtained from investments into foreign currency and transfering it abroad;
• right of settling the litigations at a competent Court or Arbitration;
• possibility of complying with the losses;
• right of employing foreign personnel according to the enforced legal provisions;
• possibility of taking part in the management and administration of the investment according to the company's status.

4.6. Institutional framework of business promotion Non-governmental organizations

The system of the chambers of commerce and industry in Romania.

• the Chamber of Commerce and Industry of Romania and Bucharest Municipality (CCIRB);
• a non-governmental organization of public utility, autonomous, with headquarters in Bucharest. Its target is to promote Romanian trade and industry at domestic and overseas level as well as to back up the Romanian businesspeople's interests in their relations with Romanian bodies and foreign organisms.

The CCIR members are businessmen - as volunteers and collective members (the territorial Chambers of Commerce and Industry associated or affilitated, professional associations, bilateral Chambers of Commerce).

Tasks:

• keep the Bucharest trade register;
• keep central trade register;
• assist the entrepreneurs to set up their trading companies;
• information supply and consultancy in business initiation and development;
• for export of Romanian goods, issue the certificates of origin, preferential customs certificates and temporary goods cards, with dutyfree as well as advise the invoices, proxies or other documets of foreign trade;
• based on documentation, issue certificates of force majeur;
• the International Commercial Arbitration Court carries out its activity the CCIRB;

Territorial Chambers of Commerce and Industry

Autonomous organizations, they mainly carry out the following activities:

• supports the development of the commercial and industrial activities of their members;
• carrys out commercial information and documentation activities;
• issue the certificates of origin for goods;
• support the achievement of the projects for developing trade and industry, including the free initiative projects;
• support their members' training;
• organize, at demand, ad-hoc arbitration.

The chambers of commerce and industry have the possibility to participate in the setting up of some companies with aim to render various services concerning their members, to organize and administrate fairs, exhibitions, to make commercials, to publish official bulletins and print information publication or commerical advertising.

Bilateral Chamber of Commerce

Non-Profit association that gather businesspeople interested in developing some business relations in certain zone or region. The bilateral Chambers of Commerce are united in the Union of the bilateral Chambers in Romania, which is also a member of the Chamber of Commerce and Industry of Romania.

Business incubators

Set up within some PHARE programmes, they offer the terms of business initiation and launching for the entrepreneurs who do not have enough financial resources.

Business Centers

Offer: training stages, business consultancy, assistance for drawing up the development projects, identifying business partners and supplying business information.

Ministries and governmental institutions

Romanian government site: http://www.guv.ro

Ministry of Development and Forecasting

Tasks:

• analyses the evolution of investments and elaborates strategies of attracting and promoting foreign investments in collaboration with the Department for relation with foreign investors within the Government;
• analyses the general economic development and regional development;
• elaborates economic forcasts and studies of long - term economic social development.
• site: www.mdp.ro

Authority of Privatization and Administrator of Government Sharing

Organized as a closed typical investment fund, an institution of public interest, the main responsibility of this authority is to sell the government shares or public local administration's. On their behalf it exercises all shareholder's rights at the trading companies.

The main tasks:

• based on the ratio between supply and demand it settles the negotiation and sale - at the market price - of the shares issued by the trading companies included in the annual privatization programme of Government;
• initiation or approval of selling the assets in the patrimony of the trading companies in which the state or on authority of local public administration is the main shareholder;
• settling of the privatization method for trading companies. It is used the principle of discentralization and, consequently, the trading companies belonging to small and medium enterprises are privatized at the level of Authority's territorial branches for privatization and administration of government shares (APAPS).
• site: www.sof.ro

Ministry of Small and Medium Enterprises and Co-operative System

The competence covers:

• elaborate and promote the policies of developing the private sector and programmes of developing and supporting the small and medium enterprises;
• promote the postprivatization policies;
• conclude contracts of technical assistance for achieving the programmes of the reform;
• administrate the funds assigned for investments and SMEs assistance;
• site: www.immc.ro

4.7. Sources of public information

National Institute of Statistics

The statistical and information data are available for public institutions and organisms, economic agents and all categories of population which show a legitimate interest.

Site: www.insse.ro

State Office of Patent and Trade - Mark (OSIM)

The unique authority in Romania that ensures the protection of industrial property. OSIM stores the national registers of the applications and title of protection granted for inventions, brands, trade marks, service marks, denominations of origin, industrial drawings and designs, utility patterns, integrated circuits surveys and the informatized database in the field of industrial property.

Site: www.osim.ro

4.8. Foreigners status (www.mae.ro)

4.8.1. Life conditions in Romania

• low criminalty;
• reasonable accommodations;
• rents paid in convertible currency lower than those paid in the origin country;
• international schools for children between 3 and 18 years old;
• restaurants and pubs with international and domestic cuisine at lower prices than elsewhere in Europe.

4.8.2. Basic principles

• All foreigners and non-residents of Romania have equal rights to the Romanian citizens.
• All foreigners need passport and visas issued by the diplomatic and consular offices of Romania, at borders and airports.
• Visa or multiple entrance-visa issued against payment.
• The following Romanian identity deeds are issued to the 14 years old foreigners:
  - identity card for the foreigners living as residents in Romania;
  - temporary card access for foreigners living in Romania for over 120 days.
• Children under 14 years old are written in their parent/supervisor's identity card.
• Deportation and extradition are settled by law.

4.8.3. Customs conditions for the cash flow and personal goods

• Allowed amounts of currency (cash flow) when coming to Romania

Foreigners coming to Romania are allowed to have maximum US$10,000/person/trip, being compelled to declare to the customs offices, at their demand, the cash flow and travelling cheques exceeding the above mentioned amount. The amounts exceeding this limit are lodged to the customs offices of Romania's border, being released within 3 years since their deposition.

• Allowed amounts of currency (cash flow) when going out Romania

Foreigners can leave Romania with maximum US$10,000/person/trip. The amounts exceeding this limit are lodged to the customs offices of Romania's border, being released within 3 years since their deposition, at return.

• Allowed ROL into/out of Romania

Foreigners can not come to/leave Romania with amounts in ROL exceeding 500,000 ROL/person/trip.

• Personal goods

Foreigners can bring to/take away from Romania personal goods at no customs charge within certain limits.

4.8.4. Work permit and residence

Foreigners and stateless persons who are to be hired by companies and persons with headquarters/living in Romania, are compelled to obtain a work permit issued by the Ministry of Labour and Social Solidarity.

The foreigners and stateless persons who are refugees in Romania are exempted from those provisions.

The work permit is generally valid for 6 months (until 31.07. or 31.12) and it is renewable. The residence permit is also valid for 6 months and renewable. Generally, the 6 - month visas with multiple entrances are issued altogether with the two permits.

• Documents required for the issue of work permit:
• Visa issue :

On company's behalf :

- formal letter to the Labour and Social Solidarity Ministry for requesting the approval of a work permit for the named forigner who is to be hired on a ceratin position(qualification), by mentioning the activity object of the company. The letter should also comprise the need of his hiring enclosed to the notice authorized by the Labour Chamber comprising the number of existing employees, both Romanians and foreigners.

- copies of the company's incorporation document and the liability letter (the last statement of account).

On foreigner's behalf :

• written demand for the issue of work permit;
• copy of passport (personal data and last Romanian visa);
• copy of the graduation document;
• criminal record (translated) (valid for 3 months);
• medical clearance proving that the foriegner is healthy and in good shape for work (valid 1 month); a fee of US$200 is paid. For the semestrial visa the fee is of US$50.

Required documents for the issue of semestrial visa :

• written demand sent by the company that claims the issue of this type of visa as the foreigner is continuing his activity;
• the copy of work contract registered with the Labour Chamber, with up-to-date excises owed to the state, signed and stampled by the managing director of Labour Chamber;
• formal letter from the Labour Chamber stating the number of Romanian and foreign employees;
• work permit in original.

Agreements of social support for companies

Certain agreements of social support for companies concluded between Romania and other countries stipulate an exemption of social assitance charges for the foreigners who work in Romania.

Foreign staff

When foreigners are hired by a Romanian company, all the rules and regulations of the Romanian Law are in force, as well as the stipulations of tax income and excises related to the hiring (less the excise to the unemployment fund).

When a Romanian company is hiring foreigners from transnational companies which come to Romania on the basis of a long-term agreement (over one year), each foreigner should be granted a work permit by the local authorities. At this stage, though, is not mandatory to be hired by a company from that locality. This fact does not alter significantly the taxation obligations, but it might have an impact over the social security obligations. The foreign stuff of multinational companies that come to Romania for a short-term period of time (without being hired by a company from that locality) must obtain a residence permit (card) and, maybe, a multiple-entrance visa.

4.8.5. Excises

The employer as well as the employee should pay to the social security and health system.
The percenatges paid by the employer and the employee, respectively, are based on the gross salary and are as follows:

Employee's excises :

• retirement fund 5%;
• unemployment fund 1%;
• health fund 7%.

Employer's excises :

• social security fund (CAS) - 30% up to 45%, related to the activity sectors;
• health fund 7%;
• social solidarity fund (handicap) 3%;
• education fund 2% since 1st of September, 1999 (Labour Chamber 1% for joint stock and limited liability companies) Labour Inspection;
• unemployment fund 5%.

System of export and import licenses (SITE ANEIR)
Customs regulations;
Customs tarrif;
Prohibitions si restrictions.
Main authorized activities :

Site www.just.ro
Site www.mfinante.ro
Site www.pwcglobal.ro
Site www.ro.kpmg.net

4.8.6. Taxes and taxations for the liaison - offices of foreign companies and foreign trade organizations

Liabilities of a foreign representative :

• its activity must be in compliance with the Romanian legal frame (economic-financial and currency system, public order);
• it keeps its own accountancy acc. to item 18 of Governmental Decision HG 704/1993 regarding the Regulation of the use of Accountancy Law 821/1991;
• it is operating through its currency accounts opened at Romanian banks according to the legislation in force and to the Currency Regulation issued by Romanian National Bank (BNR). The foreign companies and their representatives are fully responsible for the activity and documents of their representatives in Romania, as well as for the hired staff and damages inflicted by those on Romanian territory.

Taxes and taxations for the representatives :

• taxation on the building that belongs to the representative (according to the Decisions of Local Councils based on Law 27/1994 regarding the local taxations and taxes).
• taxes on the transport means (according to the Decisions of Local Councils based on Law 27/1994 regarding the local taxations and taxes).
• VAT for goods and services (VAT not returnable for those);
• taxation on representative's incomes: the taxable income can be deduced by 2 ways:

• 1. the taxable income is equal to the the difference between the the commissions granted by the mother companies and the expenses of the representative required by its activity (wages, rents, power supply, telephones, maintenance materials etc.) and proved by related deeds;
• 2. the following taxable incomes norms and their related taxation levels are settled according to the type of liaison - office:
  - type A (no. employees = 1-2) taxable income = 88.737.500 ROL
  - type B (no. employees = 3-5) taxable income = 277.585.500 ROL
  - type C (no. employees = 6-8) taxable income = 543.798.200 ROL
  - type D (no. employees = over 8) taxable income = 1.103.533.000ROL
• 3. percentage of income tax - 25%.

The taxation percentage on the liaison - officesincomes is of 25%.

The taxation percentage is applied to the maximum between the income norm settled for the type of liaison - office and the income calculated on the first method.

The contribution to the social securities budget is paid in foreign currency by the hiring company and it is of 25% applyable to the gross foreign currency wages fund of the employees.

Unemployment support Fund excise: 5% of the gross wages fund.
Health social securities excise: 7% of the gross wages fund.
Excise to the Social solidarity special Fund for handicaped persons: 3% of the gross wages fund (if Romanians are hired).
Excise to the Special Fund for the support of State: 2% of the gross wages fund (if Romanians are hired).

4.9. Assisted zones (www.mdp.ro)

Definition :

• represent geographic areas, with strict boundaries, that fulfill at least one of the following conditions:

a) they have productive mono-industrial infrastructures with more than 50% of the working population hired;
b) they are mining zones with over 25 % of discharged personnel by collective lay-out;
c) mass laying-out resulted of liquidation, restructures or privatization of some companies, which inficted over 25% of the employable inhabitants of that zone;
d) the unemployment rate exceeds with 30% the existing national average;
e) lonely zones without any communication means and with a weak infrastructure.

• boundaried acc. to line (1), can be owned by one or several administrative-territorial bodies.
• Incentives :
• customs tax and VAT exempted for all the repaid goods which are imported for the purpose of investment in those zones;
• VAT exempted for all repayable goods manufactured in Romania and purchased for the purpose of investments in unfavoured zones;
• customs tax exempted for the raw materials imported for the purpose of their own production in that zone;
• tax exemption on profit for the entire period of being unfavoured zones;
• tax exempted for changing the destination or for the agricultural disabilitation of the terrains for investments;
• funds allowance for the financing of special programs approved by Government's decision.

4.9.1. The list of assisted zones

In Tulcea county (South-East) - mining zone Altân Tepe (Stefan locality) is declared special zone by Government Decision HG 210/25.03.1999 between 01.04.1999-01.04.2009.

The interest fields for investments in this zone are as follows: agriculture and animal breeding, production, services, trade, environment preservation and protection.
Details regarding unfavoured zones on the site of the Ministry of Development and Forecasts.

4.9.2. Interest fields for investments in assisted zones

• Agriculture and animal breeding.
• Production, excepting the distilled alcoholic beverages and fermentation ethylic alcohol.
• Service rendering, excepting drinking eating places which does not make the object of an investment within tourism field.
• Trade, excepting the trade of products which are not the result of the activities developed in the zone.
• Environment protection and remaking of nature's sites.
• www.pwcglobal.com

4.10. Conditions required for the set-up and fuctioning of industrial parks ( www.mdp.ro)

This kind of title is granted to any joint stock company with headquarters in Romania and its sole activity object is the administration of industrial parks, company which fulfills the following minimal conditions:

1. to be the owner or to lease, for at least 25 years, the sites of the industrial park;
   
2. to submit a feasibility study and a business plan for, at least, the next 3 years, regarding the exploitation of the industrial park;
   
3. according to the formal deeds, the number of juridical persons which follows to operate in the industrial park should be at least 5, and, after the development of the related activites, within maximum 3 years, to be created at least 300 working places;
   
4. to forward an average balance comprising the tasks which must be fulfilled in order to operate in the industrial park, in full compliance with the legal requirements in force regarding the environment's protection;
   
5. to submit the agreement of the local and county council, of the Bucharest General Council, depending on situation, agreement valid for the industrial park's entire duration, as well as the principle agreement of the Council for the region development regarding the economic-social development program proposed for being granted the title of industrial park, for operating and developing the related activities, for implementing the region objectives respectively.

Incentives granted to companies working in the industrial park:

1. import customs tax and VAT exempted for the machines, tools, outfits, transport means, agricultural tools and outfits and other repayable goods required by investments;
2. customs tax and VAT exempted at the import of raw materials, spare parts and components used at the erection, reparing and maintenance of the park's faclities;
3. exempted from taxation on the profit re-invested in the up-grading of techonologies, development of industrial infrastructure, supporting of investment objects of the park, for a period of 5 years since it's set-up;
4. co-financing, with or without redemption, from funds of industrial park's development, up to max. 25% out of the value of investment necessary to finish the infrastructure and to secure the needs of the industrial park, excepting the abroad funds, situation when the abroad financer settles the limit of co-financing;
5. payment in installments of the local taxations and taxes, according to the decisions of the local and county councils to which territory and administrative jurisdiction the park belong, for 5 years at the most;
6. The chambers of commerce and industry in cooperation with the entitled public institutions shall secure the issue of notices, authorizations and licenses of functioning required by the activities of industrial parks.

4.11. Incentives for free zones

• Legal basis : Law 84/1992 with alterations;
• Available at the moment on location in Sulina, Constanta South, Basarabi, Galati, Giurgiu, Braila and Curtici.
• Tax incentives granted by the free zones:
• exemption of taxation on profit and excises for the activities developed in the free zone;
• VAT exempted for certain operations taking place in the free zone.
• Customs conditions: all the goods brought in and taken out of the free zone are customs tax exempted.
• The limit of time over the tax benefits is of 50 years (The ceasing agreement for being in zone is limited toof 50 years ).

4.12. Incentives granted to private entrepreneurs for the set-up and development of SMEs

Link www.immc.ro

a) The small and medium sized enterprises which are dealing with goods production and services are defined as follows, considering the annual written average number of employees:

• up to 9 employees - micro-enterprises;
• between 10 and 49 employees - small-sized enterprises;
• between 50 and 249 employees - medium-sized enterprises .

Achieves an annual turnover equivalent to 8 mill. Euro.

b) Incentives are not granted to banking companies, insurance and re-insurance companies, companies of managing the investment funds, stock exchanges and companaies of foreign trade exclusively.
c) The enterprises with stock holder or share holder being another company and which are fulfilling the folllowing 2 conditions altogether are not the beneficiaries of this law:
b) have over 250 employees;
c) own over 25% of the equity.
d) The enterpises prove that they are small or medium-sized ones by:

• the evidence of annual written average number of employees legally issued by the Labour Chamber under which jurisdiction the enterprise is, based on the written average number reported the pervious year;
• the evidence of annual turnover issued by the Finacial administration under which territorial jurisdiction the enterprise stands, based on the data of the balance-sheet of the last ended tax year.

e) For the SMEs set-up this year it will be considered the period of time between the set-up date and the date of issue of related evidence, based on the own liability statement of the legal representative of those.
f) For the evidence of turnover it is used the exchange rate of Euro on 31st of December of the previous year, rate established by the Romanian National Bank (RNB).

4.12.1. Incentives granted to SMEs :

• discounts up to 50% for the criteriA related to the turnover and guarantees requested in public auctions of goods, buildings and services.
• customs tax exempted for machines, installations and industrial outfits, know-how which are imported in order to develop their production and services activities and which are paid from their own funds or from credits granted by Romanian or foreign banks;
• the share of the re-invested gross profit is not taxable;
• decreasing of the taxation on profit with approx. 20% when the enterprises new workplaces, provided for the increase of the written number of employees with at least 10% more than the previous financial.
• customs tax exempted at the import of raw materials used in enterprises' production, providing that the products obtained are themselves customs tax exempted.

The list of customs tax exempted products is annually approved by decision of Government.

4.13. Privatization

The legal body for privatization and managing of the state participations has privatized 7,165 state companies representing a capital of over 30.000 bn ROL and 1.5 mill. employees.

The most important sectors which have been privatized: metallurgy, refineries, building materials, constructions, textiles, food industry, packaging, plastics industry..

4.14. Taxes and taxations for companies

Taxation on agricultural income
Taxation on buildings
Taxation on site
Taxes for the transport means

Taxes for using the state's land for other purposes than agriculture and forestry

4.15. Taxes and taxations for natural people:

Direct taxations : (authorization taxes and tarrifs, customs taxes charged at border, consular taxes etc.)

Taxation on the incomes obtained in Romania by non-resident persons and companies:
Taxation on the incomes of foreign companies in Romania:

A. Taxation on profit

The taxable profit is calculated as difference between the taxable incomes (resulted from the delivery of personal goods, rendered services, finished works, from the sale of personal goods, rendered services, finished works, form the sale of real estates, as well as any other gain) and non-taxable expenses (made in order to achieve the above mentioned incomes) in a fiscal year, out of which are deducted the non-taxable incomes and are added the taxable expenses. From this calculated taxable profits reduced the possible tax loss of the previous years and the final result would be the taxable profit of current financial year.

The accounting evidence is kept in full compliance with the Accounting Law 82/1991 and its provisions.

Tax alleviations - in force since 1.01.2000

• the calculation from the taxable profit related to the finacial year of a 10% share of the purchasing price of both the technologic equipment (machinery, tools and outfits) and the transport means (excepting the cars); this operation is done during the acquisition month, extra-accounting, only in respect to the tax, by registering with the amounts imposed declaration of those amounts as a non-taxable expenses.
• payment of a taxation on profit reduced quota of 5% for the share of the taxable profit which is related to the percentage of incomes resulted from the export of their own goods and cashed in foreign currency in total volume of incomes; the same quote is considered for the services rendered to the foreign beneficiaries; the deduction is monthly calculated and is distributed as their own financing sources; in order to benefit of this alleviation, the taxpayers should fulfill the following conditions:
• the incomes resulted from exports should be cashed in foreign currency through a bank account opened in Romania; the lohn operations are included in here as well, providing that these are proved by documents required when VAT is also repaid; tourism for foreigners, non-resident persons and companies; operations sustained by the concluded contracts and their related invoices;
• the goods must be of own production; their export can be done either as exporter or by a commission agreement;
• the services rendering should result from their own activity.
• payment of a reduced quoto on profit taxation- for the protected companies - of 5% providing that at least 50% of the gained profit is re-invested for: purchase of technological equipment; creating special and protected work places in compliance with the legal provisions (the protected companies are those in compliance with the Emergency Ordinance of Government OUG 40/2000 (the alteration of OUG 102/1999) regarding the special protection and hiring of persons with handicap).