I. Technical unemployment: simplification of the implementation and
regulation of the procedure for granting state aid – (Emergency Ordinance
No 32/2020, valid from 30.03.2020)
In the last newsletter we informed that during the State of Emergency, in case of temporary
suspension of the individual employment contract on the initiative of the employer (technical
unemployment) in case of temporary interruption or reduction of activity, the employees’
remuneration is set at 75% of the basic salary and it is financed from the unemployment
insurance budget, but not more than 75% of the average gross salary.
The new Regulation 32/2020 now changes the conditions for granting state aid for technical
unemployment to the effect that during the state of emergency this aid is requested solely on
the basis of a declaration on the employer’s own responsibility.
At the same time, some of the conditions originally imposed for the granting of technical
unemployment are removed, namely
the requirement to present an emergency certificate is removed
the conditions relating to financial indicators to be met no longer apply
the limitation in relation to the number of employees for which it can be granted is no longer
applicable.
The procedure for granting state aid for technical unemployment is as follows:
The employer demands the gross amount for each employee by means of a request.
The aid granted is subject to income tax, pension and health insurance and is withheld by
the employer from the state aid received. The employment insurance (employer’s
contribution CAM) is not to be paid.
The application for state aid is submitted electronically to the employment agencies,
together with the list of beneficiaries and the declaration signed and accepted by the legal
representative on his or her own responsibility.
Employers assume responsibility for the accuracy and veracity of the data entered in the
submitted documents.
The payment of the state aid from the unemployment insurance budget is made no later
than 15 days after the application is submitted to the opened bank accounts.
The employer must pay the received state aid to the employees within 3 working days of
receipt.
Additional provisions
Employees who have concluded several employment contracts, of which at least one
remains active full-time during the period of the state of emergency, do not receive state
aid.
Employees who have concluded several employment contracts, all of which have been
terminated, are entitled to state aid for the most advantageous employment contract.
If the employer’s budget allows, the employer may supplement the assistance by the
difference up to 75% of the gross basic salary, provided that this is higher than the average
Romanian salary.
During the period of technical unemployment, the employee remains covered by sickness
insurance and may apply for sick leave without paying the contribution to the sickness
insurance fund.
The regulation provides that other professionals, as defined in the Civil Code, Art. 3,
paragraph (2), who interrupt their activity due to the effects of the epidemic during the state
of emergency, are also entitled to receive a monthly allowance equal to 75% of the average
gross basic salary from the state budget. This includes, for example, natural persons who
receive income exclusively from copyright or from individual employment agreements
within the framework of associations as defined in Law 1/2005, or sportsmen as defined
in Law 69/2000.
II. Child-raising allowance (EO 32/2020 – valid from 30.03.2020)
The child-raising allowance is paid for the entire duration of the state of emergency, even if
the child has reached the age of two or three in the case of a child with disabilities or will reach
that age during that period.
III. Tax reductions are granted to taxpayers who pay their taxes on time (EO
No. 33 – valid from 30.03.2020)
Profit taxpayers will receive a tax reduction for the 1st quarter of 2020 if the payment is made
up to and including 25 April 2020:
– Large taxpayers will receive a 5% reduction in profit tax;
– Medium-sized companies will receive a 10% profit tax reduction;
– Other taxpayers will also receive a 10% reduction in profit tax.
Companies paying specific taxes are also entitled to a reduction of the specific tax for
the first quarter of 2020, 5% for large taxpayers and 10% for other taxpayers.
Companies paying micro-enterprise tax will receive a tax bonus of 10% for the first quarter
of 2020 if the payment is made up to and including 25 April 2020.
Profit taxpayers will report the profit tax reduction separately in the annual profit tax return.
From a technical point of view, when preparing the quarterly tax return, both profit taxpayers
and micro-enterprise taxpayers will have to declare the amount after deduction of the
reduction.
IV. Introduction of the reverse charge procedure for imported goods used for
coronavirus control (DO No. 33 – valid from 30.03.2020)
Taxable persons registered as VAT payers under Article 316 of the Tax Code (registration for
normal VAT purposes) now apply the reverse charge procedure when they import goods used
to combat the coronavirus pandemic, such as test kits for COVID-19, protective clothing,
thermometers, disinfectants, sterilisation products.
V. Extending the validity of holiday vouchers (DO No. 35 – valid from
30.03.2020)
The validity of holiday vouchers issued between March 2019 and December 2019 shall be
extended until 31 May 2021. Holiday vouchers will be issued electronically only in 2020.
VI. Facilitations for the repayment of loan instalments (EO No.37-valid from
30.03.2020)
The possibility of deferring due instalments, including financial leasing instalments, is
introduced. Borrowers whose incomes are affected by the COVID 19 pandemic and who are
unable to pay the loan instalments can thus defer them until 31 December 2020 at the latest.
This deferral can be used if the following conditions are met:
– The credit agreements must have been concluded before the entry into force of the
Emergency Ordinance
– The loan instalments were not due when the Emergency Ordinance entered into force
– The borrowers were not in default of payment at the time of the declaration of the state of
emergency (16.03.2020) or the outstanding payments were made up by him by the date
of the application for suspension of instalments.
– Natural persons must be directly or indirectly affected by the COVID 19 crisis
Legal persons may benefit from the measure only if
– They are not insolvent at the time of the application for suspension of repayment of the
credit
– They have had to suspend their activity in whole or in part due to decisions of public
authorities during the state of emergency and they are in possession of an emergency
certificate issued by the Ministry of Economy, Energy and Business Environment
The deferral of payment shall be requested as follows:
– Submission of an application to the Bank in letter format, by electronic means or by
telephone using a special telephone number listed on the creditor’s website
– Submission of the application within 45 days of the entry into force of Emergency
Ordinance 37/2020
– The creditor’s analysis and approval of the application is based on the (not yet published)
application guidelines for Emergency Ordinance 37/2020
– In the event of approval, the duration of the contract is extended from the date of
submission of the application to the creditor.
If the suspension of instalments for 9 months is approved, this will have the following
consequences:
– During the suspension period (maximum 9 months, but not more than until 31.12.2020)
the debtor does not make any payments (principal, interest, commissions) in connection
with the relevant liabilities to banks
– The repayment periods of the loans are automatically extended by the period of
suspension of the instalments
– Interest during the suspension period is added to the main loan and is staggered until the
new term of the loans (except for mortgage loans of private borrowers).
– The loan amounts are thus increased by the interest charged on existing loans during the
suspension period
– At the end of the suspension period, the debtor pays interest on the new value of the
suspended loans. This does not apply to mortgage loans of natural persons for which the
interest for the suspension period is scaled with 0 interest in a separate loan with a term
not exceeding 5 years.
– Bank charges in connection with the loans are not capitalised and not charged during the
9 months.
– The contracts are amended by the effect of the law without the conclusion of additional
annexes to the contracts. Within 30 days of receipt of the application, the creditor shall
notify the debtor of the contractual clauses amended in accordance with the contract in
accordance with the present Emergency Ordinance.
The Ministry of Finance will issue implementing regulations within 15 days of publication of
Emergency Ordinance No 37/2020.
VII. Procedure for granting an emergency certificate (DO – No 791/2020 valid
from 25.03.2020)
During the state of emergency in Romania, economic operators whose activities are affected
by the SARS-CoV-2 pandemic may apply for emergency certificates to be issued by the
Ministry of Economy, Energy and Business Environment.
This can be used both in relations with public institutions for obtaining benefits or support
measures, for deferring payments to utilities, electricity, natural gas, water, telephone and
internet services, the rent for the building used as the head office and secondary offices under
the conditions indicated, and in relations with business partners.
Emergency certificates shall be issued in two forms, whereby an applicant may apply for the
issue of only one type:
(a) TYPE 1 (BLUE) – for applicants on the basis of a declaration made under their own
responsibility stating that their activity has been totally or partially suspended due to decisions
of the competent authorities, in accordance with the law, during the declared state of
emergency This type applies to companies affected by the provisions of the military
ordinances as a result of the suspension of activity, for example companies with the following
activities: hotel and restaurant businesses, gambling, spa treatments and personal hygiene,
event organisers, etc.
(b) TYPE 2 (YELLOW) – for applicants on the basis of a declaration made under their own
responsibility showing a decrease in deposits in the month of March 2020 of at least 25%
compared to the average of deposits in the period January to February 2020.
The application for the emergency certificate by the applicant shall be made exclusively
electronically via the platform http://prevenire.gov.ro/ and shall be submitted together with the
following information and documents:
(a) identification data
b) the declaration on the legal representative’s own responsibility, certifying that all the
information and documents on which the application for the certificate is based correspond to the reality and are in compliance with the applicable legislation regarding the type of certificate
requested, the total or partial suspension of activity or the reduction of deposits in the indicated
proportion. The model of the declaration on your own responsibility is published on the
http://prevenire.gov.ro platform.
All these documents are uploaded to the http://prevenire.gov.ro platform under the electronic
signature of the legal representative or an authorised representative of the legal representative
who has an electronic signature. Therefore, if the applicant’s legal representative does not
have an electronic signature, he/she can sign by hand, and all documents
http://prevenire.gov.ro (including the declaration on his/her own responsibility) will be
uploaded and electronically signed by the designated authorised representative.
The emergency certificates are created automatically, electronically, issued after the system
has validated the application and are valid without signature and stamp.