(The Order of the NAFA’s president no. 1.400/21 September 2012 regarding the registration procedure of the agreements/ documentation concluded between Romanian legal entities, resident individuals, Romanian permanent establishments of foreign legal entities and foreign legal entities or non-resident individuals, published in the Official Gazette no. 695/10 October 2012)

The new order brings inter-alia the following amendments:

(1) the category of qualifying taxpayers with liabilities to register contracts/documents was broadened, by adding to the scope resident individuals and Romanian permanent establishments of non-resident legal entities.

(2) not only the contracts for services that may create a permanent establishment in Romania have to be registered, but any agreement for any type of services performed in Romania and which generate taxable income.

(3) in case there is no written agreement signed between the parties, any documents attesting the effective provision of services in Romania should be registered, such as statements of works, delivery reports, work reports, feasibility studies, market surveys or any other corresponding documentation.

The registration process remains similar to the previous rule and it should be performed within 30 days from the agreement signing date or document delivery. The documents to sustain the information inserted in the statement are not required to be attached.

Failure to comply with the registration of the agreements/ documents triggers a fine between RON 500 – RON 1,000 for individuals and a fine between RON 1,000 – 5,000 for legal entities.

By Venkatesh Srinivasan, Partner – Head of Tax and Legal, Ernst & Young Romania 

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