Romanian lawyer Remus Borza, the former judiciary administrator of Romania's largest energy producer Hidroelectrica, and currently chairman of the board with the company, is subject to an investigation on grounds of conflict of interests. Borza is being accused of having made payments via his insolvency company Euro Insol to his law firm, based on legal assistance contracts, during the period when Euro Insol was the judiciary administrator of the state – owned company Hidroelectrica.

The lawyer however says the investigation is an error, as his activity as insolvency practitioner or lawyer cannot be considered a public sector job, where the conflict of interest can be applied.

The legal services offered by his law firm to the insolvency company concerned canceling energy contracts with the so called 'smart guys', who bought cheap energy from the state, to re-sell it at much higher prices.

“The services were given to Euro Insol, and not to Hidroelectrica. We had a material gain, we cashed in EUR 100,000, but we managed to win in 75 appeal cases against traders,” Borza explained. The budget for these appeals was of EUR 220,000, but only EUR 100,000 was spent. The lawyer added that everything he did as judiciary administrator at Hidroelectrica was approved by the group of creditors, who could have appealed his decisions.

He added that high level authorities knew of all the measures taken by Euro Insol at Hidroelectrica, including the country's president, Prime Minister, and members of the Government. “It is the peak of hypocrisy to say now it was a conflict of interest. […] For 371 days I have been doing everything transparently,” Borza explained.

“Everything was made via a transparent and competitive procedure, always following the public interest. Not by chance I announced on June 26 Hidroeletrica's insolvency exit. On the same day, the IMF board was meeting to discuss a new agreement with Romania. Had I not solved all the appeals by June 26, Hidroelectrica would have not been out of insolvency, and if not out of insolvency, it would have been bankrupt in fall,” the lawyer further explained.

Hidroelectrica was under insolvency for a year, between June 2012 and June 2013, during which Euro Insol made 34 payments to Borza's law firm, Borza & Asociatii, according to investigators. According to information in the media, Borza's Euro Insol was to receive a EUR 2.2 million fee for steering the state – owned company out of insolvency.

Hidroelectrica recorded a profit of around EUR 109 million (RON 481 million) in the first half of 2013, compared to a loss of RON 202 million reported in the same period in 2012, according to the company. The energy producer had a turnover of around EUR 383 million (RON 1.6 billion) in the first six months of this year, up 33 percent over the same period in 2012.

editor@romania-insider.com