Government Emergency Ordinance
No. 88/1997on the privatization of commercial companies as amended and completed by Law No. 99/ 27.05.1999 regarding certain measures for the acceleration of the economic reform
Art. I – The Government Emergency Ordinance No. 88/1997 on the privatization of commercial companies, published in the Official Gazette of Romania, Part. I, No. 381 from December 29, 1997, approved by the Law No. 44/1998, published in the Official Gazette of Romania, Part I, No. 88 from February 25, 1998, as subsequently amended, is modified and completed, as follows:
Chapter I
General Provisions
Art. 1 - This Emergency Ordinance sets up the legal framework for the acceleration and completion of the privatization process, based on the following principles:a) the insurance of the transparency of the privatization process;
b) formation of the sales price, based on demand and supply;
c) equal treatment of the buyers;
d) reconsidering the outstanding debts of the companies in order to increase the attractiveness of the privatization offer.
Art. 2 - The provisions of this Emergency Ordinance shall apply to:
a) the sale of shares in case of companies where the state or a local public administration authority is a shareholder, irrespective of the stock it holds, including the national companies, national corporations and other companies resulted from the reorganization of regies autonomous of national or local interest;
b) the sale of assets of regies autonomous and of companies where the state or a local public administration authority is a majority shareholder, including the national companies, the national corporations and other companies resulted from the reorganization of regie autonomous of national or local interest.
Art. 3 – For the purposes of this Emergency Ordinance, the terms and notions set forth below shall have the following meanings:
a) companies means the companies formed in accordance with the provisions of Law No.15/1990 Regarding the Reorganization of the State Enterprises as Regies Autonomous and Commercial Companies, as subsequently amended, the companies formed by the local public administration authorities under the Local Public Administration Law No.69/1991, as republished and subsequently modified, national companies, national corporations and other companies resulted from the reorganization of the regies autonomous of national or public interest;
b) company of strategic interest means national companies and national corporations; other companies in which the state owns the majority interest may be declared of strategic interest by Government Decision;
c) shares are securities issued by companies; the shares can be ordinary or preferred shares in compliance with the provisions of Law No. 31/1990 Regarding the Commercial Companies, as subsequently amended;
d) assets means properties or group of properties owned by a company or by a regie autonomous, which can be separated and organized as to operate independently, distinctly from the rest of the activity of the company or of the regie, such as production, trading or service providing units and sub-units, sections, workshops, farms, trading facilities, accommodation locations, public nourishment and office facilities or other similar assets, including the land attached to these properties,
e) buyer means any Romanian or foreign, individual or legal entity. The buyer cannot be a Romanian entity of public law or a company in which the Romanian State or a local public administrative authority holds more than 33% of the total stock of voting shares in the General Meeting of Shareholders;
f) relevant ministry is the ministry or the central public authority in the field of which falls the main object of the activity of a company or under the authority of which is placed a regie autonomous;
g) public institution involved means the State Ownership Fund or any relevant ministry or, as the case may be, a local public administrative authority responsible for the privatization of a commercial company;
h) the competent environmental authority is the Ministry of Waters, Forests and Environmental Protection or a local environment agency under the authority of this ministry;
i) presentation file means the aggregate of the data and information regarding a company or an asset, which have been supplied in written form to the potential buyer of the shares of the company or of the assets;
j) environmental obligations means a minimum set of obligations, incumbent on a company that is to be privatized or which are transferred together with the asset to be sold, from which derives the obligation of conformation with the laws regarding the environmental protection and which shall be included by the public institution involved in the presentation file or in the public offer prospectus. Such obligations are set by the competent environmental authority, based upon the environmental report prepared within the privatization process or the process of sale of an asset whose utilization has impact on the environmental. The environmental report shall be prepared in the conditions set forth by the methodological norms, issued in accordance with the provisions of this emergency ordinance;
k) privatization agent means any Romanian or foreign legal entity specialized in financial activity, such as banking corporations, investment corporations and funds, financial companies, firms providing accountancy services, consulting, services of intermediation on the securities’ market or of liquidation and distribution of the assets, as well as law offices or professional law associations, irrespective of whether they act in their individual capacity or in association, provided that each foreign legal entity may act in association with a Romanian legal entity included in one of the above-mentioned categories;
l) operational closure means the overall technical and organizational operations undertaken by the administrators or, as the case may be, by the liquidators of the companies in which the state holds a majority interest, empowered in this respect by the General Meeting of the Shareholders or by the Board of Administration, in order to cease the company’s economic activity and to preserve its assets or other goods until their sale according to this Emergency Ordinance; the operational closure can be full or partial, final or temporary;
m) budgetary obligations means obligations resulted from taxes, contributions or other budgetary revenues, including the related incremental default interests or penalties and interests to the credits guaranteed by the state, which are due to the state budget, the state social insurance budget, the local budgets and the special funds budgets;
n) budgetary creditor is the holder of the right corresponding to a budgetary obligation.
Chapter II
The Competencies and Attributions of the Government, the Romanian Development Agency and the public institutions involved
Art. 4 - The competencies and attributions relating to the privatization process are vested in the Government, the Romanian Development Agency and the public institutions involved.Art. 5 - (1) The Government ensures the implementation of the privatization policy, coordinates and controls the activity of the ministries and of the public institutions which have competencies and attributions in effecting privatization and takes mandatory measures for the acceleration and completion of the privatization process and is liable before the Parliament for the fulfillment of such obligations.
(2) For this purpose, the Government:
a) approves the national strategy of privatization;
b) approves the main terms of the mandate for, including the method of sale and the main terms of the sale-purchase agreement to be concluded by the public institutions involved or, as applicable, by the companies, for the shares issued or the assets owned by a company of strategic interest;
c) grants, on a case by case basis, exemptions, reductions, postponements and/or rescheduling of the payment of any budgetary obligations, based on the proposals submitted by the budgetary creditors or by the public institution involved;
d) takes any other measures in it s capacity as central authority for the implementation of this emergency ordinance.
Art. 6- (1) The Romanian Development Agency elaborates and promotes the strategy for privatization.
(2) For this purpose, the Romanian Development Agency:
a) drafts and submits for Government approval the national strategy of privatization provided under art. 41 par. (2) lett. a), based on proposals of the public institutions involved, for ensuring co-relation with their development strategies;
b) drafts and submits for Government approval drafts of legislation in the field of privatization;
c) can provide technical assistance with respect to privatization;
d) draws and promotes foreign investments for the purpose of privatization of companies;
e) drafts and submits for Government approval the annual report regarding the stage of the privatization process, based on the reports of activity prepared by the public institutions involved;
f) centralizes the data regarding the performance of the sale-purchase contracts of the shares owned by the state or by the public administrative authorities and inform the Government in this respect.
(3) For the purpose of discharging the attributions provided under par. (2), the Romanian Development Agency may enter into consultancy agreements with natural or legal persons, as well as into collaboration agreements with natural persons.
(4) The Romanian Development Agency is also entitled to make a written request for information from public institutions involved, as well as from any central or local public institution, from independent shareholders’ registers, national corporations, national companies or other companies where the State is a shareholder, as well as from regies autonomous, which information is relevant and necessary to enable the Romanian Development Agency to fulfil its attributions under this article.
Art. 7 - (1) The public institution involved is in charge with the performance of the entire privatization process.
(2) For this purpose, the public institution involved:
A. exercises all rights attached to the shareholder status of the state or of the local public administration authorities, being able to empower its representatives in the General Meeting of Shareholders to take action for the implementation of the following:
a) the efficient administration of the national companies/corporations and of the companies whose shares are held in its portfolio, for the purpose of increasing the companies’ attractiveness, by taking measures for:
- preparing and implementing a multitude of organizational, technical, technological, managerial and financial operations designed to ensure the increase of the technical-economical achievements of the companies and diminishing budgetary or other type of debts;
- restructuring the companies through merger, division, sale of assets, or swap for shares of debts owed to commercial creditors, as well as through total or partial operational closure;
- requesting facilities for the payment of the budgetary obligations and negotiating the proposals which shall be submitted for approval in accordance with the law;
b) the voluntary liquidation of non-profitable companies.
B. takes all necessary measures for the completion of the privatization process of companies:
a) to determine the appropriate method for the privatization and to change it, if necessary;
b) to publish in the print media or electronic system, locally, nationally and/or world-wide, the lists of companies that are to be privatized;
c) to prepare the presentation file, the valuation report, the public offer prospectus, and any other documentation relevant to the privatization, in accordance with this emergency ordinance and the methodological norms issued in its application;
d) to effect the sale at market price of shares issued by the companies;
e) to initiate or, as the case may be, approve according to the law, the sale at market price of assets owned by companies or regies autonomous, except for those mandatory subject to the sale procedure in accordance with the provisions of this Emergency Ordinance;
(3) The litigations related to the contracts, agreements, protocols and any other acts or understandings executed by the public institutions involved in order to prepare, perform or finalize the privatization process with respect to companies or groups of companies fall under the jurisdiction of the commercial departments of the courts."
Art. 8 - (1) The State Ownership Fund is an institution of public interest, with legal personality, accountable to the Government, acting for the diminution of the state and local public administration authorities interest in the economy pursuant to sales of the shares they hold. The budget of the State Ownership Fund is entirely formed of the revenues resulted from the privatization of companies, from dividends and from interests related to its financial deposits, is approved by the Government and administrated in an extra-budgetary condition.
(2) The State Ownership Fund shall exercise the attributions provided under art. 43 par. (2) with respect to companies, other than the companies of strategic interest, in the case of which those attributions shall be exercised by the relevant ministries. The Government may decide that the State Ownership Fund exercise the attributions provided under art.43 par. (2) with respect to other companies as well. In the case of companies established pursuant to the Local Public Administration Law No. 69/1991, the attributions provided under art. 43 par. (2) shall be exercised by the local public administrative authorities.
Art. 9 - (1) The management of the State Ownership Fund is provided by a Board of Administration made up of president, vice-president and 9 members appointed by the Prime minister, trained and experienced professionals in the commercial, financial, legal or technical field, out of which one is the President of the Romanian Development Agency.
(2) The members of the Board of Administration can be revoked by the authority that appointed them.
(3) The Rules of organization and functioning of the State Ownership Fund shall be approved by Government Decision.
Art. 10 - The control of financial-accounting operations of the State Ownership Fund is provided by three auditors.
The auditors are appointed and revoked by the Prime-minister at the proposal of the Minister of Finances.
Art.11 The activity of the State Ownership Fund is based on the principle of decentralization. For this purpose, the small and medium-sized companies may be privatized at the level of the local branches and county territorial units of the State Ownership Fund.
Art. 12 - (1) The revenues collected by the public institutions involved from the sale of shares issued by the companies and from dividends shall be transferred to the state budget, or, as the case may be, to the local budgets, after deducting the expenses provided in their budgets and made in accordance with the provisions of this regulation. The budgets regarding the privatization activity of the relevant ministries shall be approved by the Government and administrated in extra-budgetary conditions.
(2) The expenditures shall include the following:
a) expenses for their own organization and operation, which in case of public institutions involved, other than the State Ownership Fund, are limited only to those incurred for privatization purposes;
b) expenses consisting of payments of the fees due to consultants, privatization agents or law firms, or related to the preparation and the carrying out of the privatization of the companies;
c) costs entailed by the operational closure, dissolution and liquidation of the companies;
d) actual expenses paid to buyers for obligations indemnified by the public institution involved or in defending against or satisfaction of any obligations, as well as compensations due according to art.31 par.(4) and art.35;
e) the amounts contributed by the public institutions involved to the share capital of certain companies, in the cases provided by the law.
(3) The expenses provided by letters a), b) and e) of the above paragraph are budgeted at 20% of the sales proceeds. If the amounts remaining at the involved public institution’s disposal are not enough for covering the expenses provided by par.(2), the Government may decide to raise the limit.
(4) Of the amounts paid to the state budget, according to par. (1) of the current article, a fund is set up at the Government’s disposal, for financing programs for the re-training and re-employment of the dismissed personnel, regional development, programs for development of small and medium sized companies, as well as other programs for development, as set up by the Government Decision.
(5) National companies or corporations which benefited from external loans undertaken by the state and granted by international institutions and which, upon the reimbursement of the installments of the principal, the interests or other currency costs, fail to fulfill their payment obligations according to the subsidiary loan agreements concluded with the Ministry of Finance, may request that such payments to be made from the revenues resulted from privatization, under the conditions set forth by Government decision.
(6) In case when the companies established through the decision of local public administrative authorities are privatized by the State Ownership Fund, the revenues collected from the sale of shares shall be transferred to the local budget, after deducting a 10% quota which shall remain at the State Ownership Fund’ disposal, in order to be covered the expenses related to privatization.
(7) The revenues collected by the public institutions involved, other than the State Ownership Fund, from the sale of the shares issued by the companies established through the public administration authorities’ decision, are transferred to the local budget after being deducted the expenditures provided by par.(2), according to par.(3).
(8) The public institutions involved cannot grant funds or loans to companies; neither can they buy shares issued by companies, or assets, except for the cases where the law provides otherwise.
(9) The public institutions involved are obligated to circulate the funds resulted from privatization operations through accounts opened with the state treasury.
Art. 13 – (1) The control of compliance of the public institution involved with the privatization legal framework, the establishment of the offences and application of the penalties shall be performed by the Ministry of Finance, under the conditions set forth in the methodological norms issued in the application of this Emergency Ordinance.
(2) The selection of the method of privatization, of the privatization agent and/or of the buyer, the operations provided under article 7 par.(2) A, as well as the legality of the clauses of the contracts concluded by the State Ownership Fund, including, without limitation, the clauses regarding the price of the sale, are not subject to the control of the Court of Account. The Court of Account shall only control the cashing and the utilization, according to the destinations provided by law, of the revenues due to the State Ownership Fund.
(3) The members of the Board of Administration and the employees of the State Ownership Fund are not liable for the operations of the State Ownership Fund, except for the case when the operations are considered as criminal or civil offences. The members of the Board of Administration and the employees of the State Ownership Fund shall not be liable for any action or inaction of the privatization agents.
(4) The provisions of par.(2) and (3) shall apply accordingly to all other public institutions involved."
Art. 14 - The State Ownership Fund concludes its activity when the Parliament ascertains the privatization process concluded, based on information provided by the Cabinet.
Chapter III
Sale of Shares
Section IArt. 15 - (1) The public institutions involved shall sell the shares through the following methods:
a) public offer;
b) methods of sale specific to the capital market;
c) negotiation;
d) open outcry or sealed bid auction;
e) depository receipts issued by investment banks on the international capital market;
f) any combination of methods provided by letters a) - e);
(2) In case that the public institution involved decides to issue an offer for sale, the offer price shall usually be equal to the nominal value of the shares, provided that the sale shall be made at the market price resulted from supply and demand, irrespective of the privatization method used, and no minimum selling price shall be used.
(3) For the purpose of determining the main terms of the shares sale, the public institution involved may order the preparation of a valuation report.
(4) The shares shall be sold at the market price resulted from supply and demand, even if such price is lower than the valuation price.
(5) The Ministry of Finances, on the name and on behalf of the state, may terminate, subject to the consent of the parties, via transferring the shares owned by the state to the holders of the state bounds, the obligations undertaken based on the external loan agreements which have been concluded. The way by which such operations may be performed shall be established in the methodological norms issued in the application of this emergency ordinance.
(6) The public institutions involved may receive, in exchange to the shares issued by companies, bonds or other instruments guaranteed by the state, under the conditions determined by the Government.
Art. 16 - (1) The sale shall be preceded by the publication of an announcement for sale or by the issuance of an irrevocable offer, valid at least 30 days, but no more than 180 days after it was made public. In case of the sale of stock of shares issued by banks or by large companies, the Government may order the extension of the offer’s validity term upon the proposal of the public institution involved.
(2) The public institutions involved shall ensure the publication of the announcement for sale and of the sale offer in a local and in a wide-spread national daily newspaper and/or on the Internet and, in appropriate circumstances, in an international journal, in accordance with the methodological norms which shall be prepared in the application of this emergency ordinance.
(3) The sale shall be preceded by the preparation of a presentation file in the cases specified in the methodological norms issued in the application of this emergency ordinance. In the case of companies listed on the stock exchange or other regulated national and international markets, the offer shall be drawn up based on a prospectus, in compliance with norms and regulations of the National Securities Commission or the appropriate authority, as the case may be. The presentation file shall contain also the industrial property rights.
(4) Upon request of the public institution involved or of the privatization agent, in order to have a determination of the budgetary obligations due by the companies subject to privatization, the Ministry of Finance shall authorize the territorial Department of Public Finance and State Financial Control in the jurisdiction of which the respective company’s headquarters is located to initiate the procedure of preparing a report on the nature and value of all the budgetary obligations.
(5) Based on this report, the Ministry of Finance shall issue a certificate of fiscal duties specifying the nature and value of all budgetary obligations as of the date of the report.
(6) The privatized company shall be exonerated by law from the payment of any other budgetary obligation, due as of the date of the report and not specified in the certificate of fiscal duties issued in accordance with par.(5).
(7) The terms and the stages of the procedure of preparing the report and of issuing the certificate of fiscal duties shall be regulated in the methodological norms issued in the application of this Emergency Ordinance.
(8) The provisions of par. (4) – (7) shall apply irrespective of the percentage of the capital of the company subject to privatization represented by the shares to be sold.
(9) Upon the request of the potential buyer, under the conditions set forth in the methodological norms issued in the application of this emergency ordinance, the public institution involved and the company subject to privatization are obliged to grant free access to all data and information regarding the activity and the assets and liabilities of the company which is privatized, for the purpose of enabling such buyer to prepare his own due diligence report. This will not prevent the public institution involved to negotiate and agree to indemnify the buyer for specific damages, including, without limitation, damages incurred by the buyer pursuant to a determination that the company has to perform any obligations, including any obligations to compensate third parties, or incurs any losses from acts, facts and deeds which have not been disclosed or the performance of which would entail costs exceeding the level provided in the sale-purchase agreement and the cause of which existed by the time the agreement was executed. Notwithstanding the above, the overall amount of all indemnities to be granted by the public institution involved shall not exceed the purchase price paid by the buyer. The State shall guarantee any payment obligation of the public institution involved.
(10) During the period the company is undergoing privatization process, the administrators of the company are obliged to notify immediately to the public institution involved the occurrence of any act or fact that results in changes of the data contained in the presentation file or creates liabilities for the company.
Art. 17 - The public institutions involved are entitled to conclude a contract with Romanian and foreign legal entities or individuals, for professional assistance services in the field of privatization, restructuring and liquidation. The public institutions involved can also conclude contracts with broker/dealer companies for the sale of shares on the stock exchange or other regulated national or international markets, as well as with investment banks for the transfer or sale of a portfolio of shares on the international capital market based on the depository receipts or other financial tools used on the respective market.
Art. 18 –(1) In order to enhance the privatization chances of companies, the public institutions involved can accept the payment in installments of the shares’ price, in accordance with the conditions set forth in the methodological norms issued in the application of this emergency ordinance.
(2) In the case that the shares of companies of strategic interest are sold with the payment in installments, the down payment shall be equal to at least 35% of the sale price while the payment of the installments shall be rescheduled for a period of maximum 3 years.
(3) There shall be constituted a pledge on the shares for which the purchase price is paid in installments.
(4) In case the buyer does not pay on due term two successive installments, the share-purchase agreement may be terminated.
Art. 19 - (1) In order to fulfil the attribution provided under art.7 par. (2) A lett. a), the public institution involved submits to with each budgetary creditor a request regarding the grant of facilities such as exemptions, reductions, postponements or rescheduling for the payment of budgetary obligations owed by the companies subject to privatization to the budget administered by the respective budgetary creditor.
(2) Each budgetary creditor is obliged to conduct negotiations with the public institution involved with respect to the possibility of granting the requested facilities. In case the granting of such facilities does not fall under the competence of the budgetary creditor, the latter has to submit to the Government the result of the negotiation within 30 days from the date such request was registered and to notify the public institution involved with regard to the fulfillment of such obligation.
(3) The public institution involved shall be vested by law with the power to submit to the Government approval the result of the negotiations if the budgetary creditor fails to observe the term specified under par. (2) for the completion of this obligation.
(4) The Government shall decide with respect to granting the requested facilities within 20 days from the receipt of the result of the negotiations.
Section II
Art. 20 - (1) To obtain the ownership right for shares issued by a company where the state or an authority of the public local administration is a shareholder, the staff, the members of the Board of Administration or the pensioners who worked for the company before they retired can establish associations in compliance with the provisions of the current section.
(2) The association is a non-profit legal entity of private law, including entities mentioned in the previous paragraph, with the purpose of obtaining shares issued by commercial companies.
(3) Within a company one or several associations can be established, including: a) employees of the respective company and/or pensioners who worked for the company before they retired; b) members of the Board of Administration and employees.
Art. 21 – (1) The members of an association can be, as the case may be: a) staff of the company, having a work contract for an unlimited period of time; b) staff of the company, having a work contract for a limited period of time, with a regular work schedule (at least half time).
(2) The entities mentioned in art. 20 par. (1) could be included in only one association.
Art. 22 - The procedure of establishment and liquidation of a company, the structure of an association, rights and liabilities of the members are stipulated in Law 21/1924 and the relations between an association and the company within which the association is established, are regulated by the governmental decision.
Art. 23 - (1) An association may acquire ordinary or preferred shares issued by one of the companies mentioned in art. 2.
2) The sale shall be made at the market price, based on demand and supply, through one of the methods provided in art.13 par. (1) let. c) and d).
Art. 24 - (1) Shares purchased in compliance with the provisions of this section are registered in the Registry of shareholders and shall be registered in the Register of Commerce under the category "shareholders", until full payment of the price, benefiting from voting right in the Shareholders General Meeting, according to the type of shares purchased: ordinary or preference shares.
(2) Shares purchased in compliance with the provisions of the current section are transferred to the members of the association only after entire payment of the price.
Art. 25 - The association is wound up in one of the following cases:
1. when the objective of establishment is reached, all debts are paid, and the shares distributed to the members of the association;
2. when the number of employees goes beyond 20. In this particular case, the Shareholders General Meeting could decide the winding up of the company, only after setting up with the State Ownership Fund as well as with the other creditors, the ways to pay the debts, as the case may be.
Chapter IV
The sale of the assets of the companies and of the regies autonomousSection I
Sale of assets, with entire paymentArt. 26 - (1) The companies where the state or a local public administrative authority is a majority shareholder may sell assets they own or enter into leasing agreements in respect thereof, with the approval of the General Meeting of Shareholders or the Board of Administration, as the case may be, under the conditions set forth in the methodological norms issued in the application of this Emergency Ordinance.
(2) The provisions of par. (1) shall also apply to regies autonomous, with the approval of the relevant ministry or the local public administrative authority, as appropriate.
(3) The sale of assets shall be done via open outcry auction, with adjudication for the highest price obtained on the market.
(4) The provision of art. 16 par. (9) shall apply accordingly to the companies which are selling the assets.
(5) The provisions of this article are also applicable in the case of conclusion of a leasing contract with irrevocable sale clause having as object the use of the assets owned by companies where the state or an authority of a public local administration is a majority shareholder, if it is not stipulated otherwise in the leasing contract.
Art. 27 - (1) The representatives of the public institutions involved in the general meeting of shareholders, the members of the Board of Administration and the Executive Managers of the selling companies or regies autonomous cannot take part in the sale of assets pursuant to art. 26.
(2) The amounts resulting from the sale of assets pursuant to art. 26 shall be used according to the following ranking for:
a) payment of debts towards the state budget and the local budgets, including payment of debts resulting from payments made by the Ministry of Finance on the basis of guarantees executed for internal and external loans, as well as from sub-loans extended from external loans contracted directly by the state;
b) payment of debts towards the social insurance budget and the budgets of special funds;
c) payment of other debts;
d) making investments;
e) financing activities included in the "Object of Activity";
f) incurring expenses referring to fulfillment of legal obligations in compliance with environmental protection requirements, as the case may be;
g) other destinations.
(3) The sale of assets and use of proceeds from the sale of assets shall be subject to any contractual rights of creditors holding a mortgage, pledge or other security interest in or over the assets to be sold.
(4) The amounts mentioned in par. (2) cannot be used for the payment of salary rights of the company’s personnel, except for the cases provided by international treaties to which Romania is a party.
Art. 28 - (1) The companies and the regies autonomous, which are parties to ongoing leasing, rental or partnership contracts, could sell or conclude leasing contracts for fixed assets with an irrevocable sale clause, through direct negotiation with the lessees or partners, in case that such lessees or partners invested in assets they already make use of more than 15% of the value of such assets. In such case, the value of investments determined based on a valuation report accepted by both parties, is deducted from the sales price.
(2) The sale shall take place with the approval of the public institution involved.
Section II
Art. 29 - The regie autonomous and the companies where the state or a local public administrative authority is a majority shareholder, with the approval of the public institution involved, may sell assets in installments to business entities – individuals, family partnerships authorized under the Decree-Law No.54/1990 as amended, or companies formed under Law No. 31/1990, as subsequently amended, which are included in the category of small and medium companies, according to the law.
Chapter V
Environmental Obligations and Protection of EmployeesArt.30 - (1) In case that, as a result of the transfer of the ownership right over the share-stock, the buyer would acquire control over the company, the company has to prepare, in accordance with the provisions of the methodological norms issued in the application of this emergency ordinance, an environmental report, which shall be submitted for endorsement by the competent environmental authority. The endorsement shall specify the environmental obligations incumbent upon the company.
(2) The competent environmental authority is obliged to issue and communicate the endorsement within 15 days from the receipt of the environmental report. In case of failure to communicate the endorsement in the set time limit, the company shall be deemed as carrying out its activity in full compliance with the legal requirements in force regarding the environment protection.
(3) Based on the environmental report endorsed pursuant par. (2), the public institution involved has the obligation to include in the presentation file or in the public offer prospectus, as applicable, the environmental obligations which have to be fulfilled by the company.
(4) The public institutions involved must compensate the buyer, within the limits of the purchase price paid, or the company, as appropriate, for the damages incurred pursuant to a determination that the company has to fulfill certain obligations of compliance with the norms regarding environmental protection or has certain liabilities caused by environmental pollution due to past activities, which have not been disclosed in the presentation file or in the public offer prospectus. The state shall guarantees the payment by the public institutions involved of the compensations mentioned.
(5) The provisions of par. (1) - (3) shall apply accordingly in the case of sale of assets, any time such assets are part of the patrimony of a company or of a regie autonomous which performs an activity qualified, according to the law, as having a negative impact on the environment.
(6) In all cases, the company is obligated to compensate the buyer for the damages incurred pursuant to a determination that the buyer has to fulfill certain obligations of compliance with the norms regarding environmental protection which have not been disclosed in the presentation file of the asset.
Art.31 – (1) The employees of the companies whose shares are subject to an ownership transfer benefit from the social protection measures provided by the Government Ordinance No. 48/1997, approved by the Law No. 51/1998.
(2) In the case of the companies undergoing privatization and which apply restructuring measures which lead to collective dismissals, as agreed upon the sale of shares, the compensation rights due under the applicable laws to dismissed employees shall be paid from the Fund for the payment of unemployment benefits, within the limits and in the conditions established by the law.
(3) The employees of the companies in which the companies undergoing privatization holds at least a 50% ownership interest, benefit also from the protection measures provided under par.(2).
(4) The personnel dismissed from the private companies upon the date of this regulation and which applies restructuring measures approved through the General Meeting of the Shareholders’ decisions, benefit from the compensatory payments from the Fund for the payment of unemployment benefits, under the conditions set forth in art.2, 19-22 of the Emergency Ordinance No. 9/1997, as amended by the Emergency Ordinance No. 52/1998.
(5) The provisions of par. (2) shall apply also to the companies in the case of which the public institutions involved sell at least 1/3 of the total number of shares on the organized capital markets, provided that the offer prospectus contains information regarding personnel dismissals.
(6) The dismissed employees will be included in re-training and re-employment schemes, financed from the fund established at the disposal of the Government for this purpose, according to art. 12 par. (4).
Chapter VI
Real Estate Properties Held by Companies Subjected to PrivatizationArt. 32 - (1) The companies holding land that is necessary for the performance of their activity according to their objects of activity and whose legal regime is yet to be clarified shall continue to use such land until the clarification of the legal regime of the land.
(2) The companies shall be privatized without including in the share capital the value of the land provided in par.
(3) When a final decision regarding its legal status is reached, the land classified as belonging to the public property of the state or of the territorial administrative units, as the case may be, remains in the use of the privatized companies or of the companies to be privatized, on the basis of a concession granted by the competent authority, for the maximum period provided by the law. By derogation from Law No. 219/1998 regarding the concession’s regime, the method, the procedure and the documentation necessary for the conclusion of the concession shall be provided by the methodological norms issued in the application of this Emergency Ordinance. The land classified as belonging to the private property of the state or of the territorial administrative units, as the case may be, may be concessionaired in the above mentioned conditions, leased or offered for sale to the company.
(4) The general criteria for determining the royalty, rent and selling price shall be regulated in the methodological norms issued in the application of this Emergency Ordinance.
Art. 33 - (1) The social capital of the companies that have received certificates attesting the ownership right over the land shall be increased by law with the value of the land specified in the certificate.
(2) The administrators are obligated to register the increase of the social capital with the Trade Registry within 60 days from the issuance of the certificate, the company being exempted from the payment of any fees or charges related to such registration.
(3) In case that the issuance of the certificate attesting the ownership right over the land has not been followed by an appropriate increase of the share capital, prior to privatization, or when such certificate is issued after privatization, the share capital shall be increased by law with the equivalent value of the land, which shall be deemed as contribution in kind of the state or of the territorial administrative units, as the case may be, in consideration for which additional shares will be issued, which shall be distributed by law to the public institution involved. The buyer has a call option to purchase from the public institution involved, for a price agreed for this purpose in the original share purchase agreement, or, absent such clause, for the price paid by the buyer for the initial stock, up-dated in accordance with the provisions of the methodological norms issued for the application of this Emergency Ordinance, a number of additional shares representing a percentage of the newly issued shares equal to the buyer’s participation quota in the share capital by the time the certificate has been issued or by the time the initial stock has been acquired, as the case may be. The buyer can exercise this option within 2 months from the registration of the increase of the capital. The transfer of the ownership right over the newly issued shares shall occur upon the full payment of the shares.
(4) Prior to the end of the call option term, the voting rights attached to the shares issued in accordance with par.(3) shall be suspended.
(5) The General Meeting of the Shareholders deciding the issuance of the additional shares representing the equivalent value of the land may decide the automatic conversion of such shares into preferred shares, bearing no voting right but priority dividends, on the date on which the call option term expires or, as the case may be, on the date of the termination of the shares sale purchase agreement.
Art. 34 - Any other shareholder, who is not a party to a shares sale-purchase agreement providing otherwise, shall be entitled to exercise the call option provided by art. 33 par. (2) under the same terms and for a consideration equal to the one paid by the buyer.
Art. 35 - (1) The public institutions involved shall ensure the compensation of the damages caused to privatized or undergoing privatization companies where such damages are sustained as a result of an adjudication of restitution to former owners of real estate properties previously turned into state property.
(2) The public institutions involved shall pay to the companies provided by par. (1) a compensation representing the equivalent value of the real estate properties held by the company to former owners pursuant to a final judgement.
(3) The compensation provided in par. (2) shall be agreed upon with the companies or by the courts if such an agreement cannot be reached.
(4) The real estate properties which have been turned into state properties based on laws, administrative acts or court seizure decisions, consisting of lands and buildings evidenced in the patrimony of companies privatized or undergoing privatization, and the absence of which would materially hinder the achievement of their object of activity such that, as a result of such restitution, the companies shall no longer be able to perform their activity and shall be subject to dissolution and liquidation, shall not be restituted in kind.
(5) In case that by final judgement the companies are bound to pay the equivalent value of the real estate properties, the public institutions involved shall directly pay such amount to the former owner.
(6) The state shall guaranty the fulfillment by the public institutions of the obligations provided in this article.
CHAPTER VII
Special Procedural Provisions Related to Operational Closure and Sale of Non -Profitable Assets, Merger, Spin-off, Dissolution and Liquidation of Companies Subject to Privatization
Section I
The Operational Closure and the Sale of the Non-Profitable AssetsArt. 36 – There shall be subject to operational closure all the assets for which from the process of exploitation and capitalization of the products and services they realize there cannot be recovered at least the costs related therewith, except for those whose exploitation cannot be terminated due to legal reasons or for the assets integrated in a complex technological process, provided that the entire exploitation is profitable. For this purpose it is forbidden to compensate the loss incurred by a sector of the activity of the company with the incomes obtained by another sector. It is not deemed compensation the quota with which the sector incurring the loss has participated in obtaining this income.
Art. 37 – (1) The assets which have been operationally closed shall be subject to a mandatory sale procedure and the employees shall be dismissed and shall receive the compensation rights due under the applicable law.
(2) The Board of Administration is obligated to publish the sale announcement and the date scheduled for the sale of the asset by auction within maximum 60 days from the date on which the decision regarding the operational closure has been passed, subject to the possibility of having their liability entailed for the damages caused to the company by their inaction.
Art. 38 – (1) The sale of the asset is made by public outcry auction, pursuant to the provisions of the methodological norms issued in the application of this Emergency Ordinance.
(2) If the asset cannot be sold, it will be dismembered and/or cased off.
(3) The amounts resulted from the sale of an asset pursuant to public auction or from its turning into good account pursuant to its dismemberment and/or quashing shall be used in accordance with art.27 par.(2) and (3).
Section II
General Provisions regarding Mergers, Spin-offs, Dissolution and LiquidationsArt. 39 – For the purpose of accelerating the process of privatizing the companies where the state or a local public administrative authority holds at least 51% of the social capital, the merger, spin-off, voluntary dissolution and liquidation, are subject to the procedural provisions provided for in this chapter.
Art. 40 – (1) The representatives of the public institutions involved in the General Meeting of Shareholders of the companies mentioned in art. 39 shall request to the Board of Administration to prepare and submit to the General Meeting of the Shareholders an appraisal of the possibilities and of the economic consequences of a merger, spin-off or dissolution and liquidation of the respective company, as well as the draft decision for merger, spin-off or dissolution.
(2) The Board of Administration shall convene the General Meeting of the Shareholders which shall take place within maximum 60 days from the date of the request provided by par.(1) above, in order to decide with respect to the merger or the spin-off or within maximum 30 days calculated from the same date, in order to decide with respect to the dissolution and liquidation, and to approve, in each particular case, the draft of the necessary addenda or constitutive acts.
(3) The convocation shall be published in a wide-spread national daily newspaper and in a newspaper widely-spread in the town where the company’s headquarters is located, at least 15 days prior to the meeting.
(4) In case that on the agenda is indicated the dissolution and the liquidation of the company, the Board of Administration is obligated to prepare and put at the shareholders’ disposal, at the company’s headquarters, at least 3 days before the meeting, the detailed presentation of all the debts of the company, indicating the creditors and the date on which their account receivables became or will become mature.
(5) The validity of the decisions of the General Meeting of the Shareholders requires a quorum of at least half of the social capital and the absolute majority of the votes.
(6) The decision of the General Meeting of the Shareholders shall be submitted with the Trade Registry and shall be published, in a wide-spread national daily newspaper and, if appropriate, in an international daily newspaper, as well as on the Internet, within 2 days from the date of its approval.
Art. 41 – (1) The companies provided in art.39 shall be dissolved by law in case they have outstanding debts which have not been paid within 60 days from their maturity – except for salaries - and which, cumulated, exceed 50% of their assets.
(2) By exception from the provisions of the previous paragraph, prior to January 1, 2000, the provisions of this article shall apply only to companies having outstanding debts which have not been paid within 60 days from their maturity - except for salaries – and which, cumulated, exceed 120% of their assets and between January 1 – August 1, 2000, only to companies in the case of which the debts mentioned above exceed 85% of their assets.
(3) Within 10 days from the date of the coming into force of this Emergency Ordinance, respectively, from January 1, 2000 or August 1, 2000, according to the differences described in par.(2), the representatives of the public institutions involved in the General Meeting of the Shareholders shall request the censor’s committee to prepare and submit to the Board of Administration, within 30 days, a report regarding the situation of the overdue debts of the company.
(4) Within 20 from the receipt of the censors’ committee report, the Board of Administration shall convene the General Meeting of the Shareholders in order to ascertain the company’s dissolution by law and the commencement of the liquidation procedure. The provisions of art. 40 par.(3) – (6) shall apply accordingly.
(5) In the case of companies of strategic interest or of those which are in an advanced process of privatization, upon the proposal of the public institution involved, the Government may decide the continuation of the activity of the company until a further date.
Art. 42 – Within 30 days from the date the General Meeting of the Shareholders approved the merger, spin-off or the voluntary dissolution or acknowledged the by law dissolution of the company, the Board of Administration shall finalize the required documents. The decision of the Board of Administration issued for this purpose shall also mention the period provided by art.60 within which the minority shareholders and/or the creditors may formulate an annulment request or an opposition, as the case may be.
Art. 43 - (1) The decision of the Board of Administration provided in art. 42 and the addenda or the constitutive acts, as appropriate, executed by the President of the Board, shall be filed with the Trade Registry together with all the other documents necessary for the registration at the same time of the mentions regarding the merger or the split-off, respectively, of the mention regarding the dissolution of the company.
(2) The decision mentioned in par. (1) shall be published in accordance with art. 40 par.(6) which shall apply accordingly.
Section III
The Liquidation
Art. 44 – (1) Within 5 days from the publication of the dissolution and liquidation decision provided by art. 40 par. (6) or, as the case may be, by art. 41 par. (4), the Board of Administration must notify the creditors the company is aware of, by quick mail delivery with receipt confirmation, and must publish two consecutive announcements in a wide-spread national daily newspaper and, if appropriate, in an international daily newspaper, as well as on the INTERNET. The notification and the announcements shall specify the total value of the company’s debts, as they are registered in its accounting records, the account receivables which are compensated in full or in part with the debts the creditors owe to the company, the order of preference of the account receivables determined in accordance with art.52 par.(1), as well as the deadline until which the creditors can express their intention to turn into account their account receivables according to the provisions of this Chapter, by submitting a statement of debts, even prior to the debts maturity. Such term cannot be shorter than 15 days and cannot exceed 20 days from the date of the publication of the last announcement.
(2) - The creditors who submit statements of debts form the association of creditors, where decisions are taken with absolute majority of the votes. The vote of each creditor is proportional with the size of its account receivable in the total value of the account receivables of the associated creditors. The association of creditors is not a legal person. The organization and operation of the association of creditors shall be regulated by the Methodological Norms issued for the application of this Emergency Ordinance.
(3) – The right to contest the existence or the amount of a debt or its rank in the order of preference ceases after the elapse of 20 days since the publication of the last announcement.
Art. 45 – (1) The provisions of this section shall apply also to the companies provided by art.20 of Law No. 64/95 Regarding Judicial Reorganization and Bankruptcy, save for the case when the court admits in principle the company’s liquidation and the company’s assets distribution under the conditions set forth in the Law No. 64/1995, upon the request of the creditors holding, separately or jointly, the account receivables representing at least 51% of the company’s total debts as registered in the company’s financial-accounting records and who have submitted statements of debts. The request has to be filed within 20 days from the date of the publication of the last announcement provided in art. 44 par. (1), subject to loose up the right to formulate such request thereafter. In such cases, the provisions regarding the reorganization of the companies are not applicable.
(2) On the day following the end of the period of time provided by the previous paragraph, the company subject to liquidation shall file with the court within the jurisdiction of which it is located an up-dated presentation of all the debts registered in its financial-accounting records, irrespective of their maturity date, as well as a centralized presentation of all the statements of debts submitted in accordance with the provisions of art.44 par.(1).
(3) Within 15 days from the end of the period provided by par.(1), the president of the court or, as the case may be, the judge designated for such purpose, shall decide in the council room, without summoning the parties, whether the requests of the creditors are admissible in principle. The decision has to specify in all cases the reasons on which it has been grounded and may be challenged only by recourse within 5 days from the date on which it was notified to the parties.
Art. 46 – (1) No interest, penalty, incremental default interest or similar expense shall be added to the unsecured claims or to the unsecured parts of the secured claims after the date when the dissolution decision is filed with the Trade Registry.
(2) On the same date, there shall be suspended the hearing of all court or out of the court claims against the company, the prescription terms relating to actions for the realization of company’s creditors’ account receivables, as well as any enforcement proceeding started against the company which shall be resumed in case the General Meeting of the Shareholders reverses the liquidation decision. The General Meeting of the Shareholders shall be prevented to reverse the liquidation measure if it has decided the full operational closure of the company or if the company was dissolved by law pursuant to art. 41.
Art. 47 – (1) The liquidator shall be appointed by the public institution involved pursuant to a tender within 60 days from the date of the filing of the dissolution decision with the Trade Registry.
(2) The privatization agent exercising the attributions set forth in art.7 par.(2) with respect to the company undergoing liquidation may act as liquidator based on the mandate granted to it or on a request submitted to the public institution involved without being necessary the organization of a tender.
(3) The liquidation contract shall be executed and shall enter into force within 2 days from the selection of the winner, under the sanction of voidness.
(4) The liquidator shall take over its function after having submitted its signature with the Trade Registry and the signature specimen with the bank, on the date following the day of the execution of the liquidation contract.
(5) Within 30 days from the date the liquidator takes over its function there shall take place the delivery-receipt of the company’s patrimony and documents, in accordance with the art.247 par. (4) of Law No.31/1990 regarding the commercial companies, such operation having to be certified by the censors. On the date of the fulfillment of such formality the mandates of the administrators cease.
(6) In case the request submitted by the creditors based on the art. 45 par.(1) was approved in principle, the appointment of the liquidator pursuant to this article shall be subject to validation by the syndic-judge.
Art. 48 – Within maximum 15 days from the date of taking over its function, the liquidator has the obligation to prepare the debts table which shall be deposited at the company’s headquarters in order to be analyzed by the creditors.
Art. 49 – (1) In case there occurs an event determining the termination of the liquidation contract, the liquidator or, as the case may be, its successor in rights, is obligated to immediately notify the public institution involved with regard to such situation, save for the case when the latter notified to it the cause of the termination of the contract.
(2) In the case of the companies dissolved by law according to the provisions set forth in art. 41 the public institution involved may request the termination of the liquidation contract based also upon the well justified request of the creditors’ association.
(3) In the case the liquidation contract is terminated, the public institution involved shall proceed either to the appointment as liquidator of the second ranked within the tender organized according to art. 47, or to the appointment of a special trustee to administer the company’s patrimony until the appointment of a new liquidator according to the provisions of art. 47, but not longer than 60 days from the cessation of the function of the liquidator whose mandate was, terminated.
(4) The provisions of art. 47 par. (4), (5) and (6) shall apply accordingly to the situations provided in par. (3) above.
(5) The liquidator whose contract was terminated, until handing over the patrimony to the special trustee or to the new liquidator, or the special trustee for the duration of exercising its function, shall not be allowed to carry out any liquidation act or operation over the company’s patrimony, except for the preservation and administration acts.
Art. 50 – (1) The sale of the goods shall be made on the basis of an open outcry auction, as provided by the Methodological Norms issued in the application of this regulation.
(2) The goods shall be adjudicated at the highest price offered.
(3) Subject to its voidness, the contract for the sale of the adjudicated good has to be concluded within 5 days from the date of the auction. The liquidator may extend such term by maximum 5 days.
(4) The contract may provide for the payment of the price in installments, provided that the payment of the installments is secured in accordance with the conditions provided in the methodological norms issued in the application of this regulation.
(5) The provision of art. 38 par. (2) shall apply accordingly.
Art. 51 - (1) The creditors, except for the shareholders, may bid on their claims for the goods that are auctioned, according to the provisions set forth in the Methodological Norms issued in the application of this regulation.
(2) The goods or assets subject to a privilege, pledge or mortgage may be adjudicated only in lieu of payment of the privileged claim or of the claim secured by pledge or mortgage, unless the creditor having preferred and uncontested rank waives in writing his right.
(3) The adjudication of goods in the account of the creditors’ claims cannot lead to a non-compliance with the order of preference set forth in this regulation.
Art. 52 – (1) In order to cover the company’s debts, the liquidator shall effect payments to the creditors, irrespective whether the debts owed to them have reached or not the maturity date, from the sums collected from selling movable and immovable assets of the company and from recovering certain accounts receivables against third parties, observing the following order of preference:
a) covering expenses related to sales or to the carrying out of the liquidation procedure;
b) paying salaries;
c) paying the creditors in whose favor the company has constituted a pledge or mortgage over its movable or immovable goods, from the sums obtained from the sale of such goods; these provisions shall apply also to the debts guaranteed by special privileges;
d) paying the state debts or the local public administration debts representing taxes, fees and other fiscal obligations determined according to the law, contributions to the social insurance budget, as well as to special funds;
e) paying state debts resulting from the payments made by the Ministry of Finances on the account of the guarantees related to executed internal or external loans, as well as for external loans directly undertaken by the state, from which have been made sub-loans;
f) paying debts resulting from loans granted by the state, including those extended for the payment of natural gas and electric power, according to the regulations in force at the time when the loan was granted;
g) paying the unsecured creditors;
h) paying the shareholders.
(2) The account receivables resulting from the sales of assets in installments and the guarantees that accompany them may be transferred to the creditors in lieu of payment of the amounts owed to them; the creditors will notify the buyer and the guarantor the assignment of the contract and of the guarantee.
(3) The distribution toward the creditors mentioned at let. a)-g) of the amounts resulted from the sales shall be made every 3 months, while the distribution toward the creditors mentioned at lett. h) shall be made only after the reimbursement in full of all other debts.
(4) No distribution of amounts toward creditors can be made prior to the date a final judgement is issued with respect to the requests submitted according to the art. 44 par.(3) or prior to the resolution of the recourse provided in art. 45 par.(3).
Art. 53 - The liquidator is empowered to effect only the expenses and to dismiss personnel within the limits necessary for the functioning of the company and to monitor the resolution of the company’s account receivables against third parties. The possible amounts existing at the end of the liquidation period, which do not result from the sale of goods through auctions, shall be distributed in the order provided for the sums resulted from auctions.
Art. 54 – (1) The creditors may create fiscal deductible provisions for covering the losses resulted from the total or partial failure in recovering their account receivables from the amounts distributed as a result of the liquidation procedure. The diminution or annulment of such provisions shall be effected based on certificates issued by the liquidator, upon the closure of the liquidation procedure, to the creditors whose claims have not been entirely covered, specifying the balance of the uncovered claim.
(2) The creditors whose claims were submitted after the expiration of the deadline for the submission of debts statements, but not later than the closure of the liquidation procedure, shall take part proportionally only in the distribution of the amounts which potentially remain after covering the claims registered in due time. In this case, the provisions of par.(1) are not applicable.
Art. 55 – (1) After distributing the amounts resulting from the turning into account of all of the company’s assets, the creditors whose claims have not been entirely covered, the liquidator or the territorial Chamber of Commerce and Industry may request the competent court to rule the annulment of certain legal acts of the company or the personal responsibility of the company’s management bodies.
(2) The creditors mentioned in art. 54 shall benefit from the results of such actions.
Art. 56 - (1) Within 20 days from the last auction, the censors shall prepare a report regarding the entire liquidation procedures and shall submit it for the approval of the public institution involved. The liquidator is discharged as effect of the approval of the report.
(2) – After the approval, the liquidator shall ensure the submission of the report at the company’s headquarters for the information of the shareholders and, within 15 days after such submission, the registration of the report ,with the Trade Registry. On the registration date the company shall be wiped out by law without any other formality.
Art. 57 – The papers and the registers of the company, its stamp and documents shall be handed over by the liquidator to the public institution involved, which may continue, on its own behalf and in its own interest, the recovery against third parties of the company’s claims which have not been resolved by the date of the liquidation.
Art. 58 – On the date the company is wiped out from the Trade Registry there shall cease by law any legal action against the company.
CHAPTER VIII
Resolution of the LitigationArt. 59 –The right to legal action by which an operation or an act provided for in this regulation is challenged, or a right conferred therewith is enforced, shall be time-barred in 3 months from the date when the plaintiff knew or should have known the existence of the challenged operation or act or from the date when the right commenced to exist.
Art. 60 - The annulment requests and oppositions against the decisions provided in art. 40 can be filed with the competent court within 10 days from the date of the publication of the decision of the Board of Administration grounded thereon. In the case of the decisions provided under art. 41, the period for the filing of annulment requests and oppositions shall commence on the date of their publication in accordance with art. 40 par.(6).
Art. 61 – (1) The annulment request and the opposition do not suspend the enforcement of the challenged decision. Upon request, for well justified reasons, the court may decide the suspension of the enforcement of such decisions provided that a guarantee of 1% of the value of the social capital of the company subject to merger, spin-off or liquidation, or, as the case may be, a guarantee of 1/4 of the debt, but not more than ROL 200,000,000 is deposited with the court. The guarantee shall be reimbursed only in case the claim is received. The maximum amount of the guarantee may be updated periodically by Government Decision.
(2) The provisions set forth in par.(1) shall also apply to the requests provided in art. 41 par.(3). In such case, the guarantee shall amount to 1/4 of the contested debt, but not more than the maximum amount provided by par.(1).
Art. 62 – (1) The requests provided in art. 44 par. (3), art.59 and art. 60 fall under the jurisdiction of the court of appeal and shall be solved urgently and with priority.
(2) If the court considers that there are well justified reasons for which the parties could not present their defenses in a complete manner, it can grant, as an exception, a delay of maximum 7 days, for which the parties shall not be summoned.
(3) The court is obligated to pass its decision within 5 days from the closure of the debates and to communicate to the parties the written legal grounds of its decision within maximum 10 days from the date when such decision was passed.
(4) The court’s decision can be challenged only by recourse.
Art. 63 (1) The following actions are considered as violations of the norms of this emergency ordinance, unless they are not criminal offences, according to the criminal law:
a) failure to observe the publicity rules for the sale of shares and assets;
b) failure to prepare the environmental report within the term provided by the law;
c) not including particular assets of a company in the sales offer and the valuation report, or including fictitious assets in the sales offer or the valuation report with the obvious purpose to influence the offered price;
d) failure to register the increase in the social capital within the dead line provided by the law
e) assigning a package of shares to a person, damaging other persons that submitted a more profitable bid, according to the criteria set in the sales offer;
f) disclosing confidential information to third parties regarding the intent of selling a stock portfolio, with the purpose of influencing the offered price or to favor a potential buyer and damaging other persons.
g) failure to observe the terms and the procedure for the preparation and issuance of the certificate of fiscal duties;
h) failure to notify the acts and facts provided in art. 16 par.(10);
i) failure to observe the deadline provided by art.37 par.(2) for the publication of the announcement regarding the sale of the non-performing assets;
j) failure to convene the General Meeting of the Shareholders within the dead line provided by art.40 par.(2) or art.41 par.(4);
k) failure to observe the dead line provided by art.41 par.(3) for the submission of the request regarding the preparation of the censors’ committee report or of the deadline provided by art.40 par.(4), art.41 par.(3) or art.45 par.(2) for the submission of the presentation of the company’s debts;
l) failure to publish the decisions of the General Meeting of the Shareholders or of the Board of Administration in accordance with the provisions of art. 40 par.(6), art.41 par.(4) or art.43;
m) failure to observe the timeframe provided by art.42 for the finalization of the documents necessary for the merger, spin-off or dissolution;
n) failure to observe the period of time provided for the appointment of the liquidator;
o) failure to observe the dead line for the notification of the creditors and the publication of the announcements in accordance with art.44 par.(1);
p) failure of the liquidator or, as the case may be, of the trustee to observe the deadlines provided by art.47 par.(4) and (5) and by art.48.
(2) The violations provided in par.(1) are penalized as follows:
- for penalties provided under lett. a), the fine ranges from ROL 5,000,000 to ROL 10,000,000;
- for penalties provided under lett. B)-f), the fine ranges from ROL 10,000,0 to ROL 20,000,000;
- for penalties mentioned in letters g)-p), the fine ranges from ROL 50,000,000 to ROL 100,000,000;
(3) For the circumstances mentioned in par. (1), penalties will be individually applied to the staff of the public institution involved staff, valuators, or to the personnel of the competent environment authority, of the relevant ministries, of the Ministry of Finance or of the competent Department for Public Finances and State Financial Control, to the administrators, auditors, trustees or liquidators of the companies.
(4) In the case of brokerage houses and privatization agents, the fine shall range from ROL 1,000,000,000 to ROL 2,000,000,000.
(5) The establishment of offences and application of the penalties provided under par. (1) a)-e) and h) – p) shall be effected by the Ministry of Finance jointly with the staff of the competent environment authority, in case the environmental account has not been drawn up, or, as the case may be, by the National Securities Commission, for the offence provided under par. (1) letter f) or by Control Department of the Government, for the offence provided under par.(1) letter g).
(6) Fines mentioned in par. (2) are to be periodically adjusted by Government Decision.
(7) The offences provided under this chapter shall be governed by the provisions of Law No. 32/1968 on the assertion and sanctioning of offences, as subsequently amended, except for art. 25, 26 and 27."
Chapter IX
Special Rules Concerning Certain CompaniesArt. 64 - (1) In the case of the privatization of companies resulting from the reorganization of the regies autonomous and of other companies of strategic interest, the Government shall have the option to retain a golden share, determining also the entity which shall exercise the rights deriving from such quality.
(2) The Golden Share grants the following rights to the State: a) appointing 1-2 representatives in the Board of Administration; b) possibility to disagree, in the Shareholders General Meeting or the Board of Administration, with decisions concerning pledging or mortgaging assets, winding up or liquidation in compliance with the provisions of Company Law No. 31/1990, as subsequently adjusted, change of the object of activity, as well as merger through take-over, in case the decisions could influence consumer protection, the activity of the company by favoring a third party, protection of competition or in the case of damaging national interests.
(3) The Golden Share can be shifted into an ordinary share by governmental decision.
Art. 65 – (1) Privatization of banks shall be as provided for in Law No. 83/1997 regarding the privatization of banking companies in which the state is a shareholder. The sale of shares issued by banks where the State is a shareholder shall be effected according to any of the methods provided in this regulation.
2) Privatization of companies in the tourism field shall follow the provisions of the Government Emergency Ordinance
No. 32/1998 regarding the privatization of the companies in the tourism field.
Chapter X
The Privatization AgentsArt. 66 - (1) In order to accelerate the privatization process, the public institutions involved may delegate to privatization agents the exercise of certain rights and powers, including any or all of the attributions specified in art. 7 par. ( 2 ) herein, except the conclusion of the contract for sale of shares. Upon the request of the mandatory public institution involved, the privatization agents shall provide reports regarding the activities carried out and shall have for the period of the mandate the exclusive right to exercise the delegated rights and powers. The mandate is granted in connection with the privatization of one or a group of companies included in special privatization programs by a Government Decision or selected pursuant to the provisions of the methodological norms issued in application of this regulation.
(2) Within 15 days from the receipt from the privatization agent of a proposal for the sale of shares, the mandating public institution involved is obliged to execute the shares sale contract or to communicate the reasons for the rejection of the proposal. In case the time limit is not complied with, the proposal shall be deemed accepted and the privatization agent shall be empowered to execute the contract.
(3) An association can be established by the grouping, pursuant to a temporary joint venture agreement or through a limited liability company or joint stock company formed by one or more privatization agents. In the case of temporary joint venture agreements, the members of the association shall designate a lead contractor with the purpose of participating to the procurement procedure for the award of a mandate under the provisions of this chapter.
Art. 67 - In exercising the attributions set forth in this regulation in respect to one or more companies, the privatization agents shall act in the name and for the account of the public institutions involved and shall be entitled, subject to the terms and conditions of the Mandate Contract, to exercise all rights attached to the shares of such companies, including the exercise of any extraordinary powers and benefits granted to public institutions involved pursuant to this regulation and the methodological norms issued in its application, with the specific exception for any rights to dividends and any preemptive rights.
Art. 68 - ( 1 ) The public institution involved shall organize, through tender, the procurement contests relating to the selection of the privatization agents that shall execute and perform the relevant mandate contracts, in accordance with the procurement methodological norms issued in application of this regulation, ensuring the necessary publicity at a national and international level.
(2) Either in their individual capacity or in association, the privatization agents for consideration under the present ordinance shall meet certain minimum qualification standards, including experience in international privatization and/or privatization or other transactions in Romania, gross revenues or, in the case of associations, consolidated gross revenues of the members in the year preceding the date when the offer is submitted.
(3) The Government shall appoint a commission that shall be responsible for the necessary technical and economical assessment in connection with the valuation of the offers filed by the privatization agents. The valuation of the offers shall take into account, among others, the level of the fees requested by the privatization agents. The commission shall be responsible for drafting the valuation minutes and for the declaration of the prevailing offer.
(4) In case of companies of strategic interest, the main terms of the mandate shall be submitted to the Government for approval.
(5) The public institution involved shall execute any Mandate Contract within 15 days from the date of the decision of the commission referred to in par. (3).
Art. 69 - (1) The compensation of the privatization agents shall include fixed and variable components to be determined based on the effective costs and the successful performance of the mandate, in accordance with the methodological norms issued in the application of this Emergency Ordinance.
(2) The members of a consortium shall be held jointly and severally liable for the failure to perform and for the late or inappropriate performance of the obligations set forth in the Mandate Contract. "
Chapter XI
Final and Transitory ProvisionsArt. 70 - (1) The ongoing privatization procedures at the date when the current Emergency Ordinance was enforced, continue with acceptance of the validity of documents and steps taken so far, in compliance with previous legal provisions. The following procedures are considered as ongoing privatization procedures: sale of shares, if approved by the Board of Administration of the State Ownership Fund, and the sale of assets in case the auction ads have been published. The offers that are not valid anymore due to not undergoing the direct negotiation stage, are extended by 30 more days.
(2) The facilities concerning the free amounts at the disposal of the privatized companies, as stipulated by Law No. 55/1995 as adjusted, including the system of transfer to the state budget, Special Funds for Development at the disposal of the Government and the local budgets, according to Emergency Ordinance No.15/1997 and Emergency Ordinance No. 59/1997, are applicable only in the case of contracts concluded until the date when the current Emergency Ordinance was enforced.
(3) The provisions of par. (2) are also applicable to the companies privatized through direct negotiation, without a Task Book, as well as in the case of companies privatized and sold off to foreign investors who had not been granted an Investor Certificate, or the reimbursement of free currency sums was mentioned.
(4) In the case of contracts that are being negotiated or circumstances when the stage of selection of the potential buyer is not complete, based on the method of privatization set up initially, the State Ownership Fund can agree with the investor upon concluding contracts without including the facilities referring to amount at the disposal of the privatized company. In this particular case, the prospective debts of the company to be privatized are deducted from the price of sold shares, without influencing the value of investments that the buyer commits himself to, and the possible disagreements on the debts will be spread out with the creditors agreement.
(5) The amounts in the current accounts and bank deposits opened and set up by the State Ownership Fund, along with interests resulting from the respective amounts, are in accordance with the legal framework set up, until the enforcement of the current Emergency Ordinance.
Art. 71 - (1) The amounts resulting from the sale with payment by installments of shares issued by companies where the State is a shareholder, are due on the date when the State Ownership Fund is not operational anymore; the respective restructuring credit installments granted according to Law No.58/1991 and Law No.55/1995 and due after this date, as well as other financial revenues owed to the State Ownership Fund are transferred to the State and deposited to the State budget.
(2) Before the establishment of the State Ownership Fund and the five Private Ownership Funds 70 per cent of the amounts resulting from the sale (payment by installments) of shares of companies privatized through privatization pilot-programs initiated by the National Agency for Privatization, are owed to the state after the State Ownership Fund and the Private Ownership Funds or the companies resulting from transformation of the funds cease operations.
(3) Observing the execution of the contracts for the sale (payment by installments) of restructuring credits granted and on due term, as well as other financial revenues owed to the State Ownership Fund, after the date when operations cease, are the responsibility of the Finance Ministry through its branches.
Art. 72 - (1) The provisions of the Chapter IV shall also apply to limited liability companies where the state or a local public administration authorities is a shareholder, except for art. 15 par. (1) let. a), b), d), e) and f).
(2) The provisions of this regulation regarding the sale of the assets of the companies and of the regie autonomous shall be also applicable in the case of the sale of assets of other legal entities in which the state holds the majority interest, as determined by Government Decision.
Art. 73 - Public institutions, regies autonomous and companies where the State or an authority of the public local administration is a shareholder are not entitled to purchase shares or assets, otherwise they undergo penalties of annulment of the sales-purchase contract, except for the provisions in art. 3, lett. (f).
Art. 74 - Within at most 60 days after the current Emergency Ordinance is published in the Romanian Official Gazette, the status of commercial assets included in the State assets through laws and other norms of nationalization, will be set up.
Art. 75 - (1) On the date when the current Emergency Ordinance is enforced, Law No. 58/1991, Law No. 77/1994, Law No. 55/1995, with subsequent adjustments and additions, art. 2 par. (3), art. 5, art. 6 par. (1) and (8), as well as art. 12 par. (1) in the Emergency Ordinance No. 30/1997 approved and adjusted by Law No. 207/1997, as well as art. 4, art. 5, art. 7 par. (2) letter e), art. 11, art. 12, art. 14 par. (2) and art. 17 par. (2) in Law No. 83/1997, published in the Romanian Official Gazette No. 98 on May 32, 1997, Part I are abrogated.
(2) Within 15 days after the enforcement of the current Emergency Ordinance, the Cabinet approves the Methodological Norms for the implementation of the current Emergency Ordinance.
Law No. 99/1999
(as mentioned in Official
Gazette No. 295/June 24, 1999):
Art. II
1. The sales of shares and the sales of assets which are ongoing by the date of the coming into force of this law shall continue in compliance with provisions herein, being, however, acknowledged the validity of the actions and stages accomplished so far.
2. The privatization of companies of strategic interest and of companies formed under the Local Public Administration Law No. 69/1991, the shares of which are in the State Ownership Fund’s portfolio upon the date of entry into force of this law shall be further performed by the State Ownership Fund, unless the Government decides otherwise.
3. In the case of companies resulted from the reorganization of regies autonomous of local interest prior to the coming into force of this law, the attributions provided by art.7 par.(2) shall be exercised by the public institution involved in whose portfolio are included the shares issued by such companies.
4. The administrators of the companies in the name of which the certificate attesting the ownership right over the land has already been issued have the obligation to register with the Trade Registry the increase by law of the social capital in accordance with art. 33 par. (1) within 60 days from the coming into force of this law, the company being exempted from paying fees or any other duties in connection with such registration.
5. All companies, irrespective of the structure of their share capital, that have not received the certificate attesting the ownership right over land shall draw up and submit to the relevant ministries within 90 days from coming into force of this law the documents required for the issuance of such certificate.
6. The relevant ministries shall remit to the companies provided under item 5 certificates attesting ownership right over land and shall forward a copy of the certificate to the State Ownership Fund within 5 days upon the certificate issuing date.
7. The provisions of Section III of Chapter VII of this Emergency Ordinance are also applicable to companies which upon the entry into force of this law are in the process of voluntary liquidation initiated in accordance with Law No. 31/1990.
8. The following actions are considered as violations, unless they are not criminal offences, according to the criminal law:
a) failure to register the share capital increase within the deadline provided for under item 4;
b) failure to submit within the period provided for under item 5 of the documentation necessary for the issue of the certificate attesting ownership rights over land;
c) failure to issue and/or communicate the certificate attesting ownership rights over land within the delay provided under item 6.
The establishment of offences and application of the penalties are made according to art.63 of this regulation.
9. The provisions of this title shall not apply to the land that falls under the incidence of art. 9, art. 22, art. 35 par. (2), art. 38, art. 39, art. 44 par. (1), art. 45, art. 46 and art. 48 of the Land Law No. 18/1991, republished in the Official Gazette of Romania, Part I, No. 1 of January, 5, 1998.
Art. III
1. On the date of the coming into force of this title, art. 7, 8 and 9 of the Emergency Ordinance No. 10/1997, approved with amendments by Law No. 151/1997, as well as any other provisions contrary to this law, are repealed.
2. Within 30 days from the publication of this law, the Government shall approve the methodological norms, the rules regarding the organization and functioning of the State Ownership Fund, as well as the privatization strategy for 1999.
3. Within 3 months from the coming into force of this title, the Government shall approve the list of the companies of strategic interest.
4. This title shall enter into force within 30 days from the publishing of this law in the Official Gazette of Romania, except for art. III pct.2 which shall be in force from the publication date.
5. The Government Emergency Ordinance No. 88/1997 regarding the privatization of the companies, published in the Official Gazette of Romania, Part I, No. 381 of December 29, 1997, approved by the Law No.44/1998, published in the Official Gazette of Romania, Part I, No. 88 from February 25, 1998, as amended before and by this law, shall be republished in the Official Gazette of Romania and its provisions shall be renumbered.