October 2009

Domestic regulatory updates 3

Legal 4

1. Banking 4

2. Insurance 7

3. Private pensions 8

4. Capital Markets 9

Tax 10

International regulatory updates 11

Domestic regulatory proposals 13

1. Banking 14

2. Insurance 15

3. Private pensions 16

International regulatory proposals/measures 17

Financial Services Industry Monthly Bulletin 8

4

Issuer: Romanian Government

Romanian Government regulates the payment

services in view of implementing into national

legislation Directive 2007/64/EC of the European

Parliament and of the Council as of 13

November 2007 regarding payment services in

the internal market

Romanian Government adopted Emergency

Ordinance no. 113/2009 regarding the payment

services published in the Official Gazette no.

685/12.10.2009 (“GEO 113/2009”). The main

provisions of GEO 113/2009 refer to:

Scope

GEO 113/2009 covers the following categories

of payment services providers:

credit institutions;

electronic currency issuers;

postal services providers that provide

payment services under the applicable

national legal framework;

payment institutions as per GEO 113/2009;

European Central Bank and national central

banks when they are not acting as

monetary authorities or in any other quality

implying the exercise of public authority;

Member States or their regional or local

authorities when they are not acting in their

capacity of public authorities.

Conditions related to the payment services

providers

A payment institution is defined as the legal

entity authorized under GEO 113/2009 to

provide payment services within the

European Union and European Economic

Area. The conditions which must be

observed by an entity in order to provide

payment services in Romania are:

to obtain an authorization before starting

its activity from the National Bank of

Romania (“NBR”);

to be established in accordance with the

provisions of Companies’ Law no. 31/1990;

its initial capital to be between EUR 20.000

and EUR 125.000, depending on the

rendered payment services;

its headquarter to be located in Romania;

in view of maintaining a healthy and

prudent management, NBR must ascertain

that the persons responsible for leading and

managing its activity have a good

reputation and an adequate knowledge

related to the nature, extension and

complexity of its activity.

Payment services

The payment services can be performed under

single payment transactions, framework

contracts and related payment operations, if the

user acts as a consumer.

Through a payment service it is to be understood

any of the following activities:

services that allow to deposit/withdraw cash

into/from a payment account, as well as all

of the operations necessary to operate that

payment account;

performance of the following payment

operations irrespective whether the funds

are covered or not by a credit line: direct

debit, including single direct debit, payment

operations through a payment card or

similar device, transfer of credit operations,

including operations with scheduled

payment orders;

issuance and/or acceptance for payment of

payment instruments;

delivery of money;

performance of payment operations in

which the payer's consent to carry out a

payment transaction is given through any

telecommunication system, digital or

informatics, and the payment is made by

the operator of the system or of the

telecommunications or computer network

that acts exclusively as an intermediary

between the user of the payment services

and the supplier of goods and services.

Financial Services Industry Monthly Bulletin 5

Regulations repealed

Regulation 20/2009 repeals a series of Norms

issued by NBR regulating: NBFI minimal share

capital; General, Special and Evidence Registries;

notification and registration procedures within

the said registries; criteria for the registration

with the Special Registry; changes within NBFI

status; NBFI own funds; supervision of NBFI

exposures; organization and internal control, the

administration of significant risks, as well as the

performance of internal audit.

NBR amends the regulatory framework

regarding payment institutions

NBR issued Regulation no. 21/2009 regarding

payment institutions (“Regulation 21/2009”)

which was published in the Official Gazette no.

735/ 29.10.2009, being able to be accessed

here.

Further to the recent entry into force of the GEO

113/2009 which sets forth that the payment

services shall only be provided by payment

institutions authorized by NBR, the said authority

issues the Regulation 21/2009 setting forth the

conditions which must be met by an undertaking

in order to be authorized as a payment

institution along with changes in the activity of

such institution that requires NBR prior approval.

The most important new elements brought by

Regulation 21/2009 are described below as

follows:

Authorization process

Among the conditions to be observed by the

entity requesting to be authorized as a payment

institution we underline:

to have an initial share capital between EUR

20.000 and EUR 125.000, depending on

the rendered payment services;

The entities providing payment services upon the

date when GEO 113/2009 entered into force

must apply for an authorization with NBR until

December 31st

, 2010. If these entities shall not

be authorized under GEO 113/2009 until April

30th

, 2011, then they shall not be allowed to

provide payment services any longer.

With respect to the ongoing contracts, the

payment services providers have the obligation

to ensure the compliance of the contract with

the provisions of GEO 113/2009 within 45 days

as of its entering into force. GEO 113/2009

entered into force on November 1st

, 2009.

Issuer: National Bank of Romania (“NBR”)

NBR amends the current legal framework

regarding non banking financial institutions

NBR issued Regulation no. 20/2009 regarding

non-banking financial institutions (“Regulation

20/2009”) which was published in the Official

Gazette no. 707/21.10.2009 and may be

accessed here. The main provisions of Regulation

20/2009 refer to:

Registration of Non Banking Financial Institutions

(“NBFI”)

Regulation 20/2009 details the legal

requirements and the documentation necessary

for the registration of NBFI with the General,

Special or Evidence Registries.

Prudential requirements

Regulation 20/2009 provides a set of prudential

requirements applicable to NBFI in relation to:

the computation of own funds and their

minimum level; the maximum limits of

exposures; the general framework regarding the

organization, internal control and audit as well

as administration of significant risks.

6

to have as business scope of activity only

payment services that shall effectively be

performed;

shareholders and the persons responsible

for leading and managing the activity to

have a good reputation and an adequate

knowledge related to the nature, extension

and complexity of its activity.

Furthermore, Regulation 21/2009 obliges the

undertakings which provide payment services

upon the date when Payment Ordinance entered

into force to apply for an authorization with NBR

until December 31st

, 2010.

Changes within the activity of a payment

institution

Regulation 21/2009 provides also some changes

in the activity of a payment institution which are

subject to the prior approval of NBR such as:

Amendment of the business scope of

activity;

Change of the persons responsible for

leading and managing the payment services

activity;

Opening of branches within third party

countries;

Outsourcing important operational services

in connection with the payment services.

NBR repeals the norms for the application of Law

no. 289/2004 regarding the legal regime for

consumer credits for individual consumers

NBR issued Order no. 8/2009 repealing NBR’s

Order and of the president of the National

Authority for Consumers Protection no.

2/231/2005 on the approval of Norms for

implementing Law no. 289/2004 regarding the

legal regime of consumer credit contracts for

individual consumers. The above mentioned

Order was published in the Official Gazette no.

675/08.10.2009.

NBR’s Circular no. 36/2009 regarding the level of

the reference interest rate applicable in October

2009, namely 8.5 % per year

The above mentioned Circular was published in

the Official Gazette no. 648/1.10.2009 and may

be accessed here.

Financial Services Industry Monthly Bulletin 7

Issuer: Insurance Supervision Commission

(“ISC”)

ISC amends the current regulatory framework

regarding the Insurance Pool against Natural

Disasters

ISC issued Order no. 20/2009 for the

amendment of the Norms regarding the

Insurance Pool against Natural Disasters as

approved through ISC’s Order no. 17/2009.

The above mentioned Order was published in

the Official Gazette no. 691/14.10.2009 and

may be accessed here

8

Issuer: Private Pension System Supervision

Commission (“PPSSC”)

PPSSC amends the current regulatory framework

regarding the threshold applicable to the

investments made by privately administered

pension funds in treasury bills

PPSSC issued Decision no. 24/2009 for the

approval of Norm no. 16/2009 for the

amendment of Norm no. 22/2008 for the

temporary amendment of the threshold

applicable to the investments made by privately

administered pension funds in treasury bills and

approved through PPSSC’s decision no. 38/2008.

The above mentioned decision was published in

Official Gazette no. 693/15.10.2009 and may be

accessed here.

PPSSC amends the current regulatory framework

regarding the threshold applicable to the

investments made by voluntary pension funds in

treasury bills

PPSSC issued Decision no. 25/2009 for the

approval of Norm no. 17/2009 for the

amendment of Norm no. 23/2008 for the

temporary amendment of the threshold

applicable to the investments made by voluntary

pension funds in treasury bills and approved

through PPSSC’s decision no. 39/2008.

The above mentioned decision was published in

Official Gazette no. 693/15.10.2009 and may be

accessed here.

Financial Services Industry Monthly Bulletin 9

Issuer: National Securities Commission (“NSC”)

NSC amends the current legal framework

regarding the registration of groups

NSC enacted Order no. nr. 55/2009 for the

approval of Instruction no. 5/2009 for the

amendment of Instruction no. 11/2005

regarding the registration of groups with NSC.

The above mentioned Order was published in

Official Gazette no. 737/ 29.10. 2009. The text

of the above mentioned Instruction may be

accessed here

NSC amends the current legal framework

regarding the income of the institution

NSC enacted Order no. 54/2009 for the approval

of Regulation no. 7/2009 for the amendment of

Regulation no. 7/2006 regarding the incomes of

NSC. The above mentioned Order was published

in Official Gazette no. 736/29.10.2009 and may

be accessed here

NSC suspends the application of certain

provisions of Regulation 1/2006 regarding

issuers and operations with securities

NSC decided through Decision no. 16/2009 that

the application of Article 69 (1), (2) and (4) of

Regulation no. 1/2006 regarding issuers and

operations with securities, referring to the

professional and independency conditions

evaluators must met, is suspended until the

entering into force of the amendments of NSC’s

regulations regarding independent evaluators.

The text of the above mentioned decision can be

accessed here

NSC decided to forbid the execution of

contractual relationships between authorized

entities and the persons sanctioned with a

misdemeanor and to whom the complementary

measure of forbidding to carry out their activities

was applied

NSC decided through Decision no.

1522/26.10.2009 that authorized entities,

regulated and supervised by NSC cannot enter

into contractual relationships regarding specific

activities related to capital market which implies

performance from persons being under the

provisions of Article 273 (1) letter (c) point 3 of

Law nr. 297/2004 regarding capital markets,

namely which have been sanctioned with a

misdemeanor and to whom the complementary

measure of forbidding to carry out their activities

was applied.

The text of the above mentioned decision can be

accessed here

NSC confirmed the possibility of executing

transactions outside a regulated market or an

alternate transaction system

NSC issued the decision nr. 203/28.10.2009

confirming the possibility to execute transactions

outside a regulated market or an alternate

transaction system for financial instruments not

admitted to be transacted on a regulated market

and/or sold in an alternate transaction system

within Romania or on RASDAQ market.

Moreover, it is expressly provided that the

mechanisms based on which the above

mentioned transactions are carried out do not

fall under the provisions of Law no. 297/2004

regarding capital markets.

The text of the above mentioned decision can be

accessed here

NSC decided through decision no.

1501/20.10.2009 that the evaluation report

based on which the price within a mandatory

takeover offers is determined shall be made

available to the shareholders in the same

conditions as the offer itself

The above mentioned decision can be accessed

here

Other individual acts issued by NSC which may

present interest to the participants to the capital

market

Ordinance no. 587/22.10.2009 regarding

the evaluators’ obligation to act impartially

Decision no. 1511/22.10.2009 regarding

the computation of the value of the stocks

based on income approach

Decision no. 1512/22.10.2009 regarding

the computation of the value of the stocks

based on income approach

10

Issuer: Romanian Government

Romanian Government issued Ordinance no.

109/2009 for amending and completing the

Fiscal Code. Those amendments will enter into

force starting 1 January 2010.

The above mentioned Ordinance was published

in the Official Gazette no. 689/13 October 2009.

For companies operating in the financial sector,

the deadline for submitting the corporate

income tax returns is modified, as follows:

- Taxpayers (except for the banks) that

finalize until 25 February the closing of the

previous financial year shall submit the annual

corporate income tax return by 25 February.

- The deadline for submitting the annual

corporate income tax return is set to 25 April

(banks included).

The deadline for paying the withholding tax on

dividends which were not paid until the end of

the year has been extended until 25 January of

the following year.

The deadline for submitting of the annual

withholding declaration concerning the

computation and withholding of tax was

extended to 30 June of the following year.

In case of companies operating in the financial

sector that have as shareholders pension funds,

as defined in the legislation of the European

Union member states, interest and / or dividends

paid to such funds are exempt from withholding

tax in Romania.

From a VAT perspective, the Fiscal Code

implements the new rules adopted by the EU

with regard to the place of taxation of services.

The main rule for services rendered to taxable

persons is that the place of taxation shall be the

place where the beneficiary has established its

business or has a fixed establishment to which

the services are rendered.

The financial-banking institutions and insurance

companies will have new reporting requirements

for services acquired from suppliers established

in EU, which are taxable in Romania through a

reverse-charge mechanism.

Also, as a consequence of the new rules, the

financial institutions not registered for VAT

purposes (e.g. insurance companies) will have to

register in this respect for acquisitions of services

from EU companies.

Recently, the European Court of Justice decided

that the transfer of life reinsurance portfolio is

subject to VAT (case C-242/08). An aspect that

deserves a closer consideration is whether this

decision may be extended to the financial

transactions (e.g. transfer of loan portfolio).

However, an automatic extension of this decision

to other transactions is not likely, as each

transaction has different characteristics and even

the scope of the VAT exemption is different.

Financial Services Industry Monthly Bulletin 9

12

European Union amends the regulatory

framework regarding cross border payments

European Parliament and the Council adopted

Regulation (EC) No 924/2009 as of 16

September 2009 on cross-border payments in

the Community and repealing Regulation (EC)

No 2560/2001

The said Regulation was published in Official

Journal of the European Union no.

266/9.10.2009 and may be accessed here

European Union amends the regulatory

framework regarding electronic money

institutions

European Parliament and the Council adopts

Directive 2009/110/EC as of 16 September 2009

on the taking up, pursuit and prudential

supervision of the business of electronic money

institutions amending Directives 2005/60/EC and

2006/48/EC and repealing Directive 2000/46/EC.

The above mentioned Directive was published in

the Official Journal of the European Union no.

267/10.10.2009 and may be accessed here

European Council amends the regulatory

framework regarding the collection of statistical

information by the European Central Bank

European Council adopted Regulation (EC) no.

951/2009 as of 9 October 2009 amending

Regulation (EC) no. 2533/98 concerning the

collection of statistical information by the

European Central Bank.

The above mentioned Regulation was published

in the Official Journal of the European Union no.

269/14.10.2009 and may be accessed here

Commission notice on current State aid recovery

interest rates and reference/discount rates for 27

Member States applicable as of October 1st

2009.

The said notice was published in the Official

Journal of the European Union no.

236/1.10.2009 and may be accessed here

12

14

Proposal for a norm for the amendment of NBR’s

Norm no. 26/2006 regarding statistical reporting

of the data necessary for drafting the payment

balances

The above mentioned proposal is now available

for public discussions, with any comments being

able to be send until 15.11.2009 and may be

accessed here

Proposal for a Regulation regarding the use of

advanced evaluation approach and the approval

of such approach by credit institutions for the

operational risk

The above mentioned proposal is now available

for public discussions, with any comments being

able to be send until 20.11.2009 and may be

accessed here

Financial Services Industry Monthly Bulletin 15

Proposal for an Order for the approval of the

accounting regulations applicable to insurance,

insurance – reinsurance and reinsurance

companies

The above mentioned proposal may be accessed

here

Proposal for Norms regarding the professional

qualification and continuous training of

insurance brokers

The above mentioned proposal may be accessed

here

Proposal for Norms regarding an unitary

professional development of the persons

engaged within insurance filed

The above mentioned proposal may be accessed

here

16

Proposal for a Norm regarding reporting and

transparency obligations in the private

administered pension system

The text of the above mentioned proposal may

be accessed here

Proposal for a Norm regarding the adhering and

evidence of the participants to the private

administered pension funds

The text of the above mentioned proposal may

be accessed here

Proposal for a Norm for the amendment of

Norm no. 11/2008 regarding the collection of

individual contributions of the participants to the

private administered pension funds

The text of the above mentioned proposal may

be accessed here

Proposal for a Norm regarding the minimum

rentability of all private administered pension

funds

The text of the above mentioned proposal may

be accessed here

Financial Services Industry Monthly Bulletin 15

18

European Commission has adopted additional

legislative proposals to strengthen financial

supervision in Europe

The European Commission has adopted on

26.10.2009 additional legislative proposals to

further strengthen financial supervision in

Europe, aiming to create a European System of

Financial Supervisors by establishing three new

European Supervisory Authorities: European

Banking Authority, European Insurance and

Occupational Pensions Authority and European

Securities and Markets Authority.

For further details please click here

The Commission proposes future policy actions

to strengthen the safety of derivatives markets

The European Commission has adopted on

20.10.2009 a Communication for ensuring

efficient, safe and sound derivatives markets.

The Communication sets out future policy

actions to increase transparency of the

derivatives market, reduce counterparty and

operational risk in trading. For more details,

please click here

Opinion of the European Central Bank of 29

September 2009 on a proposal for a Council

Regulation on the introduction of the euro

For further details please access the following

link

Compendium Paper on the supervisory

implementation practices across EU Member

States of the Third Money Laundering Directive

For further details please access the following

link

The Federal Reserve, along with the other

financial regulators of the Federal Financial

Institutions Examination Council has adopted a

policy statement on Prudent Commercial Real

Estate Loan Workouts

For more details please click here

Financial Services Industry Monthly Bulletin 9

Reff & Associates is the correspondent law firm of Deloitte Romania, fully

integrated with the Deloitte multi-disciplinary advisory practice and affiliated to a

network of law firms and legal departments working with Deloitte all over the

world. Deloitte’s correspondent legal practice provides assistance to clients in

Romania on various matters pertaining to mergers and acquisitions, corporate

and commercial law, finance, banking and capital markets, real estate, project

finance, employment, competition, fiscal and commercial litigation, and

intellectual property.

In the financial services sector, Reff & Associates provides the full range of services

to banks and financial institutions, including:

- Finance deals: transaction support in bilateral and syndicated loans, loan

workouts, securitisation, loan transfers and assists in drafting and

negotiating the transaction documentation (loan agreements, security and

other ancillary documentation).

- M&A transactions in the financial services sector: advice on the structure

of the transaction, the pre-contractual documentation, due diligence,

drafting/negotiating the purchase agreements and assisting the

implementation of the transaction.

- Regulatory assistance: ongoing assistance with respect to the specific

legal and regulatory requirements applicable to banks / non banking

financial institutions operating in Romania, development of new

financial products, representation in front of the regulators (National

Bank of Romania, Insurance Supervisory Commission, Securities

Commission etc.).

Andrei Burz Pinzaru

Partner

+ 40 21 207 52 05

aburzpinzaru@deloittece.com

Simina Mut

Manager

+ 40 21 207 52 69

smut@deloittece.com

Leontin Trifa

Manager

+ 40 21 207 53 13

ltrifa@deloittece.com

George Mucibabici Chairman

tel: + 40 21 207 52 55

e-mail: gmucibabici@deloittece.com

Audit Santiago Pardo

Partner

tel: + 40 21 207 54 92

e-mail: sapardo@deloittece.com

Enterprise Risk Services Gary Bauer

Director

tel: + 40 21 207 52 19

e-mail: gbauer@deloittece.com

Financial Advisory Antonis Ioannides Partner

tel: + 40 21 207 56 26

e-mail: anioannides@deloittece.com

Tax Rodica Segarceanu

Partner

tel: + 40 21 207 52 31

e-mail: rsegarceanu@deloittece.com

Legal Andrei Burz-Pinzaru

Partner, Reff&Associates

correspondent law firm of Deloitte Romania

tel: + 40 21 207 52 05

e-mail: aburzpinzaru@deloittece.com

Consulting Razvan Horobeanu Manager

tel: + 40 21 207 53 57

e-mail: rhorobeanu@deloittece.com

Actuarial & Insurance Solutions Slawomir Latusek

Consultant

tel: + 48 (22) 511 04 54

e-mail: slatusek@deloittece.com

Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member firms,

each of which is a legally separate and independent entity. Please see www.deloitte.com/ro/about for a

detailed description of the legal structure of Deloitte Touche Tohmatsu and its member firms.

Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning

multiple industries. With a globally connected network of member firms in more than 140 countries, Deloitte

brings world-class capabilities and deep local expertise to help clients succeed wherever they operate.

Deloitte's more than 168 000 professionals are committed to becoming the standard of excellence.

Deloitte's professionals are unified by a collaborative culture that fosters integrity, outstanding value to

markets and clients, commitment to each other, and strength from cultural diversity. They enjoy an

environment of continuous learning, challenging experiences, and enriching career opportunities. Deloitte's

professionals are dedicated to strengthening corporate responsibility, building public trust, and making a

positive impact in their communities.

This publication contains general information only, and none of Deloitte Touche Tohmatsu, its member firms,

or its and their affiliates are, by means of this publication, rendering accounting, business, financial,

investment, legal, tax, or other professional advice or services. This publication is not a substitute for such

professional advice or services, nor should it be used as a basis for any decision or action that may affect your

finances or your business. Before making any decision or taking any action that may affect your finances or

your business, you should consult a qualified professional adviser.

None of Deloitte Touche Tohmatsu, its member firms, or its and their respective affiliates shall be responsible

for any loss whatsoever sustained by any person who relies on this publication.

© 2009 Deloitte Romania