Following the issuance of the Presidential Decree No. 240/2020, the state of emergency has been extended in Romania for an additional 30-day period. As a result, the already approved social distancing measures will continue to apply and further such measures are expected to be implemented. The social changes brought by such measures have impacted all businesses and activities, therefore slowing down day-to-day processes and operations which were otherwise routine. One of these processes was the preparation, approval and submission of annual financial statements and accounting reports. Given that the deadline for submission with the authorities thereof was rapidly approaching, the Romanian Government passed the Government Emergency Ordinance No. 48/2020 regarding fiscal and financial measures (GEO 48/2020) which was published on 16 April 2020.
GEO 48/2020 provides, inter alia, for the postponement of the obligation to submit with the territorial units of the Ministry of Public Finances the annual financial statements for the 2019 financial year, respectively, the annual accounting reports as of 31 December 2019.
1. Concerned entities
GEO 48/2020 refers to the following entities within the scope of the Accounting Law No. 82/1991 (the Accounting Law):
a) the companies regulated by the Company Law No. 31/1990 (the Company Law); state owned companies, sovereign owned autonomous companies (in Romanian, regii autonome); national institutes for research and development; cooperative companies (in Romanian, societăți cooperatiste);
b) public institutions, associations and other legal entities, including non-profit entities;
c) foreign subunits without legal personality of entities in (a) and (b) above, which are registered in Romania, as well as Romanian subunits without legal personality (e.g., branches) of entities registered abroad;
d) investment funds incorporated under the Romanian Civil Code (i.e., not under the Company Law); voluntary pension funds; privately managed pension funds and other entities established pursuant to the provisions of the Romanian Civil Code; and
e) entities undergoing liquidation proceedings.
2. Postponed obligations
- the obligation to submit the annual financial statements, incumbent on entities under section 1 items (a)-(c) above;
- the obligation to submit annual accounting reports, incumbent on entities under section 1 item (e) above; and
- the obligation to submit annual accounting reports, upon the request of the Ministry of Public Finances, incumbent on entities under section 1 items (a)-(d)
3. New deadline
GEO 48/2020 establishes a single deadline for all above-mentioned obligations, i.e., up to and including 31 July 2020. This replaces the various deadlines provided by the Accounting Law for the entities under section 1. We note that this is a temporary measure applicable only in respect of the 2019 financial year and not a definitive amendment concerning future financial years.
In addition, we note that, according to a draft government emergency ordinance for certain measures regarding companies, which is expected to enter into force soon, the deadline for holding the annual general meetings of shareholders for the approval of financial statements is intended to be delayed until 15 July 2020.
The changes brought to convening and holding shareholders’ meetings provided by the above-mentioned draft will be dealt with shortly in our Emergency Journal. Stay tuned.
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