Thinking of going public? IPO-related expenses can now be covered by a grant under NRRP

√     Grant of up to EUR 200,000 for listing on the main market and EUR 25,000 for listing on AeRO
√     Broad range of expenses coverable, including legal, financial and ESG advisors’ fees, as well as auditors’ and intermediary’s fees
√     Allocated budget of EUR 35m, scheme applicable until 30 June 2025
√     Issuers with ongoing IPOs may also benefit if admission to trading does not occur prior to the execution of the financing agreement
√     Issuers’ industry relevant for eligibility criteria

One less hurdle in issuers’ journey towards the local capital markets – if until now listing expenses were thoughtfully factored in in issuers’ assessment of the listing process and may have advocated for deciding to avoid or postpone the decision of going public, these should no longer be a concern.

Ministry of European Investments and Projects’ (MIPE) Order No. 348/2023 for the approval of the de minimis aid scheme “Companies’ listing on the stock exchange” (the Order) was published on 27 February 2023 in the Official Gazette of Romania. The Order provides the conditions under which Romanian companies envisaging admission to trading on the main market or the AeRO market operated by the Bucharest Stock Exchange (BSE) may benefit from non-reimbursable financial aid covering IPO-related expenses. The aid scheme aimed at supporting access to the capital markets was approved with a view to accessing European funds under the National Recovery and Resilience Plan (NRRP). This legal update briefly presents the conditions under which companies may benefit from grants under this aid scheme.

1.     Grant amounts and coverable expenses

The grant amount (the Grant) that an issuer can benefit from is determined as follows:

  • a cap of EUR 200,000 (for main market listing), respectively EUR 25,000 (for AeRO listing) applies;
  • a second cap of 8% of the total amounts subscribed in the primary IPO applies; and
  • covered expenses may not exceed 70% of the total eligible expenses.

The following type of expenses are eligible for coverage, within the limits set out above:

  • fees, commissions and other costs related to admission to trading payable to capital markets institutions (Financial Supervisory Authority, BSE, Central Depository and any other institutions with regulatory role);
  • fees payable to legal advisors for assistance related to prospectus and pre-listing steps;
  • financial auditors’ fees and fees payable for financial and accounting advice;
  • fees payable to the intermediary;
  • fees for advice related to sustainability report and the ESG rating;
  • fees related to amendments of issuer’s internal functions and processes to address capital markets’ investors requests (such fees can be incurred both prior and post-listing).

2.     Eligibility criteria and excluded activities

Issuer eligibility criteria:

  • Headquartered in Romania;
  • Majority of the capital is privately owned;
  • Does not operate in the excluded industries or perform excluded activities;
  • Envisages a primary IPO (i.e., public offer via the issuance of new shares);
  • Any legal form works (although conversion into joint stock is anyhow a necessary step for admission to trading);
  • Pre-qualifies for admission to trading, namely:
    • AeRO – (i) free float of 10% or minimum 30 shareholders and (ii) own capitals or anticipated market capitalization of minimum EUR 250,000;
    • Main market – (i) free float of 25%, (ii) minimum three (3) years of financial reporting and (iii) own capitals or anticipated market capitalization of minimum EUR 1m.

Excluded activities include:

  • Fishing and aquaculture;
  • Primary production of agricultural products;
  • Processing and marketing of agricultural products[1];
  • Gambling and tobacco industries.

In addition, eligible issuers must prove the observance of the principle of “Do No Significant Harm” (DNSH) which implies that the actions outlined in national NRRPs should not cause any significant harm to the environment[2]. An issuer that has obtained more than 50% of its revenues in the previous financial year from activities or assets falling under the DNSH exclusions list may still benefit from the Grant if it undertakes to adopt and publish a plan for green transition within one (1) year from the signing of the financing agreement.

3.     Timeline

  • The aid scheme applies starting with 27 February 2023 until the EUR35m budget is used up, but no later than 30 June 2025.
  • The budget is indicatively allocated per years, with EUR10m in 2023 and 2025 and EUR 15m allocated for 2024, unused amounts being carried forward to the following year.
  • Payments will be made until 31 December 2026.

4.     Steps and guidance

  • In order to benefit from the Grant, issuers must submit a file including the request, as well as various statements, draft versions of which were already published by MIPE.
  • MIPE also approved and published the specific guide regulating the terms for accessing the Grant, which can be found here.

[1]              Certain conditions apply.

[2]             As regulated under EU Regulation 2020/852.


*This ePublication is provided by Radu Taracila Padurari Retevoescu SCA and is for information purposes only. It does not constitute legal advice or an offer for legal services. The distribution of this document does not create an attorney−client relationship. If you require advice on any of the matters raised in this document, please call your usual contact at Radu Taracila Padurari Retevoescu SCA at +40 31 405 7777.