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MasterClass in Construction Contract Administration: A Pioneering Initiative by Gherghina Oana and the Regional Centre for European Studies

The Regional Centre for European Studies (RCES), an esteemed online executive education institution in Europe, has launched an innovative MasterClass focused on the Administration of Construction Contracts. This course is a testament to the RCES's commitment to offering expert-led academic programs that have already transformed the lives of thousands globally​​​​.

At the helm of this MasterClass is Prof. Dr. Oana Gherghina, a distinguished figure in the field of construction law. Dr. Gherghina, the President of the RCES Scientific Committee and Managing Partner of Gherghina Law holds a Ph.D. in Construction Law and is an acclaimed author of two Construction Law books and numerous international scientific articles. With two decades of experience as a business attorney and her extensive academic involvement, including her role as a Business Law and European Union Law Professor at FABIZ Bucharest, Dr. Gherghina is uniquely positioned to lead this program​​​​.

The MasterClass is designed to delve into the nuances of contract formulation, negotiation, and administration in the construction sector. It promises to equip participants with the necessary skills to confidently navigate contracts, mitigate risks, and efficiently settle disputes and resolutions. This initiative by RCES and Dr. Gherghina aims to fortify the participants' knowledge base, setting a strong foundation for successful construction projects​​​​.

Through this course, Dr. Gherghina plans to guide participants through the intricacies of construction contracts, leveraging her extensive practical experience and theoretical knowledge. The course aims to transcend beyond textbook knowledge, offering insights rooted in real-life experiences and rich legal expertise. This approach is expected to provide a comprehensive understanding of the subject, crucial for professionals involved in the construction industry​​.

In summary, the MasterClass on the Administration of Construction Contracts is a significant step forward in professional education in the field of construction law and contract management. Under the guidance of Prof. Dr. Oana Gherghina and backed by the expertise of the RCES, this course is set to empower professionals with the knowledge and skills required for effective construction contract administration.

Romania’s New Sustainability Code: A Step Towards Enhanced Transparency and Sustainability

The recent implementation of HG 1.117/2023 marks a pivotal development in Romania's approach to corporate sustainability and transparency. As of November 21, 2023, the Romanian Sustainability Code, introduced and published in the Official Monitor, offers an optional framework that can be adopted not only by companies obligated to submit non-financial declarations but also by those not currently required to do so.

The Romanian Sustainability Code, crafted by the General Secretariat of the Government, serves as a significant tool in the realm of sustainability reporting. Unlike traditional legislative codes, this methodology aims to broaden the scope of entities engaging in sustainability reporting, focusing on enhancing the transparency and comparability of these reports. This initiative addresses the growing need for clarity and uniformity in non-financial information, which is becoming increasingly important to stakeholders like investors and consumers.

This new normative act brings about a substantial shift in the sustainability reporting landscape. By simplifying and making the reporting process more transparent, it ensures that all reports are accessible on a unified platform, benefiting all interested parties. The methodology not only provides explicit guidance on what should be included in sustainability reports but also makes the process more comprehensible for companies.

The adoption of this methodology offers numerous advantages, including increased transparency, streamlined reporting processes, elevated visibility for reporting companies, and easier access to best practices in sustainability. Notably, the use of the Sustainability Code is free for both obligated entities and those choosing to participate voluntarily.

In conclusion, the Romanian Sustainability Code represents a crucial step in promoting sustainability and transparency within the Romanian business environment. By embracing this methodology, companies can demonstrate their commitment to sustainable development in a coherent and transparent manner, thereby enhancing stakeholder trust in their activities.

It's important to note that starting in 2024, the non-financial declaration will be replaced with a sustainability report, and a broader range of companies will be required to submit these reports than currently.

Spune STOP linșajului emoțional la locul de muncă! Instanțele din Romania au obligat șefii abuzivi la daune de 100.000 euro!

Astazi, 02.11.2020, dna. Dr. Av. Gherghina Oana, Partener al Casei de avocatura Gherghina a fost invitată în direct la emisiunea Metropola TV "Dimineți cu Georgia"  pentru a discuta despre hărțuirea la locul de muncă. Dezbaterea a stârnit un larg interes în rândul publicului, motiv pentru care aprecim utilă o trecere în revistă a principalelor dispoziții legale în materie. Pentru a urmări emisiunea TV pe Facebook, apăsați aici 

Hărţuirea morală la locul de muncă este un fenomen destul de des întâlnit în raporturile juridice de muncă, fiind "unealta" cel mai des folosită atunci când se doreşte eliminarea unui angajat. Determinarea unui angajat de a-și  da demisia prin aplicarea asupra acestuia a oricărei forme de hărțuire este varianta "low-cost" preferată de angajatori în detrimentul concedierii legale, care este mult mai costisitoare.

Statisticile la nivelul Uniunii Europene arată că 10% din angajati sunt victime ale unei forme de hărțuire, fie ea fizică, psihologică sau sexuală, așadar fenomenul nu este nici pe departe marginal, fiind regăsit atât în companii mici, cu puțini angajați cât și la nivelul companiilor sau corporațiilor multinaționale cu un număr mare de angajați.

Hărțuirea morală la locul de muncă nu se regăsea ca atare, cu o definiție exactă în legislația din Romania, însă, asta nu înseamnă că astfel de fapte nu au fost sancționate de instanțele de judecată cu daune foarte mari, cum este cazul în Dosar nr. 6294/117/2014 , unde prin Decizia civilă nr.2658/a/2016 Curtea de Apel Cluj a obligat societatea publică de radiodifuziune să recompenseze suferința psihică a unui angajat hărțuit la locul de muncă cu suma de 100.000 euro

În prezent, legislația în materie a fost îmbunătățită prin Legea 167/2020,  publicată în plină pandemie de Covid 19.

Este important să rețineți că nimeni nu trebuie să suporte niciun fel de formă de hărțuire la locul de muncă, cu atât mai mult cu cât, hărțuirea morală la locul de muncă se sancționează disciplinar, contravențional sau penal, după caz.

Mereu clienții ne întreabă "Ce întelegem prin hărțuire morală, sau mobbing? Care  sunt limitele când o critică...fi ea si mai agresivă, devine un act de hărțuire?"

Actualmente, chiar legiuitorul a acordat o definiție acestei noțiuni, precizând că prin hărțuire morală înțelegem orice comportament exercitat cu privire la un angajat de către un alt angajat care este superiorul său ierarhic, de către un subaltern și/sau de către un angajat comparabil din punct de vedere ierarhic, în legătură cu raporturile de muncă, care să aibă drept scop sau efect o deteriorare a condițiilor de muncă prin lezarea drepturilor sau demnității angajatului, prin afectarea sănătății sale fizice sau mentale ori prin compromiterea viitorului profesional al acestuia.

Astfel, semnele acestui fenomen pot îmbrăca forme diverse, de la izolare şi ignorare completă, la atac la persoană, umilire, discreditare prin cuvinte jignitoare adresate direct sau sub forma unor bârfe repetate cu alţi colegi, acordrea unor calificative incorecte, refuzul de a recunoaste meritele profesionale, de a respecta criteriile de promovare sau de a acorda bonusuri sau alte compensații materiale, ridiculizare, critici nefondate, aluzii cu privire la viața personală sau activitatea profesională, discriminare pe baza de gen, nationalitate, etnie sau alte forme de discriminare, remarci nepotrivite legate de vârstă, sănătate sau pregătirea profesională, etc.

Trebuie să știți că vă confruntați cu fenomenul de hărțuire morală la locul de muncă când acțiunile sau inacțiunile au un caracter sistematic și pot aduce atingere demnității, integrității dvs. fizice ori mentale sau când vă pun în pericol munca sau degradează climatul de lucru, așa încât, o situație nefericită cu un caracter izolat, fără consecințe grave nu se va putea încadra în această categorie de fapte.

Cu toate acestea, conform noii legi, inclusiv stresul și epuizarea fizică intră sub incidența hărțuirii morale la locul de muncă, așadar învățați să spuneți NU oricăror solictări din partea angajatorului cară vă pot afecta emoțional și mai ales... refuzați să fiți victime!

Din păcate, de cele mai multe ori, angajatul hărţuit psihologic acceptă condiţiile incorecte de lucru, cum ar fi schimbarea postului, scăderea salariului cu păstrarea sarcinilor de lucru sau chiar cu o creştere a volumului de muncă, în speranța că tortura emoțională va înceta, însă de multe ori nu se întâmplă așa. Angajaţii linșați emotional ajung să aibă un nivel scăzut de încredere în propriile forţe, competenţe şi abilităţi, efectele mobbing-ului exercitat pe termen lung având consecințe grave asupra sănătății victimei, care în multe situaţii renunţă la lupta inegală și își dă demisia spre satisfacția agresorului.

Fiecare angajat are dreptul la un loc de muncă lipsit de acte de hărțuire morală, așa încât niciun angajat nu va putea fi sancționat, concediat sau discriminat, direct sau indirect, inclusiv cu privire la salarizare, formare profesională, promovare sau prelungirea raporturilor de muncă, din cauză că a fost supus sau că a refuzat să fie supus hărțuirii morale la locul de muncă.

Se  impune a preciza faptul că, în situația unui caz de hărțuire la locul de muncă, angajații care săvârșesc astfel de fapte, răspund disciplinar, contravențional sau penal putând fi sancționați cu amendă de la 10.000 lei la 15.000 lei, dar și obligați la plata de daune morale.

Pe de altă parte, angajatorul are obligația de a lua orice măsuri necesare în scopul prevenirii și combaterii actelor de hărțuire morală la locul de muncă, inclusiv prin prevederea în regulamentul intern al unității de sancțiuni disciplinare pentru angajații care săvârșesc acte sau fapte de hărțuire morală la locul de muncă, în caz contrar riscând sancțiuni de de la 30.000 lei la 50.000 lei

Este interzisă stabilirea de către angajator, în orice formă, de reguli sau măsuri interne care să oblige, să determine sau să îndemne angajații la săvârșirea de acte sau fapte de hărțuire morală la locul de muncă, așa încât competiția acerbă între angajați stimulată de angajatori trebuie să fie tratată cu mare precauție, în caz contrar acestia riscând amenzi de la 50.000 lei la 200.000 lei, dar și obligarea la plata de daune morale pentru prejudiciul suferit de victimă.

Fiind recunoscută poziția dominantă a angajatorului în raport cu salariatul, victima hărțuirii morale la locul de muncă trebuie să dovedească numai elementele de fapt ale hărțuirii morale, sarcina probei revenind angajatorului, în condițiile legii. Intenția de a prejudicia prin acte sau fapte de hărțuire morală la locul de muncă nici măcar nu trebuie dovedită într-un astfeld e litigiu.

Ori de câte ori va constata săvârșirea unei fapte de hărțuire morală la locul de muncă, instanța de judecată poate, în condițiile legii:

a) să dispună obligarea angajatorului la luarea tuturor măsurilor necesare pentru a stopa orice acte sau fapte de hărțuire morală la locul de muncă cu privire la angajatul în cauză; b) să dispună reintegrarea la locul de muncă a angajatului în cauză; c) să dispună obligarea angajatorului la plata către angajat a unei despăgubiri în cuantum egal cu echivalentul drepturilor salariale de care a fost lipsit; d) să dispună obligarea angajatorului la plata către angajat a unor daune compensatorii și morale; e) să dispună obligarea angajatorului la plata către angajat a sumei necesare pentru consilierea psihologică de care angajatul are nevoie, pentru o perioadă rezonabilă stabilită de către medicul de medicină a muncii; f) să dispună obligarea angajatorului la modificarea evidențelor disciplinare ale angajatului.

Dacă simțiți că sunteți victima oricărei forme de hărțuire la locul de muncă, trimiteți-ne un email pe adresa office@gherghina-law.ro și avocații noștri, împreună cu Asociația pentru Justiție și Combaterea Abuzurilor, vor fi alături de dumneavoastră și vă vor sprijini în demersurile juridice ce se impun, pentru restabilirea ordinii juridice și obținerea cuvenitelor recompense morale.

Acest articol nu reprezinta consultanță juridică și trebuie utilizat doar ca o sursă inițială de informare juridică!

Guide to Force Majeure and Hardship

Since the COVID-19 outbreak was reported, countries around the world have imposed travel bans, quarantine citizens and isolate the infected in an attempt to stop the spread of the new virus.

The full impact of the outbreak globaly and the resulting emergency measures on Romanian and international trade remains to be seen. Many of our clients in Romania have reported severe business and operational disruptions, including termination of contracts, cancelling of events, closures of workplaces, disruptions to supply and distribution channels, shortage of labor and weakened regional demand.

Given the unexpected nature of the outbreak, at Gherghina Law we never give up on our clients...especially on hard times like this.

CHECK OUR COVID 19 LEGAL RESOURCE HUB FOR UPDATES

In order to support our clients efforts to mitigate the damages of this unfortunate global situation, we immediately put in place a special COVID 19 Legal Task Force. Our lawyers and consultants attention has focused, among other tasks, on the prospect that parties to affected commercial contracts may invoke force majeure provisions in those contracts in order to excuse delay or non-performance.

Affected contracts with China

Numerous force majeure claims involving Chinese buyers or suppliers have already been reported in the world media and it seems likely that claims with a wider ambit will follow as the ripple effects of the outbreak spread globally.

Any contract with a specific force majeure clause may be the subject of a claim. Contracts governed by a civil law framework, like the Romanian law, which grants force majeure remedies, whether or not they are written into the contract, may also be the subject of the claim. This includes also the Chinese Law .

Force majeure claims are particularly relevant for contracts with a long-term or ongoing supply mostly and in the following markets:

  • Commodity contracts
  • Supply contracts for textiles, foodstuffs and mechanical equipment;
  • Contracts for electrical equipment and electronic components;
  • Medical equipment manufacturing contracts.

The Chinese government has acted on force majeure specifically, with the quasi-governmental China Council for the Promotion of International Trade (CCPIT) announcing on 30 January that it would offer “force majeure certificates” to help companies deal with disputes with foreign trading partners arising from government control measures. To date, it has been reported that thousands of certificates have been issued purporting to shield Chinese companies against liabilities for non-performance.

WHAT IS FORCE MAJEURE?

Force majeure and "hardship" are exceptions to the basic rule pacta sunt servanda. However, a clear distinction of the meaning of both terms in commercial practice is not always easy. There are indeed borderline cases, which cannot be labelled as falling in one or the other basket exclusively. Practitioners of international arbitration will also agree that there is a great confusion as to the use of these two terms. Even in important international contracts, they are often inserted as synonyms.

Force majeure

As regards force majeure, it is often believed that this term is solely of a contractual nature, so that parties to a contract are free to stipulate that a certain event shall be regarded as force majeure, irrespective of the conditions which have to be met under the applicable law.

This view is for instance reflected in contract stipulations, which can often be found, that a determined event will be recognized as force majeure when a Chamber of Commerce or a similar organization issues a "Force Majeure Certificate ".

In the interpretation of the parties, the presentation of such a certificate will release them from their contractual obligations. They are often subsequently surprised and disappointed to learn, through a decision of an arbitration court, that a Chamber of Commerce or other body can only certify that a specific event has taken place but that the arbitrators are bound to the qualifications of the applicable law.

One of the reasons for this confusion may be that Standard contracts, which are largely based on common law conceptions, are used by parties coming from different legal systems. Such is the case, for instance, of the Conditions of Contract (International) for Works of Civil Engineering Construction of FIDIC which introduce expressions like "excepted risks'; "special risks'; "frustration" which have not always a strict equivalent in continental legal terminology.

The legal elements for the qualification of an event as force majeure (vis maior, act of God, etc.) are essentially the same in most legislations, and court decisions show a universal trend to a comparable restrictive interpretation. These elements are

(i) that the event is of an external nature,

(ii) that it could not be foreseen or prevented and

(iii) that it renders performance of a contractual obligation impossible at all or for a certain time.

Hardship

This cannot be said for the term "hardship" in the meaning of an event that changes the contractual equilibrium between the rights and obligations of the parties in such a dramatic way that performance can become ruinous for one of them or cannot reasonably be expected. Although most legislations have rules to cope with such situations (which roughly fall under the so-called clausula rebus sic stantibus), accepted solutions by national laws as well as court decisions and legal doctrine show a remarkable degree of variation.

Civil and contractual force majeure regimes often differ in practise. Contractual can be, in scope and remedies, either wider or narrower than the more inflexible civil law schemes, depending on the bargaining power of the parties at the time the contract was entered into and how that translated into the drafting of the particular contract.

For example, many contractual Force Majeure provisions will include a list of examples of this kind of events. Generally it will be easier to bring a force majeure claim if the event is listed, although typically the other requirements of the objective test must still be met.

Epidemics are uncommon in modern times, but, recent memory includes SARS, Ebola and various severe flu outbreaks. Epidemics arise frequently enough though that the parties may have specifically included "epidemic" or "pandemic" as listed force majeure events or they may be subsumed within more general terms such as "disease" or "illness". Similarly, emergency measures to address or contain an outbreak may be listed or covered under general terms such as "government action," "government order," "national or regional emergency" or "quarantine."

Chinese law perspective

FM exists as a doctrine under Article 180 of the General Rules on the Civil Law and Articles 117 and 118 of the PRC Contract Law. The regime applies automatically to commercial contracts governed by Chinese law where the contract contains no force majeure provisions.

Test/Causation

There must be a causal link between the force majeure event and the affected party's failure to perform (i.e., the affected party must establish that the force majeure event must have caused the non-performance.)

Requirements for claim

The affected party must notify the counterparty of the force majeure event promptly or in a timely manner stating their claim for an exemption of liability and providing proof of the existence of the Force Majeure event and the impact of the event on the affected party's non-performance.

Where such prompt or timely notice is not given the affected party may become liable for losses suffered by the counterparty which could have been avoided had such notice been given.

For example, until fairly recently, English courts applied a test of unforeseeability to force majeure events and while there is authority that this is no longer the case, other common law courts may still impose such a requirement. Hong Kong and Singapore courts have tended to follow the English courts' approach. Conversely, English courts have found that the affected party must also generally have been "ready, willing and able" to perform the contract but for the Force Majeure event. English courts have also tended to take a dim view of claims that a change in economic or market circumstances affecting the profitability of a contract may be a Force Majeure event.

Certain New York courts have tended to interpret Force Majeure provisions narrowly, reflecting the terms of the agreement and the intent of the parties, though there is also authority that "known practices within the industry" is important, particularly in specialist industries.

On the other hand, long-term supply contracts may provide for more complex scenarios, with some contracts requiring supplies to be made at a later date to maintain total quantities while others effectively cancel the affected supply (leaving the supplier with the headache of a quantity it may be unable to sell in circumstances where prices have fallen).

OUR ADVICE TO CLIENTS

If, whether as buyer or supplier, you have entered into commercial contracts that have or may be affected by the COVID 19 outbreak, we recommend the following actions:

  • We advise our clients to contact their designated lawyer at Gherghina Law and to review each contract carefully, with particular regard to the governing law and Force Majeure provisions, including any time bars or other procedural requirements.
  • We advise our clients to contact our office for a preliminary legal view on whether any Force Majeure provision is "open" or exhaustive in relation to the list of Force Majeure events and whether the COVID 19 outbreak and/or resulting government crisis measures are covered/excluded.
  • We advise our clients to discuss with their dedicated Gherghina Law lawyer if they need to invoke a claim, consider an obligation to mitigate the effect on non-performance and what steps they can take. Starting a mindful dialogue with the counterparty may be an important part of the process and our lawyers are always ready to support you in the negotiation process
  • Consider any potential flow on effects from the invoking of a claim such as termination of the contract.

Aside from your legal position, there are generally going to be several other important matters of concern:

  • For a counterparty who receives a Force Majeure claim they do not think is valid, there is the issue of enforcement of the contract,
  • There are the reputational risks and potential damage to long-term supply relationships with foreign buyers and suppliers. Even where there is no legal basis for Force Majeure relief, parties who receive Force Majeure claims may wish to be flexible about amending or restructuring (e.g. by postponing deliveries) the contract to accommodate the affected party.
  • Declaring Force Majeure or receiving a Force Majeure claim may impact on insurance arrangements.
  • Buyers who are part of a chain of supply contracts may themselves need to declare Force Majuere in response to a supplier's declaration in order to avoid being in breach. Each contract in the chain may of course be on different terms or subject to entirely different governing laws and this can create substantial challenges for the buyer, especially where their downstream contract has less favourable (or no) Force Mîjeure provisions.

Clearly if you are entering into new contracts during this period you should consider the Force Majeure provisions with particular care.

Conclusion

With the full impact of the coronavirus likely to play out for some months yet and the potential for the outbreak to spread evan more in Romania, this is an issue seemingly becoming more important by the week.

If you would like to discuss any of the issues raised in this alert please contact us at office@firmadeavocatura.ro

How our lawyers can help?

Delayed or aborted transactions, disrupted or delayed supply chains, sharp decreases in corporate earnings, concerns over commercial viability of your contracts, major event cancellations and decreased consumer activity are all playing a part in the disruption of markets and businesses around Romania due to the COVID-19 pandemic.

We organised a task force of the most capable lawyers of our firm and we monitor the legal implications of coronavirus. We have used our regulatory capabilities and industry sector understanding to produce a range of practical guidance, delivered through client updates. We are in process of preparing a series of webinars.

Due to CIVID 19 epidemy we consider that some of the immediate implications on businesses across industries include:

  • The impact on employment relationships from both health & safety and employee relationship management perspectives.
  • Planning and deploying crisis response plans.
  • Understanding the potential use of force majeure clauses.
  • Challenges within contracts, supply chains and M&A or joint venture transactions, including frustration, MACs and breach of representation/warranty.
  • Increased risk of cybersecurity threats and corporations breaking data privacy rules.
  • Insurance coverage queries, including liability insurance, business interruption insurance and scenarios such as event cancellation.

Gherghina Law Team can help you respond to any challenges impacting you, across your business. Get in touch with us at office@firmadeavocatiura.ro or speak to your usual Gherghina Law contact.

The new reality…China is a 2 trillion dollars global investor

Article published by the Legal Magazine, 13th of April 2019

China's great investment potential drove Ms. Gherghina Oana Ruxandra, Managing Partner of Gherghina Law Firm , to conduct an analysis of the investment sectors, global transactions, and China's investment trends for 2019. The results of the study confirm that China's opening to foreign direct investment FDI comes in the global context in which Chinese companies continue to seek access to new markets and, implicitly, to new opportunities to obtain profits from financial investment by implementing the strategy "Going Global" in Beijing.

Romanian Prime Minister Viorica Dăncilă had a meeting with Chinese Prime Minister Li Keqiang on Friday, in which she stated her interest in involving Chinese companies in public-private partnership projects.

According to a government press-release, "Prime Minister Viorica Dăncilă has provided information on the recent changes to the public-private partnership legislation and has stated the interest in involving Chinese companies in PPP projects."

Investments outside the country offer China the opportunity to consolidate its own economy but also to exert its economic power to increase its influence abroad, and Romania can take advantage of this strategy to increase the volume of foreign investment in our country.

Boosted by Beijing's "Going Global" strategy, which encourages investment in foreign markets, Chinese companies have actively expanded their global footprint in recent years and explored investment opportunities in several sectors such as energy, health and construction . The value of investments and constructions belonging to Chinese companies abroad since 2005 has soared to 2 trillion dollars, according to the American Enterprise Institute .

By analyzing the global context of Chinese companies' interaction, we have come to the conclusion that flexible, interculturaly orriented and imaginative organizations that apply fair and transparent strategies will have the greatest success in conducting FDI transactions with China.Whether we are talking about PPP, M & A, or joint ventures, Romania needs to take this opportunity . "  Gherghina Oana

China's slowdown in economic growth and the tightening of regulation both inside and outside the country have changed the global environment for Chinese foreign investment. To help customers make the right decisions in this evolving environment, Ms. Av. Gherghina Oana, conducted a study targeting the latest trends in Chinese foreign direct investment.

China comes out shopping around the world in 2019

As a result of the research, public information revealed that in the last five years the volume of transactions was generally stable in Europe, but in 2017 in the US they declined by 20% compared to 2014 levels, slightly recovering in 2018. 
The average business size has fallen in both regions, namely in Europe from $ 512 million in 2017 (oversized by the ChemChina-Syngenta hyperdeal) to $ 130 million in 2018, and in the US from $ 207 million in 2017, to just 44 million in 2018. In conclusion, total investment in the two regions fell from $ 111 billion in 2017 to $ 30 billion in 2018. Similar low levels were last recorded in 2013 and 2014.

It is noticed that Chinese foreign direct investment in Europe has far outstripped US investment in 2018. As compared to 2017, US flows have experienced another sharp decline, while Europe has declined more modestly but still significantly. Analyzing the causes of declining Chinese investment in the US, it was concluded that the downward trend in investment was generated by a cumulus of factors such as the continued tightening of Chinese regulatory control over foreign capital flows, the change in US foreign investment policy direct trade in China, as well as a deterioration in economic relations between the two countries.

With regard to Europe, $ 43 billion of ChemChina-Syngenta's hypermarket exploded in the 2017 chart, which could make the results of 2018 seem disastrous, but excluding this transaction, the FID drop in Europe is minimal, the trend towards USA being ascendant.

Massive asset sales?

In addition to limiting investments abroad, tightening Chinese financial conditions has prompted significant Chinese asset sales in 2018. Chinese companies sold assets of 13 billion US assets and 5 billion in Europe. Chinese companies also announced last year sales of $ 12 billion in Europe and the US, sales to be completed in 2019. Being well-known China's investment interest in advanced technologies, it was noticed that asset sales focused on real estate, hospitality (hotels, restaurants, etc.) and entertainment.

The structure of China's FDI sector varied between Europe and North America in 2018, largely due to two influences, the various political and regulatory paintings in the two regions, and the Chinese restrictions on certain investments that mainly affected flows in North America .

The most important direct investment sectors in China in 2018

Chinese direct investment in Europe focused on the automotive industry - 17%, Financial and business services - 15% 
IT - 14%, and in the US - 38%, Health and Biotechnology - 19%, Entertainment, Media and Education - 12%

From the data analyzed, it has been concluded that cinese investments have increased significantly in several Western European countries last year, including France, Sweden, Luxembourg, Denmark and Spain, but also several economies in Central and Eastern Europe - Hungary, Croatia, Poland and Slovenia, Greenfield's investments in production and renewable energy being a key factor.

Trends for 2019

An overview of the transaction market for 2019 suggests a very different picture for China's direct investment between Europe and North America, with Europe currently running over $ 20 billion in ongoing transactions, highlighting - there is a robust appetite for investment in the region among Chinese organizations.

Regarding regulation, regional prospects are more coherent. The legislative climate both in the US and in Europe poses significant risks and uncertainties to Chinese investors, and this situation can be exploited by Romania. The new US investment analysis legislation, FIRRMA, has created an unpredictable context for foreign investment.

While remaining open to Chinese investment, European countries also revise their investment analysis approaches.In this context, Chinese investors could be particularly affected by these legislative changes, which allow governments to control their investment in government funding or policy, focusing on countries with greater openness to foreign investment, as is Romania.

Lack of concern for BREXIT. Truth or Dare?

 In light of the political uncertainty in United Kingdom, the Romanian Parliament should adopt laws addressing the basic issues that will ensue in the event the UK leaves the EU without a deal.

 Is important to remind our Parliament that under a "no-deal Brexit", EU law will cease to apply to the United Kingdom on the day the UK leaves the EU and for Member States the UK will become a third country. 

 In response to that situation, acts regulating the following issues should be immediately addopted:

• British citizens' right of residence; 

• posting of UK workers to Romania 

• the ability of British citizens to and work and carry on economic activity in 

the Romania

• recognition of professional qualifications gained in the United Kingdom; and 

• the conduct of economic activity in Romania by British financial institutions. 

 Rights of residence of British citizens in Romania

The issue of short-term residence of British citizens in EU Member States will be regulated at the EU level. It is planned that British citizens will be exempt from visa requirements when travelling to Schengen countries if staying for no longer than a total of 90 days in any 180-day period, but Romania is not a Schengen country.

Generally, however, from the date the UK leaves the EU, British citizens will lose those rights derived from the freedoms available to citizens of EU member states. The legislation to be addopted should be aimed at preventing a situation where British citizens and their family members would be treated as foreigners living in Romania illegally. 

Under the future legislation, is advisable that the residence in Romania of a British citizen and his/her family members who, on the basis of freedom of movement in the EU, shouldl be considered legal at least until the end of 2020. The aim of this "interim period" is to enable British citizens and their family members to file applications for temporary or permanent residence permits.

The National Bank of Romania ("NBR") issued a press release on 12 February 2019 in respect to a potential no-deal Brexit impact on the banking, payment and electronic money issuance services in Romania, stating that the UK entities providing banking and payment services as well as electronic money issuance services in Romania, either directly or through their branches, will no longer benefit from the single EU passport regime, and will be treated as third-country entities.

Without a license from the NBR, the activity of the Romanian branches of the UK entities, and the direct provision of services in Romania by these entities, will cease as of the date of UK's withdrawal.

NBR advised the users of services provided by these entities in Romania to contact the relevant service providers to check if they have a strategy for avoiding disruptions in the relationships with customers and ensuring the service continuity, or terminating the contractual relationships, as the case may be. 

Is Compliance an issue for your company in Romania?

In the past year Romania has witnessed a number of important developments in the area of compliance and financial crime which will have a significant impact on the risk exposure of companies operating in Romania for the foreseeable future. These developments include the adoption of new laws and regulations that are in line with European and international best practice, a strengthening of the enforcement authority and resources available to regulators to pursue violators and to impose penalties and sanctions, and enhanced cooperation between Romanian and European law enforcement bodies to protect the integrity of the EU financial system from money laundering and terrorist financing.

Compliance now needs to be on the agenda of boards and management teams, and strategic business decisions - whether they relate to the launch of new products or services, acquisitions and other opportunities to expand your business in the Romanian market. The selection of key business partners will need to be undertaken only after a thorough compliance risk assessment is performed. The best companies will reassess their compliance policies and risk exposure in light of the continuous development of EU regulations.

All companies would be well advised to make appropriate adjustments and take corrective actions now to ensure they can continue to operate successfully in the new compliance-focused regulatory environment of the Romanian market.

In order to remind you about possible compliace issues in your organisation please feel free to consider the top 10 key question prepared by Gherghina Law Compliance & Investigation Department:

TOP 10 KEY QUESTIONS

1.Do you have in your organisation a rigorous process in place across all functions to ensure employees are clear on their responsibilities regarding compliance?

2.Does the volume of new regulations in place has made it incredibly difficult to manage risk and remain compliant?

3. Do you fully expect compliance breaches to rise as Romanian regulation becomes more complex and is continuously changing?

4. Are you concerned that the compliance strategies set by the leadership team are not always implemented properly on the chain of command ?

5. Is it possible that a supply chain partner could have a potential compliance risk of which we wouldn’t necessarily be aware of?

6. Are you concerned your organisation is not getting the balance right between compliance and growth?

7. Is the compliance team unit involved in the planning and implementation  stages of strategic growth decisions like M&A, Minority stake investments, Joint ventures, New supply chain partners, New partnerships and New technology/systems?

8. Are there any compliance issues in your organisation that have been discovered by the regulator?

9. Are you concerned about the results of the audit for compliance of the potential acquisitions and investments for your company? 10 Are you aware of any compliance issues in your organisation that are yet to be discovered by the regulator?

If you answerd mostly YES to the 10 questions, you might need to focus on putting in place a robust compliance system to detect possible compliance issues at early stages.

At Gherghina Law we have a specialised Compliance and Investigation Department who can help you implement compliance systems and carry out regular due diligence exercises to determine the company's risk of exposure to internal and external financial crime. Our tem will also train your employees to ensure that these systems and controls are understood and properly and effectively implemented, allowing them to withstand regulatory scrutiny