ROMANIA Law and Practice Contributed by: Luiza Ionescu, Andreea Paraschiv, Amanda Csaki and Cezara Mitea, Stratulat Albulescu Attorneys at Law
3.2 Tax Consequences In Romania, qualifying spin-offs are exempt from taxa- tion for both the participating entity and its sharehold- ers, provided that the transaction is not primarily tax- motivated. Comparable rules on tax neutrality apply to cross-border spinoffs involving companies estab- lished within the European Union. The Romanian Fis- cal Code sets out the tax treatment of spin-off opera- tions in order to reach corporate tax income neutrality. Other requirements for a tax-free spin-off are that: • the transfer of assets and liabilities is performed at their tax values; and • the shareholders receive a pro rata allocation of shares in the recipient companies, and may also receive a cash payment of up to 10% of the nomi- nal or accounting par value of the shares. In the case of partial spin-offs, the transferred busi- ness must constitute an independent division capable of operating on its own to meet the requirements pro- vided by the Romanian Fiscal Code. 3.3 Spin-Off Followed by a Business Combination Romanian legislation does not impose any restrictions on carrying out a spin-off immediately followed by a business combination. While the sequence is permit- ted under the corporate law, key requirements must be taken into consideration, such as operational, legal formalities and conditions for tax efficiency, as fol- lows: (i) compliance with the Romanian Companies’ Law; (ii) standard requirements for fiscal neutrality, as mentioned in 3.2 Tax Consequences ; and (iii) opera- tional considerations (including timing), as companies must ensure that the spun-off entity is operationally independent so that assets are properly transferred to avoid risks post-combination. 3.4 Timing and Tax Authority Ruling A typical spin-off in Romania usually involves a two- step legal procedure, which can take approximately four months to six months due to the required formali- ties with the Romanian Trade Registry. No tax ruling is required prior to completing a spin-off.
Financing follows this structural logic: rather than rely- ing on classical venture capital, projects are funded through structured or institutional capital, reflecting their asset-heavy nature. Recent regulatory measures have professionalised market entry by introducing financial guarantees for grid connection. As a result, speculative development has largely disappeared, consolidating the sector around well-capitalised developers and institutional investors. 2.2 Liquidity Events Liquidity in Romania’s energy venture ecosystem follows a well-defined “develop-to-sell” model. The typical exit for an SPV is an M&A transaction, with valuation driven by development maturity and key de-risking milestones. Due diligence is decisive: from inception, founders must structure SPV governance and documentation to enable a clean sale – minimal legacy liabilities, assignable contracts, and a transpar- ent data room. Public listings remain exceptional. The Bucharest Stock Exchange (BVB) primarily serves mature hold- ing companies aggregating operational energy or infrastructure portfolios, rather than early-stage pro- ject vehicles. Spin-off operations are a common practice in Roma- nia as they represent an effective tool for corporate restructuring, offering advantages such as flexibil- ity in asset reallocation, tax efficiency, and business continuity. Recent amendments to the Company Law have further simplified the procedure, making it less bureaucratic and faster. In the E&I sector, over the past few years, a growing number of state-owned and private energy companies have used spin-off structures to separate generation, supply, and infrastructure activities, to improve financ- ing, regulatory compliance, or prepare assets for par- tial or full privatisation or sale. 3. Spin-Offs 3.1 Trends: Spin-Offs
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