Recently, the Romanian Minister of Public Finance released Order no. 1939/2016 regulating the main reporting requirements of financial institutions (“Order 1939”). Order 1939 ensures the joint application of three related pieces of regulation - the Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information, ratified by Romanian Law no. 70/2016; the Agreement between the US and Romania to Improve International Tax Compliance and to Implement FATCA, ratified by Romanian Law no. 233/2015; and the Romanian Fiscal Procedure Code.
The main scope of Order 1939 is to:
- Implement the OECD common reporting standard for financial accounts;
- Identify reporting and non-reporting financial institutions;
- Determine which information will be used to identify tax payers whose financial information must be reported;
- Establish the compliance rules that financial institutions must use to identify the reporting accounts and the procedure to report such information;
- Regulate the administrative norms and procedures in order to ensure the application and observance of the reporting procedures and fiscal compliance rules.
Annex 1 to Order 1939 presents a list of the participant jurisdictions and Annex 2 lists the economic activity codes to be used to determine which account holders are financial institutions and which are passive non-financial foreign entities.
Order 1939 goes into great detail with specific aspects related to the reporting requirements. If you would like additional insight on the application of Order 1939 in Romania, please contact: Roxana Popel or Florentin Giurgea.
