Romania transposes the EU Public CbCR Directive into national legislation

International Tax Review is part of Legal Benchmarking Limited, 4 Bouverie Street, London, EC4Y 8AX

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Romania transposes the EU Public CbCR Directive into national legislation

Sponsored by

EY_Logo_Beam_STFWC_Horizontal_Large_RGB_OffBlack_Yellow_EN.gif
financial-2860753.jpg

Adrian Rus and Gabriela Bancescu of EY Romania report on the front-running enactment of legislation implementing the EU directive and what it means for MNEs.

The EU Public Country-by-Country Reporting Directive entered into force on December 21 2021 and EU member states have to transpose the directive into national legislation by June 22 2023. The first financial year of reporting will be the year starting on or after June 22 2024 at the latest.

In September 2022, Romania became the first EU member state to publish legislation transposing the EU Public CbCR Directive and to choose to implement the reporting early, as the rules will enter into force on January 1 2023.

The first publication will take place within 12 months from the date of the balance sheet of the first financial year and will need to be made available for five years (first publication will take place no later than December 31 2024, for a financial year that ends on December 31 2023).

Requirements for MNEs

The Romanian legislation requires Romanian-based multinational enterprises (MNEs) and non-EU-based MNEs (doing business in Romania through a qualifying branch or medium-sized or large subsidiary) with total consolidated revenue of more than €747,474,740 in each of the previous two financial years to disclose publicly information including:

  • The nature of activities;

  • Income taxes paid;

  • A breakdown of profits;

  • Revenues; and

  • Employees per country.

The report should be made accessible on the public registry of the relevant member state and on the company website free of charge for a minimum of five consecutive years or on the website of the local chamber of commerce (if made available free of charge).

In general, the rules under the Romanian legislation adhere to the general rules in the EU Public CbCR Directive. However, the wording of the Romanian legislation provides for an expansion of the scope as compared with the directive, as MNE groups that have a medium-sized or large subsidiary in Romania are subject to public CbCR in Romania, irrespective of whether these are non-EU or EU-headquartered groups. It is nevertheless expected that this expanded scope will be revised through an update of the legislation, though the timing of such revision is unknown.

In addition, Romania chose to allow in-scope groups to defer the disclosure of commercially sensitive information for up to five years subject to certain conditions, though any omission, together with a duly reasoned explanation, will be clearly indicated in the report. Sensitive information should be understood as information that, if made publicly available, would be seriously prejudicial to the commercial position of the MNE to which the report relates. Nevertheless, information for tax jurisdictions listed on the EU list of non-cooperative jurisdictions may not be omitted.

Furthermore, Romania opted to exempt companies from the requirement to publish the CbC reports on their website, provided that they are made available free of charge on the website of the relevant chamber of commerce.

The information in the report needs to be disclosed separately for all EU member states and all jurisdictions included in Annex I and Annex II of the Council conclusions on the EU list of non-cooperative jurisdictions for tax purposes. For all other jurisdictions, aggregated data is to be disclosed.

Early impact assessment

In the absence at this stage of detailed norms for the application of the Romanian public CbCR legislation, several questions are raised and potential difficulties may be encountered by those impacted by the legislation.

Nevertheless, the acceleration of the public CbCR obligations through the enacted legislative changes in Romania requires that MNEs with significant operations in Romania address and assess early the impact of the Romanian legislation on their business and on their broader public tax reporting strategy.

more across site & shared bottom lb ros

More from across our site

E-invoicing is currently characterised by dynamism, with fragmentation acting as a key catalyst for increasing interoperability, says Aida Cavalera of the International Observatory on eInvoicing
Pillar two and the US tax system ‘could work in harmony’, Scott Levine tells ITR in an exclusive interview to mark his arrival at Baker McKenzie
Peter White, who has a tax debt of A$2 million, has been banned for five years from seeking registration with Australia’s Tax Practitioners Board (TPB)
Wopke Hoekstra’s comments followed US measures aimed against ‘unfair foreign taxes’; in other news, Grant Thornton and Holland & Knight made key tax partner hires
An Administrative Review Tribunal ruling last month in Australia v Alcoa represents a 'concerning trend' for the tax authority, one expert tells ITR
A recent decision underlines that Indian courts are more willing to look beyond just legal compliance and examine whether foreign investment structures have real business substance
Following his Liberal Party’s election victory, one source expects Mark Carney to follow the international consensus on pillar two, as experts assess the new administration
A German economics professor was reportedly ‘irritated’ by how the Finnish ministry of finance used his data
Countries that care about the fair taxation of tech multinationals and equitable global distribution of wealth should back the UN’s tax framework, writes economist Abdelmalek Riad
The cuts disproportionately affected staff in certain positions, the report also found; in other news, MHA announced the €24m acquisition of Baker Tilly South East Europe
Gift this article