Romania: The Prevention Law – No More Fines For Many Misdemeanours

Last Updated: 24 April 2018
Article by Teodora Stoian

On 17 January 2017, the so-called Prevention Law1 came into force. It aims to correct unlawful behaviour by individuals and companies, without imposing fines.

Background

The Prevention Law was announced as one of the main instruments for the state to enforce its prevention policy for the business sector. Its main purpose is to regulate a series of instruments to ensure the prevention of offences.

Now, if an offender has committed certain misdemeanours discovered during an inspection by the competent authority, it will no longer have to pay a fine.

Content

The Prevention Law states the main procedure to be applied by public authorities with control duties, to prevent the offender from committing similar offences in the future.

The law is completed by a new Decision2 which contains a sample of a report to ascertain misdemeanours and the remedies to be imposed by the authorities.

The Decision states the relevant misdemeanours, which are contained in 70 laws and government decisions. The domains covered are very diverse, ranging across social dialogue law, transfer of undertakings law, unemployment law, copyright law, trade registry law, insolvency law, public education law, etc.

Main conponents

The Prevention Law has three main components:

1. Raising awareness – better public information

Within a maximum of three months from enforcement of the Prevention Law (by 17 April 2018), the public authorities with control duties must produce detailed manuals and guides to the following: applicable misdemeanour legislation, rights and obligations of the offender under a state inspection, rights and obligations of the inspectors for a state control, and the specific sanctions that can be applied by the state control.

Within six months after the Prevention Law comes into force (17 July 2018), the central public administration authority with responsibilities for private business must put into place an internet portal offering online services and resources needed for effective public information.

2. Interpretation obligation

Within their areas of competence, the public authorities with control duties must provide guidance to any interested person to help them apply the legal provisions to a correct and uniform standard.

3. Implementation of remediation plans and NO fines

During an inspection, if the authority identifies a relevant misdemeanour, it must apply a warning and set up a remediation plan without imposing a fine.

It is worth noting that Romanian law does not expressly demand written warnings for all misdemeanours. The Prevention Law introduces this possibility even where the special law does not provide for such a warning.

In some cases, however, even the warning may not be essential – only the imposition of a remedial plan.

The same rules apply in the case that inspectors find more than one misdemeanour committed by the same person or company: even in this case, no fine will be imposed, and the offender will receive only a warning and a remedial plan (assuming the offences are mentioned in the new Government Decision).

If inspectors do not comply with the Prevention Law and impose a fine, the misdemeanour report will be null and void, and the addressee may contest it in court.

Another important aspect regulated by this law is the repetition of offences. If the offender repeats a misdemeanour within three years of receiving the misdemeanour report and remedial plan, then the control authority will apply any of the sanctions usually provided by law. This term will be verified according to entries registered in each company's unique control registry (registrul unic de control).

Conclusion

The Prevention Law is, in principle, a positive measure, adopted by the Parliament with a view to encouraging private businesses to observe the law without paying large fines. We hope it will not lead to any increase in offending. In any case, we expect its implementation to be difficult, as the Romanian authorities are not used to offering guidelines and advice to private companies, but rather to imposing fines. Nevertheless we expect that its implementation will change the authorities' sanctioning policy.

Footnotes

1 Law no. 270/2017 regarding the prevention

2 Government Decision no.33/2018, published in the Official Gazette and enforcedon 5th February 2018

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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