Legal Flash no. 127

Changes regarding the foreign direct investment (FDI) regime
The foreign direct investment regime in Romania has undergone amendments introduced by Government Emergency Ordinance (GEO) No. 46/2022 and the related regulation under GEO No. 17/2026.
GEO No. 46/2022 concerns investment screening from a national security perspective, rather than from a competition law perspective. We reiterate the following:
  • concept of investment: an investment must aim to establish or maintain lasting and direct links between the investor and the undertaking to which the investment is directed (e.g., acquisition of shareholdings in companies regardless of percentage, acquisitions involving a change of control, etc.); as such, the regulation applies to a broad range of investments;
  • scope of application: the regulation applies to investors from non-EU states (foreign investors), investors from EU Member States, and Romanian investors;
  • prior notification: implementation of the contemplated transaction without CEISD approval is prohibited; in case of non-compliance, the foreign investor / EU investor / Romanian investor may be subject to administrative fines; agreements through which an investment is carried out are null and void if the investment has not been subject to authorization under GEO No. 46/2022 and the applicable EU regulations.
Below are the main amendments:
  1. Expansion of the scope of transactions covered
The scope of the regulation has been expanded to include the acquisition of tangible and/or intangible assets (asset deals) in sensitive sectors for the purpose of carrying out an economic activity, namely:
  1. Critical and advanced technologies, including but not limited to artificial intelligence, robotics, semiconductors and electronic components, cybersecurity, aerospace technologies, energy storage technologies, etc.;
  2. Critical infrastructure, including infrastructure in the energy, transport, water, health, communications, data processing or storage sectors, aerospace infrastructure, defense infrastructure, electoral or financial infrastructure, sensitive installations, as well as land and real estate essential for the use of such infrastructure;
  3. Pharmaceutical sector, including research, development, manufacturing, distribution and supply of medicines, medical devices and active substances;
  4. Defense sector and defense industry, including the production, development, maintenance, repair, integration, testing or supply of equipment, technologies, systems, components, subassemblies and services intended for or used for military or dual-use purposes;
  5. Agri-food sector, including but not limited to domestic production and processing facilities, agricultural land, irrigation infrastructure, silos and storage facilities, fertilizer production technologies, etc.
 
  1. Change in notification threshold. The investment value threshold triggering the obligation to notify has been increased from EUR 2,000,000 to EUR 5,000,000.
 
  1. Rules applicable to successive transactions
 
  • If two or more transactions are carried out within a period of one year between the same persons or undertakings in relation to the same company, with a similar or interdependent object, the investor may submit a single authorization request covering all of them;
  • If, within a period of one year, two or more interdependent operations are carried out by the same natural and/or legal person(s) or take place between the same natural and/or legal person(s), they are considered a single investment if the value of each individual operation is below the EUR 5 million threshold. The obligation to file an authorization request arises when the cumulative value of the operations reaches the threshold.
 
  1. Exemption for intra-group transactions
According to the amendments, intra-group restructuring operations involving entities from the European Union or OECD member states, such as the United States, the United Kingdom or Switzerland, are not subject to notification.
The exemption applies if two cumulative conditions are met:
  1. the transaction does not result in a change of effective control or beneficial ownership; and
  2. financing comes exclusively from intra-group sources or from jurisdictions within the European Union or OECD member states.
However, a company established in the EU but controlled by an entity from a non-EU jurisdiction may still fall within the notification obligation, including in the case of intra-group reorganizations