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  • Tax & Legal Flash no. 10
Article:

Tax & Legal Flash no. 10

01 April 2020

The implementation rules of April 2nd, 2020 for the application of the provisions of the Government Emergency Ordinance („GEO”) no. 37/2020 regarding the granting of facilities for loans granted by credit institutions and non-bank financial institutions to certain categories of borrowers; adopted by Government Decision no. 270/2020

The application norm of GEO no. 37/2020 regulates the following:

  • the period for granting the facilities of suspending the payment of mortgage loan rates is established according to the option of the debtor, which can be expressed only once, and is between one and 9 months, without exceeding the date of December 31, 2020
  • the creditor responds to the request of the debtor within 15 days from the date of its receipt
  • the creditor approves the requests of:
    1. debtors that are natural persons who, according to the GEO no. 37/2020, declare on their own liability that it was not possible to honor the payment obligations related to the credit as a result of the intervention of one / more of the following causes, but not limited to: the entry of the debtor / members of his family into technical unemployment as an effect of closing / restriction of the activity of the employer, termination of the debtor’s labor agreement or those of members of his family, reduction of the debtor’s salary or that of members of his family, placement of the debtor in institutionalized quarantine or isolation at home, illness with COVID-19 and so on;
    2. debtors that are authorized natural persons, individual enterprises and family businesses, as well as debtors who hold liberal professions and professions that are exercised on the basis of special laws, who, in accordance with the provisions of GEO no. 37/2020, declare on their own liability that the activity has been totally or partially interrupted as a result of the decisions issued by the competent public authorities according to the law, during the state of emergency declared, with the following consequences: contraction of the marketplace, the reduction of the number of employees, decrease in the number of suppliers and so on;
    3. other debtors if they hold the certificate of emergency situations issued by the Ministry of Economy, Energy and Business, or the certificate for emergency situations issued by the Ministry of Economy, Energy and Business that shows the decrease of its revenues or income by a minimum of 25% in March 2020 compared to the average of January and February 2020 or their activity was partially or totally interrupted as a result of the decisions issued by the competent public authorities during the state of emergency declared, with the following consequences: the contraction of the marketplace, the reduction of the number of employees, the decrease of the number of suppliers and so on;
  • in the case of loans granted under the "First home" program, the maximum duration of the loan of 30 years may be extended by a period equal to the duration of the suspension of payment of the rates granted under the provisions of the Government Emergency Ordinance no. 37/2020, with creditors obligated to respect the internal regulations regarding the classification of the debtors within the age limit at the end of the extended contract;
  • the granting and carrying out, in favor of the creditors, of the state guarantee is made on the basis of a guarantee agreement concluded between the FNGCIMM and the creditors. The receivables arising from the payment of the state guarantees granted, respectively the amounts paid to the creditors based on the letters of guarantee granted by the FNGCIMM, are budgetary debts and will be recovered by the competent fiscal bodies.