Romania

Around 30,000 Romanian companies entered insolvency last year, up 10 percent on 2012. Over a third of the newly insolvent ones were retail companies, according to Trade Registry data, Romania-Insider.com reported. December saw the start of insolvency procedures for 2,400 companies, down on 3,500 in November and 3,300 in October. Most insolvencies were recorded in Bucharest – 3,700, up 5.4 percent on 2012 – and Bihor, with 1,800 insolvencies, a 40 percent growth on 2012. The smallest number of insolvencies was recorded in Calarasi – only 217 cases, and Olt – 244 cases.

Investors interested in buying Romanian state-owned, indebted chemical plant Oltchim have until Jan. 31 to file binding offers, a consortium of court-appointed managers for the firm said yesterday, Reuters reported. Oltchim was forced to file for insolvency at the start of this year. Court-appointed managers then restructured the firm and now aim to pick a winning bid for the remaining viable parts of Oltchim on Feb. 3, they said in a statement.

The new insolvency code, in Romania, due to come into force on October 25 puts in place fresh provisions reducing a company’s chances of exiting insolvency, claimed experts during the first Legal Updates event organized by Business Review last week, Balkans.com reported. Special provisions regarding M&A deals and public procurement were discussed during a series of specialized workshops, chaired by expert speakers. The new code, which was passed through government emergency ordinance no.

A Romanian court has approved the insolvency request for construction company Alpine and appointed Casa de Insolvență Transilvania as judiciary administrator, Romania-Insider.com reported. The Romanian subsidiary of Austrian Alpine Bau Gmbh became insolvent after its parent company declared bankruptcy. It has also been affected by a drop in the construction sector on the Romanian market. In June 2013, Alpine Bau Gmbh, with a EUR 2.5 billion debt and a loss of EUR 450 million in 2012, went bankrupt.

If joining the European Union was supposed to lift Romania out of poverty, it has yet to work in Aninoasa, a town of 4,800 people in the mountainous central region of Jiu Valley, Reuters reported. Six years after Romania's accession to the EU, not only is Aninoasa still poor - it has also become the first town in Romania to file for insolvency. Town officials took out a bank loan to fund investment projects, they could not repay it, they fell behind on paying other bills and over the years they got themselves so deep in debt they could not carry on.

Romania's biggest power producer, state-owned Hidroelectrica, is likely to exit insolvency on June 26, a year after it was hit by a drought and a string of loss-making contracts, its manager was quoted as saying on Wednesday, Reuters reported. Hidroelectrica was declared insolvent and underwent restructuring largely because of deals under which it sold the bulk of its output for less than market prices, causing losses of $1.4 billion over six years and prompting an investigation by the European Commission.

Hidroelectrica SA, Romania’s state-owned hydro-power producer and largest energy producer in the country will exit the insolvency procedure on July 1 this year, according to the Minister Delegate for Energy, Constantin Niţă, Romania-Insider.com reported. “We will promote professional management as it was done for all the state – owned companies, then we will list 10 percent on the stock exchange. We will set a list of priorities because there are a lot of investments that were started.

All the pieces of legislation concerning insolvency will be brought together into one Insolvency Code, and the Romanian Justice Minister Robert Cazanciuc plans to send the draft law of this code to the Government this summer, Romania-Insider.com reported. Cazanciuc cited the unhappiness in the legal system caused by the need to make decisions based on several laws, and the high number of insolvencies recorded in recent years. When creating the Insolvency Code, the ministry will also debate it with representatives of the business environment, the minister said.

With more than 23,000 companies in Romania having gone under in 2012, the government unveiled plans in April to overhaul to insolvency law in a bid to streamline procedures and track down firms that are going insolvent in a bid to avoid paying their creditors, Balkans.com reported. Romanian PM Victor Ponta said in April that the law needs to be changed in order to support companies that operate in good faith.

Romanian state-owned chemical producer Oltchim will enter insolvency, after the Ramnicu Valcea court approved its request today (January 30). The decision can be further appealed for seven days, Romania-Insider.com reported. The company will be assigned a judiciary administrator to establish the next steps and help it re-organize. “For the time being we are waiting for administrator to talk. The factory is functional, and there’s not a question of protests. We will sit down and talk to the judiciary administrator about what needs to be done.