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January 25, 2021

New “First Car” programme in 2016

The Finance Ministry (MFP) proposes the earmarking of a guarantee ceiling of RON 100 M for the First Car programme in 2016, representing the sum left unused from the ceiling earmarked in 2015, and the acceptance of the car scrappage bonus in the account of the 5 per cent down payment needed to obtain financing, according to a draft Government Decision published on the institution’s website.

“For 2015, the ceiling earmarked for the programme that encourages the purchase of new passenger cars stood at RON 350 M. In what concerns the ceiling of issuable guarantees, the proposal for 2016 was RON 100 M, sum left unused from the ceiling earmarked for 2015. The ceiling’s level took into account the evolution of the Programme and the aspects revealed by its implementation, as well as the 2015 ceiling’s low degree of usage,” an MFP communiqué reads.

Moreover, relevant legislation also took into account minimizing the beneficiary’s costs by setting a maximum level for the interest rate related to the loans offered as part of the Programme (ROBOR at 6 months plus a margin of 3 per cent per year at most), and the state guarantee remains at 50 per cent of the financing offered at most.

The programme meant to stimulate the purchasing of new passenger vehicles stipulates that physical persons could buy a single passenger vehicle whose purchasing price should not surpass RON 50,000. The programme encourages the purchase of auto vehicles that are located in the lower price ranges or in the range of less polluting cars with high fuel economy and low fuel consumption.

The beneficiary should be at least 18 years old at the time he asks for the guaranteed loan. Likewise, beneficiaries have to deposit a down payment of at least 5 per cent of the new passenger car’s purchasing price, a down payment that in the new formula could be covered with the help of the car scrappage bonus. In 2015, the car scrappage bonus was set at EUR 1,500. Likewise, the beneficiary commits to insuring the car through a CASCO insurance policy.

According to the MFP, a new passenger car means an auto vehicle defined by Emergency Government no.27/2011, manufactured in or imported into the EU, which meets at least the minimum Euro 5 standard criteria, was purchased from authorized juridical persons and whose purchasing price does not surpass RON 50,000, VAT not included.

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