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December 10, 2022

Loredana Van de Waart, Partner Gruia Dufaut Law Office: Investors are following closely the economic, social, legislative and political development of the countries they target

You represent a law office working mainly with foreign investors. How do you assess their interest in Romania lately?


2015 marked the recovery of the Romanian economy (a record-breaking year for M&A; the biggest number of real-estate deals after 2007, total revenues in the IT sector increased by more than 14%, the macroeconomic figures are among the best in the EU). All of these are found today in the continuously increasing interest of foreign investors in Romania. Of course, this increased interest is also due to the international and regional context: problems on the emerging markets – such as China, Russia, Brazil – determine investors to seek profitable, but more stable markets. Romania is such a country, the second largest market in Eastern Europe and the seventh in the European Union; it still offers many opportunities and our EU membership provides more guarantees in terms of stability than other competitors for similar projects.

However, we noticed that foreign investors changed their behavior compared to the year before the economic crisis: investment and development decisions are taken much more cautiously, after a long period of analyses and studies regarding perspectives and the business, legal and political environment. As for Dutch investors, I noticed an increased interest in the IT, transport and agriculture sectors.


What are the investors’ main concerns when considering an investment in Romania? How does the Law Office intervene in this process?


In light of our Law Office’s experience of over 25 years and my personal experience of over 15 years in relation with investors aiming to do business in Romania or who are already present here and resume their development plans, I consider that investors are following closely the economic, social, legislative and political development of the countries they target. They are particularly sensitive to signals coming from the market, to political and legislative stability, to predictability. Sudden changes in tax or legislation or low security weigh heavily in the assessments investors make. Progress has been made during the last few years, in order to ensure an increased predictability in terms of tax and legislation and to harmonize Romanian legislation with European law and international standards. However, there are still numerous deficiencies in the effective and uniform application of legislation and project management. The lack of infrastructure and poor, sometimes even corrupt management of public projects and EU-funded projects are, in my opinion, one of the biggest problems Romania faces now, which cause the loss of significant investments to the benefit of other EEC countries, such as Poland, Hungary or the Czech Republic. Furthermore, Romania’s image in the Western EU countries, including the Netherlands, is not one of the best… Small and medium enterprises still have a false perception of Romania, Romanians and the rule of law in this country.

Our Law Office provides investors with legal information – and not only – necessary to them to have an overview of the Romanian business environment. In relation to investors, we first try to understand their business and what they intend to develop in Romania, so that we offer them legal solutions tailored to their business. The Romanian legal framework is quite permissive and many of the structures and means of organization used in their countries of origin can be successfully implemented here too. But, in order to do so, there must be a good knowledge of the business and of the opportunities offered by Romanian legislation. The international expertise of our collaborators – all our lawyers are fluent in English and French and are trained in different law systems – represents and advantage in this respect.

On the other hand, we try making investors aware of the “traps” and problems they may encounter in their field of activity, so as to avoid any unknown which usually leads to failure… For example, unlike the Netherlands, in Romania it is necessary to pay a greater attention to written contracts, as gentlemen’s agreements are not so frequently used and respected… We have a saying in Romania: “Good agreements make good friends”.

We guide companies in this legal maze, so that their investments are secure. The Law Office’s experience on this market, doubled by our cumulative practice in relation to a diverse international clientele (80% of our clients have a foreign capital) offer us an undeniable competitive advantage.


Given that today we celebrate “the Netherlands Day” and that you have a special relationship with this country, could you tell us how Dutch investors see Romania?


My closeness to the Dutch community in Romania is both personal (my husband is Dutch), and professional, taking into account that our Law Office also represents the interests of several Dutch companies. We have noticed that Dutch investors have a greater propensity towards complying with laws and rules and a greater strictness in terms of tasks, and less understanding and appreciation for the “innovative” Romanian style of going around the law… The Dutch community in Romania is not very numerous, but it is particularly strong in terms of business. Let us not forget that the Netherlands is the main foreign investor in Romania, with a total invested capital of 8.4 billion Euros, according to the official statistics. Early this year, almost 5,000 Dutch-held companies were registered in Romania.


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