EC warns Romania with infringement regarding fiscal and gas supply security issues

The European Commission has requested today Romania to amend its rules on the taxation of income from independent activities of non-resident individuals. The international institution considers that they constitute a restriction to the freedom to provide services and to the free movement of capital in the Internal Market. “Currently, resident individuals deriving comparable income can deduct the business expenses connected to that income. This results in taxing only the net income. However, individuals established in another EU/EEA State and without a permanent establishment in Romania cannot benefit from such a deduction, and are taxed on the gross income obtained from Romania,” Brussels authorities said.

The Commission sees no valid justification for such a heavier taxation of the income of individuals established in another EU/EEA States, and considers it to be discriminatory and to constitute a restriction to the freedom to provide services and to the free movement of capital, as interpreted by the Court of Justice.

EC has therefore asked Romania to amend its rules in order to comply with EU law. The request takes the form of a reasoned opinion. In the absence of a satisfactory response within two months, the Commission may refer the matter to the Court of Justice of the European Union.

On the other hand, the Commission has formally requested Romania to ensure full compliance with EU rules on security of gas supply. The EU Security of Gas Supply Regulation aims to ensure that Member States are well prepared to deal with possible supply disruptions. To this end, Member States have to enable bi-directional gas flow across borders and prepare emergency and preventive action plans in advance. The European Commission sent today a reasoned opinion to Romania.

„To date Romania has failed to notify to the Commission the adoption of a Preventive Action Plan and an Emergency Plan as requested under the Security if Gas Supply Regulation. Neither has it informed the Commission about its decisions on bi-directional gas flows. Respective authorities in the Member States had to adopt Preventive Action Plans and Emergency Plans already by 3 December 2012. The decisions on bi-directional gas flow had to be taken by 3 September 2012. Romania has to two months to comply with its obligations as otherwise the Commission may decide to refer the case to the Court of Justice” the international institution said.

Romania has interconnection gas pipelines systems with EU neighboring countries, but they do not work at optimal parameters required by EC said for HotNews.ro, governmental agent at the Court of Justice of the European Union (CJEU) Razvan Horatiu Radu, who was surprised by the speed with which the EU executive has advanced in country sanctioning procedure for failure on bi-directional gas flows.

bi-directional gas flowCJEUdisruptionsECEmergency PlanEU Securitygas supplyindependent activitiesinterconnectionnet income discriminationnon-resident individualsPreventive Action PlanRomaniataxation
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