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News: Local firm Lowe PR has become affiliated to GolinHarris Worldwide. Fred Cook, president and CEO of the international network, says the opening of a Bucharest office is part of its regional strategy »page 6

ROMANIA’S PREMIERE BUSINESS WEEKLY

MARCH 7 - 13, 2011 / VOLUME 16, NUMBER 7

LEGISLATIVE CHANGES CHANGES TO THE LAW IN RELATION TO LABOR AND TAX COULD HAVE A BIG IMPACT ON LOCAL BUSINESS. BR TAKES A LOOK AT THE DETAILS »PAGE 12

ELECTRIC AVENUE Gas-free cars were once the stuff of science fiction. Now you can drive one off the forecourt for little over EUR 30,000. Electric vehicles are said to be quiet, economical and could reduce our reliance on oil. But will Romanian drivers be convinced? Business Review looks at the road ahead for electric cars »page 8-11

LINKS

Boom to bust Could Romtelecom’s takeover of Boom TV be the first of many changes to come on the local TV services market? » pages 17

BALANCE

PLUS High flyer or low-down Cinematters Romanian New Wave joint? BR visits The Loft has been winning crit- restaurant ical acclaim for sev» page 20 eral years. But where is this unflinching We review Oscar-wingenre headed? ning doc Inside Job » page 18-19 » page 20


www.business-review.ro Business Review | March 7 - 13, 2011

NEWS 3

NEWS in brief WEEK in numbers

1.26 million – the number of people now on the state payroll since the restructuring measures started last year

11 percent – the drop in the volume of spending on personal care products on the Romanian market in 2010 compared to 2009

Photo: Laurentiu Obae

IMAGE of the week Winter of discontent continues into spring Education unions gathered last week in Bucharest to protest about their salaries, the extended teaching schedule for teachers with over 25 years of work experience, and other administrative issues. The Federation of Education Unions also announced it was consulting its members about going out on strike in May. Teachers weren’t the only ones voicing their dissatisfaction last week. Over 1,500 retired and laid off military personnel took to the streets to make known their unhappiness with the recalculation of their pensions and the new labor code.

PROPERTY & RETAIL Electroputere Parc announces 80 percent occupancy rate Electroputere Park, the shopping center in Craiova set to open in the fourth quarter of 2011, is 80 percent leased. The EUR 90 million project is being developed by K&S Developments and Auchan, with DTZ Echinox as exclusive leasing agent. Electroputere Park has a total lettable area of 55,000 sqm, 1,900 parking spaces and over 120 stores. So far, lease agreements have been signed with fashion retailers C&A, NewYorker, Takko and Orsay. The retail scheme also gathers footwear and accessories brands such as Bata, Deichmann, Otter and Leonardo and will host electronics and home appliances operators Altex and Domo. The new shopping center will also have a Diverta book shop, Toyplex, and numerous jewelry, accessories and perfumes brands, including Splend'or, B & B Collection, Kendra and

Yves Rocher. On the upper floor, the project has a food and entertainment area, with a cinema and bowling lanes.  The main anchors of Electroputere Parc are: Auchan, with an 11,000-sqm hypermarket; sports chain Decathlon, with 3,500 sqm; Kiabi, a fashion retailer, covering a surface of 1,800 sqm; Leroy Merlin, which sells DIY and gardening products, with 10,000 sqm; and Norauto, an automotive service and supplies firm, with a 1,100-sqm retail area.

Calzedonia to open first local store in April Italian retailer Calzedonia will open its first local store, a 200-sqm outlet on Magheru Boulevard, in April, Cushman & Wakefield, the commercial real estate firm mediating the rental, has announced. The firm has a network of over 1,300 shops in Italy, Austria, Cyprus, Croatia, Greece, Hungary, Lebanon, Mexico, Poland, Portugal, the Russian Federation, Serbia, Slovenia, Spain, Turkey, France, Macedonia, Montenegro, Great Britain and Slovakia. “Currently Magheru

Boulevard is, as in previous years, the most expensive commercial street in Romania. In this area rents for a 200-sqm store can vary between EUR 75 and 90 per month. The occupancy rate continues to remain high at about 90 percent,” said Valentin Manu, high street space retail director and partner at Cushman & Wakefield. Calzedonia is part of a group which includes Tezenis and Intimissimi.

Romanian Debro Holding opens Debenhams store in Budapest Debro Holding, the company that owns the Debenhams franchise for Romania and the Republic of Moldova, will open the brand’s first store in Budapest in the WestEnd City Center mall. The 2100sqm shop will open in April. The company has held the franchise for the past four years, during which time it has opened eight locations in Romania and the Republic of Moldova. According to Bogdan Macarie, CEO of Debro Holding, the firm has invested over EUR 1 million in the Budapest opening. A turnover of EUR 4 million is estimated for

13 billion euros – the total investments made in the local economy last year, according to National Institute for Statistics data the Hungarian market in 2011. Debro Holding owns the franchise rights for Debenhams for 13 countries in the region.

Larix puts EUR 500,000 into rebranding Cluj store Local furniture manufacturer Larix has invested EUR 500,000 in rebranding its store in Cluj-Napoca. The shop brings a new retail concept, under the name of Naturlich, which the company says will be more customer oriented. Larix plans to upgrade all of its local outlets. “We currently have eight stores of our own and 49 other stores are our partners’ in more counties. Over the next five years our target is to have Naturlich shops country-wide, at least one in every county,” said commercial director Victoria Cadar. The rebranding process was handled by BrandTailors. The company was founded in 1992 in Reghin and is owned by Zsolt Bereczki.

Cora opens new hypermarket in Drobeta Turnu Severin Cora Romania will open its sixth hypermarket in Romania on March 18, the retailer has announced. It will be the third in Romania outside Bucharest. A second Cora branch will be opened this year in Arad. Romania Hypermarche, the firm running the Cora chain, previously announced a EUR 100 million investment in its first mall on the local market, in Constanta, under the name of Corall.

Bricostore puts EUR 1 million into refurbishing Baneasa store French DIY retailer Bricostore has announced a EUR 1 million investment in


www.business-review.ro Business Review | March 7 - 13, 2011

4 NEWS

NEWS in brief the refurbishing of its store in Baneasa, Bucharest. Last week the firm opened its 15th local store in Drobeta Turnu Severin. The outlet, which has a surface of 7,500 sqm and 40,000 products, required an investment of EUR 8 million, according to company representatives. The refurbishment of Bricostore Baneasa included reorganizing the store’s departments and increasing the product range with a focus on interior design solutions and more competitive prices. Next year, the firm plans to refurbish its store in Pantelimon and to open a new unit. “Bricostore will continue to develop in all the three countries where it is present, Romania, Croatia and Hungary,” said Philippe Bresson, president of the Bresson Group, which operates the brand. Last year Bricostore Romania saw its turnover fall by 17 percent compared to the RON 754.4 reported in 2009, due to a shrinking market and increased competition, said company representatives quoted by Mediafax newswire. There are 15 Bricostore units in Romania, 9 in Hungary and 2 in Croatia.

LEGAL DealWatch ranks top law firms in Romania

BR EVENT

International Investment Forum Howard Johnson Grand Plaza Hotel March 31, 2011 Romania’s investment potential will be discussed in a five-session event on March 31 at the Howard Johnson Grand Plaza Hotel in Bucharest. The event, which is being organized by Business Review and Beyond Transylvania, will gather local and international speakers, both investors and representatives of local authorities, to debate investment potential areas in Romania, such as tourism and regional development. “The regional airports open up new areas and opportunities for business and leisure. I have visited most of them and seen the development proposals, and some may need to be trimmed back in the current economic climate. However these gateways to the regions have vast potential that is still to be exploited,  at a much lower cost than building roads and faster implementation.  International business people need to be in and out quickly and

tourists want to travel point to point. The regional airports are a key part of providing the answer,” said Howard Scaife, publisher of Beyond Transylvania. Confirmed speakers at the event include Wil van Eijsden, director of AgriCULTURA Transilvania; Mugur Stet, spokesperson of Romania’s Central Bank; Paul Tudor, president of Besta Group; Mircea Mocanu, director of the Socio-Economic Section of UNDP Romania; Petru Stefan Runcan, general manager of Targu Mures international airport; Terry Di Stase, international business director with Snowflex; Tinu Sebesanu, CEO of Trend Hospitality; Christopher Owen Howard, managing director, 4 You Property Partners Ltd; Bogdan Donciu, general manager of Romatsa R.A; and David Ciceo, general manager of Cluj international airport. For more details about the event please visit business-review.ro/brevents

Popovici Nitu & Asociatii has been ranked first for M&A in Romania by the number of deals concluded in 2010, by DealWatch’s M&A League Tables. Their total value reaches EUR 85 million. Last year, Popovici Nitu & Asociatii was involved in 18 successful deals and another 15 joint ventures and corporate restructurings in industries such as energy, healthcare, telecom and real estate. The firm advised Auchan Romania on the acquisition of various real estate properties, Filasa SAS & Sanafi SAS on the acquisition of five wind farms, and Immofinanz in a string of acquisitions, including the acquirement of up to 100 percent equity in the companies owning Polus Constanta Mall, Euromall Galati and West Gate Craiova Mall.It also advised MedLife on the acquisition of 80 percent of the share capital of Medis Brasov and of a local company involved in the development of private hospital and Scop Computers on the sale of 50.96 percent of shares to ABC Data. For number of deals, Popovici Nitu &Asociatii is followed by NNDKP, Biris Goran, Musat & Asociatii and Tuca Zbarcea & Asociatii. However, ranked by deal value the order is different. First place is occupied by Musat & Asociatii, with EUR 584 million, Kinstellar SCA on EUR 182 million, NNDKP with EUR 115 million, Tuca Zabarcea & Asociatii on EUR 88 million and Popovici Nitu & Asociatii and Schonherr, both with EUR 85 million.

TELECOM SMS discount market surpasses EUR 2 mln in 2010 The number of promotional campaigns to which customers sign up via SMS increased 80 percent last year compared to

2009, according to a survey by Voxline Communication, looking into the market of discounts via SMS in 2010. Firms in the food sector were the most active through this channel. “Regarding the SMS traffic that is generated, we estimate that participation in promotions amounted to more than 25 million messages, which represents a growth of nearly 30 percent compared to the volume estimated for 2009, and 10 percent more than the daily national volume of messages (22 million),” said Bogdan Apostol, business development manager at Voxline Communication. Last year 20 percent of the monitored companies carried out promotions with SMS enrollment for the first time, 10 percent up on 2009. 64 percent of the discounts monitored in 2010 used a website to boost sign-up rates, (in 53 percent of cases, a dedicated website) and 7 percent of all the discounts had, apart from SMS and web, another way of joining up (phone call, postal letter).

MACRO Romania’s annual inflation highest in EU Romania posted the highest inflation in the European Union for the sixth consecutive month in January, while the EU average rate was stable at 2.7 percent, according to data from Eurostat. Romania’s annual inflation reached 7 percent in January, followed by Estonia (5.1 percent) and Greece (4.9 percent). The lowest annual rates were reported in Ireland (0.2 percent) and Sweden (1.4 percent). The lowest 12-month averages up to January were in Ireland (-1.4 percent), Latvia (-0.7 percent) and Slovakia (2 percent) and the highest in Romania (6.2 percent), Greece (4.9 percent) and Hungary (4.5 percent). Annual inflation in the Eurozone was 2.3 percent in January, up from 2.2 percent in the previous month.

REGIONAL Construction company Synergy establishes Georgia branch Turkish construction company Synergy has established its Georgia branch and started works at Akhaltsike for the Siemens HVDC technology to transmit eco-friendly electric power from Georgia to Turkey as part of the Black Sea Transmission Network Project, one of the most significant infrastructure projects in Georgia. The company will be the civil partner of Siemens responsible from construction works Phase I. Siemens has won an order to install two turnkey HVDC (high-voltage direct current) back-to-back links in Georgia to connect the Georgian power supply network with the grid system in Turkey. As part of the Black Sea Transmission Network Project, one of the most significant infrastructure projects in Georgia, the two HVDC back-to-back links are each to transmit 350 MW of controlled electric power generated in various hydropower plants in Georgia to Turkey.


www.business-review.ro Business Review | March 7 - 13, 2011

6 NEWS MEDIA

HEALTHCARE

Lowe PR joins up with GolinHarris

New regional ER hospitals will cost EUR 200-300 mln each – MoH

Courtesy of Lowe PR

Fred Cook, president and CEO of GolinHarris Worldwide

L

owe PR has become affiliated to the international network GolinHarris, the company has announced. Discussions started a year and a half ago and the contract of affiliation was signed at the end of last year. The office, the first that GolinHarris has opened in Eastern Europe, will be led by Hortensia Nastase, managing partner. The local Bucharest division will be coordinated by the firm’s London office. “Opening an office in Bucharest brings us closer to our

clients in the European region,” said Fred Cook, president and CEO of GolinHarris Worldwide. This move is part of the company’s strategy to expand its operations across Europe. “We are very determined to grow the business in the region,” said Matt Neale, co-managing director of GolinHarris Europe. “Becoming affiliated to a strong global network was a development target that we have proposed ever since we founded the agency in 2006. The main benefit of this affiliation is the access of our team to global expertise, from which the clients of our agency will benefit,” said Nastase. GolinHarris Bucharest joins the group led by Veronica Savanciuc, which also comprises five specialized agencies: Lowe (creative), Initiative and Brand Connection (media), HyperActive (digital communication) and MedicOne (healthcare communication). The PR agency now has 17 employees and its portfolio of clients includes Electrolux, the Royal Bank of Scotland (RBS), Unilever, Franklin Templeton Investments, Orange, Johnson&Johnson, Schneider Electric Romania, Ferrero, Hasbro, Century 21, La Redoute, Frey Wille, the Romanian Red Cross and the European Commission. ∫ Otilia Haraga

POLL

Romanians remain gloomy, poll finds

S

ome 46 percent of Romanians are satisfied with their lives, only 4 percent believe that their country’s economic situation is good, while 14 percent expect the economy to recover in 2011, according to a Eurobarometer survey published last week, quoted by newswire Mediafax. Ten times more optimistic about their continent than their country, 41 percent of Romanian respondents think the European economic situation is good while 32 percent said the same thing about the world situation. The 46 percent of Romanians who are satisfied with their lives is an improvement on the 36 percent who said the same at the beginning of last year. About 54 percent of urban Romanians and 39 percent of those living in rural areas said they are pleased with their lot. In the EU, 78 percent of respondents described their lives as satisfying, over 30 percentage points higher than the average registered in Romania. In Denmark the level hit 97 percent, and in Sweden and the Netherlands 96 percent. A mere 38 percent of Bulgarians said the same. According to Eurobarometer, in the fall of 2010, 94 percent of Romanians considered the country’s economic situation bad or very bad, compared to 90 percent

at the beginning of last year. About 70 percent of EU citizens said their countries' economic situation was bad. Half of Romanians see rising prices and inflation as their main problems, a third think that the impact of the crisis on the labor market has not yet peaked, while 4 percent expect the job market to worsen in the next 12 months. The majority of Romanians (80 percent) think that the anti-crisis measures taken by the government were ineffective. The survey also revealed that 63 percent of Romanians think the European Union has also been ineffective in fighting the crisis. Almost half of European citizens said the EU’s anti-crisis measures were effective. National governments should be the institutions most capable of taking viable measures against the economic crisis, almost one third of Romanians said, followed by the EU with 27 percent and the G20 states with 12 percent. The survey was conducted on 1,001 Romanians between November 11 and December 1. The national Eurobarometer 74 report was presented by its author, Horia Domnariu, research director with the Center for Market and Opinion Research. The error margin is +/- 3 percent. ∫ Corina Dumitrescu

T

he regional emergency hospitals expected to be built under private-public partnerships will have between 700 and 900 beds and cost EUR 200-300 million each to build, said the health minister, Cseke Attila, quoted by Mediafax. Several requests from private parties looking to build hospitals in Romania have been received, he added. In Bucharest the emergency hospital will be built on the Fundeni platform, next to the hospital church. It will cost over EUR 200 million and will have a 110,986-sqm surface. Authorities estimate that the units will be profitable after two-three years, and the investment will be recovered after five years. Companies interested in such a col-

laboration with the state must have a turnover of at least EUR 5 million and a profit of EUR 500,000 per year. The new hospitals were designed as university centers which will provide emergency medical care, especially in difficult cases. The health minister previously told Mediafax that the ministry planned to build a network of six regional emergency hospitals under PPPs. They will be located in Cluj, Craiova, Iasi, Targu Mures, Timisoara and Bucharest. The entire project is estimated to cost EUR 1.5 billion, and both the financing and the management will be private. “It will be one of the most important investment projects in hospital infrastructure in the last 30 years,” said Attila. ∫ Staff

CONSUMPTION

Consumer expenditure fell 5 percent in 2010

R

omanian household expenditure on consumer goods decreased by 5 percent (in the local currency) in 2010 compared with the previous year, announced GfK Romania. In the first semester, the decline reached 4 percent, but later rose to 6 percent in the second half of 2010, due to the austerity measures, according to the same source. “Trying to adjust to a not at all favorable economic context, consumers reduced the volume of the shopping basket. In 2010, they shopped less often and – at the same time – dropped pampering products,” said Raluca Raschip, consumer goods director at GfK Romania. The worst affected segment was personal care products with a drop of almost 11 percent (in RON). Deodorants (-19 percent), shampoo (-14 percent), and toothpaste and toilet soaps (-12 percent each) reported the most drastic reductions in volume. The beverage segment also slumped in 2010 (-6 percent), with a stronger con-

traction in the second half of the year compared to the same period of the year before (-9 percent as compared to -3 percent in the first six months). Categories that saw sharp falls in volume throughout the year include juice, soda and beer, especially given the decline of consumer households. Basic foods and home care products were the least affected, with dips of 3 and 4 percent respectively. In the food segment, chocolate slabs had a more pronounced decrease (-17%), according to the market research institute In 2010, modern trade attracted 45 percent of household expenditure on consumer goods, 2 percent up on 2009. Both hypermarkets and discounters registered positive growth, each of these formats reporting a one percentage point increase. Supermarkets, on the other hand, lost trade (-8 percent in value compared to 2009), as they were the worst affected by the reduced frequency of shopping trips, says GfK. ∫ Simona Bazavan

TELECOM

Power Net Consulting signs deal with Ministry of Justice

P

ower Net Consulting has signed a four-year contract with the Ministry of Justice. The firm will supply maintenance services for all IT equipment in the ministry, courts of justice and the National Administration of Penitentiaries. In total, it covers approximately 15,000 pieces of equipment, including servers, work stations, laptops and printers, in 250 locations across the country. The value of the contract is RON 18 mil-

lion, according to media reports. “We will have dedicated personnel for this project who will provide on-site checks, support and consultancy. The project will not raise any issues related to difficulty. The only challenge is the large coverage area, due to the client’s high number of institutions and locations,” said Eduard Dimitriev, general manager, Power Net Consulting. ∫ Otilia Haraga


www.business-review.ro Business Review | March 7 - 13, 2011

NEWS / WHO’S 7

WHO’S NEWS

Business Review welcomes information for Who’s News from readers. Submissions may be edited for length and clarity. Get in touch at simona.bazavan@business-review.ro

Giulio Simonelli

Hatice Soysev Kolat

has been appointed GM of Banca Italo Romena by the bank’s board of directors. He is taking over from Antonio Bianchin who was given another position in the Veneto Banca Group. Simonelli began his career in banking in 1986. In 2000 he joined Banca Apulia Group where he held various management positions including GM of Bank Apulia from 20082011. In 2010 Banca Apulia became a member of the Veneto Banca Group.

has stepped down as GM of Kanal D Romania after two terms and four and a half years at the helm of the TV station. She will be replaced by Haluk Kurcer, country manager and executive board member of Dogan Group. Kolat has been in Romania since 2006. She joined the firm in 1997 as manager of the programs and acquisitions department. Three years later she was promoted to deputy general manager of Kanal D Turkey.

Marius Croitoru finance director and SAP implementation director at CocaCola HBC Romania and Moldova, has been promoted to financial director at the firm’s subsidiary in Italy. In July he will relocate to Milan where he will coordinate the financial, legal and acquisitions departments of Coca-Cola HBC Italy. Croitoru previously held a similar position at Coca-Cola HBC Switzerland for almost four years. He joined the company 10 years ago. Croitoru graduated from the ASE in Bucharest and IMD Institute in Lausanne.

Mihai Gabriel Jelea (30) has joined the corporate and insolvency team of Lina & Guia law firm as associate lawyer. He has worked on projects in restructuring, transactions and insolvency. Jelea has previously worked for a Big Four company and another Romanian law firm. He has been a member of the Bucharest Bar since 2006. He holds a master’s degree in European law from Pantheon-Sorbonne.

Alina Mirea will take over as Deloitte‘s audit & assurance director of the Timisoara office. Before joining the company she was a

partner with another consulting firm. Over the years, Mirea has been in charge of international audits and technical advisory mandates. She has experience in International Financial Reporting Standards, Romanian Accounting Standards and USGAAP.

Andrei Mocanu joins More than Pub as project manager and HTML specialist. He has worked in the online field for seven years, four of which in management positions. Mocanu has previously worked for U TV as online manager. He has also worked in journalism.

Corina Stamate has joined More than Pub as project manager in PR. She has worked in advertising and marketing for the past five years. Stamate served as account manager for the past four years.

David Goldsborough has been appointed CEO of Tibbett Logis-

tics. He held the same position at Delamode Logistics from 2005 and 2010. Prior to 2005 he was managing director of Tibbett & Britten Germany for six years having worked in Austria, Hungary and the UK. He graduated from Sheffield University with a degree in International Business and German in 1994 and has an MBA from Henley Management College.

Alexandru Catana has been appointed distribution director of Tibbett Logistics. He has previously developed the transportation and distribution operations for Delamode Logistics.

Doru Carburean is the new finance director on the board of Tibbett Logistics. He previously held the finance manager position at Delamode Logistics between 2008 and 2010. Carburean holds ACCA certification and graduated from Cluj University in 1999 in finance & economics.


www.business-review.ro Business Review | March 7 - 13, 2011

8 FOCUS

gines are very quiet,” Laura Antonov, Citroen Romania marketing director, told Business Review. After the launch of the Citroen C-Zero, Mitsubishi premiered its i-Miev model, which retails at EUR 29,548, excluding VAT. Specialists say the only difference between the two electric models is the logo. Are Romanians lining up to embrace this brave new world of motoring? “No,” says Antonov. “There isn’t yet a firm order on the local market. Reticence towards electric models is fueled by a lack of support or incentives from the state, compared with other European countries where there are plenty of fiscal stimuli meant to boost electric car sales.” In the UK, the government has announced that it is committed to support the development and uptake of ultra low carbon emission vehicles. This means that the state is offering a 25 percent subsidy against the listed price (up to a maximum of GBP 5,000, or about EUR 5,830) on electric cars. It is available to both corporate and individual customers for vehicles registered from January this year.

Further on up the road

Courtesy of Opel

Engine for change: electric cars are said to be both better for the environment and quieter

Gas-free cars electric dreams no longer As fuel prices continue their upwards trajectory, electric cars are moving from the niche realm to the road. Several models have been launched in Romania too, such as the Citroen C-Zero and Mitsubishi i-Miev, but company officials are still awaiting orders. Market specialists blame reticence towards electric models on a lack of incentives from the state, as other European governments are supporting this field. ∫ DANA VERDES At a time when the price of oil is sky-rocketing, seemingly never to come back down, owning a gas-free car is a tempting prospect. World renowned carmakers are competing to launch electric models, either concepts or series versions, or – by

way of a compromise – plug-in hybrids. This new generation of green vehicles includes the Citroen C-Zero, Peugeot iOn, Mitsubishi i-Miev, Nissan Leaf, Opel Ampera and Chevrolet Volt, some of which are available on the local market. “As far as the Citroen brand is concerned, last year we launched our first

electric model, C-Zero, which is available for order in Romania too as of January this year. The C-Zero has a starting price of EUR 36,642, the same price across Europe. The main advantages of such a model are consumption and its positive effect on the environment, but there are also comfort advantages, as electric en-

Specialists say studies indicate that the local gas-free car market could grow from its current niche status to 11-30 percent of the market in 2030. Within five years, the penetration of electric cars on the European market could reach 2-3 percent, and in ten years 5 percent, say market specialists. At EU level, the effects on electricity consumption of passenger transport will be negligible until 2020-2025. Subsequently, they will be significant and the amount of fuel saved could be in the region of 6-20 percent by 2030. According to EU studies, by 2030 energy demand in the road transport sector could go from 140,000 to 550,000 TJ in the EU (1-4 percent of the total electricity consumption forecast). “When we are not breathing exhaust emissions or when we no longer hear engine noise, then we will have seen a real transformation. It will be a milestone in the auto industry. The only solution [for the automotive industry, e.n.] is to go to zero emissions, to develop the electric car,” said Carlos Ghosn, Renault Nissan Alliance president.Worldwide there are currently 600 million vehicles in circulation and by 2050, according to the Renault chief, the figure will rise to 2 billion cars, as purchasing power grows in emerging markets. The Alliance’s medium- and long-term plans include the launch of four to eight electrical models for Nissan and Renault.

Nissan turns over a new Leaf, Opel’s Ampera draws on two power sources Nissan has already started production on its 100 percent electric vehicle, the Leaf. “The model isn’t yet scheduled to be launched in Romania, but in Europe it costs EUR 30,000,” Nissan Romania officials told BR. It comes with new comfort, safety and connectivity technologies. The Leaf is being promoted as a real alternative to family cars with conventional engines, providing comfort for five people, luggage room and high performance and zero emissions. Elsewhere, Opel will launch its gasfree car with expanded autonomy, Ampera, this year, Opel Romania officials told BR. They describe it as a four-seater fam-


www.business-review.ro Business Review | March 7 - 13, 2011

ily car with a generous trunk. According to research, about 80 percent of Europeans drive a maximum of 60 km daily, and the model covers 40 to 80 km in full electric mode. Moreover, the Ampera is also equipped with a petrol tank, which alongside a generator can support, in terms of electricity, up to 500 km of driving. It has the equivalent of 150 HP and reaches a top speed of 161 km/h. Going for EUR 36,050 excluding VAT, the model already has 1,000 reservations in Europe. Also, Renault announced at the Geneva Motor Show that its Twizy model will enter mass production at the end of the year and the price will be EUR 6,900. Compared to the original design, the production model is a 1+1 configuration, with the additional place behind the driver not besides him as usual. Twizy offers 115 km autonomy and a maximum output of 9 HP, enough for the vehicle to reach a speed of 75 km/h.

Electric switches to the mainstream Electric vehicles are not new, but over the last two years they have come into the spotlight as the battery performance has considerably improved in terms of range, reliability and power, while transport decarbonization concerns have become more pressing across the world. Such cars are now becoming a more popular – but not yet widespread – choice for the consumer. Philippe Jean, DG of Enterprise and Industry at the European Commission (EC), says that the arrival of electric vehicles will be a gradual evolution rather than

FOCUS 9 radical change. Current sales of hybrid vehicles worldwide amount to a little below 1 million units – which means 2 percent of global sales – and they are expected to grow to 5.5 percent of the world market. For fully electric vehicles world sales reach some 20,000 units, or 1.8 percent of the market. On the EU market, hybrid vehicles are predicted to grow from 100,000 units today to 1 million in 2020 and fully electric vehicle sales from some 2,000 cars now to 750,000. For the next few years, the purchase price of a hybrid or fully electric car will be several thousand euro higher than the average price of a gas-fuelled vehicle. This difference is largely due to the cost of battery, depreciation and insurance costs. Current studies indicate that the cost of batteries will decline by 6-8 percent annually with improved chemistry and economies of scale. Does this mean that drivers have to wait until 2020 to consider the purchase of an electric vehicle? Not necessarily. First of all, when analyzing the cost motorists should consider the total cost of ownership, which includes the price of fuel. The most recent analyses indicated that the cost of charging a gas-free car will be (on average) around 30 percent of refueling a petrol vehicle. This is not counting the recent spike in the price of oil and its possible impact on gas prices. Another interesting way of reducing the vehicle cost is leasing the battery or battery swap projects. The only problem that remains is the purchase price.

dana.verdes@business-review.ro

THE EU PLAN TO DRIVE FORWARD SALES

To boost consumer acceptance the EC is seeking a harmonized solution for charging electric vehicles. This will give the European consumer confidence that they can charge their electric car in all EU countries. Work has already started – European Standardization Organizations bodies have been tasked with developing a common charging system for electric cars, scooters and bicycles and are expected to deliver it this year.

A powerful tool at the disposal of national and regional authorities is purchase incentives and tax rebates for customers. The European Commission recognizes the important role of those incentives and is currently preparing the guidelines for their design and implementation. Importantly, in the years of austerity and fiscal tightening that lie ahead, more innovative solutions for boosting the “consumer pull” should be considered at national or regional level such as: the free parking spaces for electric vehicles, free lanes, access to green zones, free consumption of electricity of vehicles recharging, etc. In the coming years, the establishment of rapid-charging infrastructure will be of vital importance with interesting opportunities to use electric vehicles to store electricity. In this field, the European Commission has just started an electro-mobility demonstration project, which should enable countries like Romania to gather useful experience from several European regions already engaged in electromobility and identify a possible European approach. The EC wishes to play a coordination role and employ the financing tools of Structural Fund and the European Investment Bank.


www.business-review.ro Business Review | March 7 - 13, 2011

10 FOCUS CITROEN C-ZERO

Courtesy of Citroen

The Citroën C-ZERO is a fully-electric vehicle powered by a permanent magnet synchronous motor which delivers 47 kW or 64 bhp EEC from 3,000 to 6,000 rpm. Maximum torque of 180 Nm is available from 2,000 rpm. Power is transmitted to the rear axle via a single-speed reduction gear. The car can be driven in town and on the open road. It is quiet when in use for both passengers and pedestrians,

say company officials. It does not pollute or release carbon dioxide when in motion. The motor is powered by a latestgeneration 330-volt lithium-ion battery system comprising 88 50-Ah cells (for onboard energy of 16 kWh) mounted in the centre of the vehicle. In France, 70 percent of car journeys are made at the weekend over a distance of less than 30 km while 95 percent are less than 80 km.

PEUGEOT iOn

Photo: Thomas Doerfer

The iOn is amongst the first of a new generation of 100 percent electric vehicles being produced by major manufacturers. It has an all-electric drive train, four doors, four seats and a range of up to 93 miles. The iOn is equipped with the latest-generation 330-volt lithium-ion battery system. It can be charged quickly and easily at

home using a normal electricity socket, or at a dedicated fast charging station. It takes around seven hours to fully recharge from a normal 240v mains power supply. If you’re in a rush, a quick 30 minute charge is enough to give you 80 percent capacity thanks to the fast charging system. A full recharge can cost from as little as £1 in the UK.


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FOCUS 11

MITSUBISHI I-MIEV

Courtesy of Mitsubishi

Mitsubishi is currently the electric car market leader in Japan with the iMiEV. It is a compact car with zero emissions. With four seats and a length of only 3.475 meters, it comes with four doors and a trunk of 227 liters. Maximum power from the electric motor is 49 kW and 66 HP and maximum torque is 180 Nm. The maximum speed the i-MiEV

can reach is 130 km/h, with the lithium-ion batteries providing autonomy of up to 150 kilometers. A full charge takes six hours. Currently, the i-MiEV electric car is undergoing safety testing. In the first crash tests carried out by Euro NCAP it got four stars under the new protocol.

OPEL AMPERA

Courtesy of Opel

The Ampera, which was revealed recently at the Geneva Motor Show, has five doors and four seats and is designed to offer all the benefits of an electric vehicle, while eliminating worries about self-generation solely on battery power. So far, according to Opel officials, about 1,000 people have reserved an Ampera in Europe, half of whom are corporate customers. The

extremely quiet electric motor, of 111 kW and 150 HP, generates instantly a torque of 370 Nm. This allows the Ampera to accelerate from 0 to 100 km/h in about nine seconds and reach a top speed of 161 km/h. The battery can be recharged in about four hours at a voltage of 230 V by connecting the integrated loading system to a standard household electrical outlet.

CHEVROLET VOLT

Courtesy of Chevrolet

General Motors (GM) wants to be the plug-in leader with the Chevrolet Volt, a hybrid with 40 miles of electric range and 500 miles per gasoline fill-up

range. Chevrolet will deliver over 10,000 in 2011. The GM has a complete voltec propulsion system roadmap that envisions added offerings of pure battery-electric, E85 and diesel. With a small gasoline engine, Chevy Volt can go for another 300 miles. The car has two 7-inch diagonal LCD touch screens that display speed and battery power, bluetooth wireless technology that can stream music in a phone to a stereo, rear camera and park assist package, with pedestrian-friendly alert. The second plug-in offering from GM is likely to be a Chevrolet Crossover SUV.


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12 LEGISLATIVE CHANGES

Courtesy of gov.ro

The bill for the modification of the amended Labor Code has been sent to Parliament

Labor Code shakeup adds to taxing legislative changes 2011 should be the year when the government comes up with solutions to ease the fiscal burden and create the legislative background for a more competitive economy, or at least these are its intentions. Some of the major legal changes announced so far this year concern labor law. Last week the government approved the bill to modify the amended Labor Code and sent the document to Parliament. Should the bill be passed through a vote of confidence on March 8 as the government plans, Romania will have a new Labor Code that will bring substantial changes to the local labor market. Meanwhile, further changes to tax law leave firms on an adjustment footing.

∫ SIMONA BAZAVAN Discussions over the need to change the Labor Code are not new. The debate started last year with the changes proposed by organizations of foreign investors active in Romania such as the American Chamber of Commerce in Romania (AmCham) and Foreign Investors’ Council (FIC). The Labor Code should foster flexi-

bility in relations between employers and employees as well as stimulate competitiveness, say foreign investors active locally. Enforcing performance as a basic principle of labor relations and clearer and simpler legal provisions are also necessary for Romanian employers, says AmCham. “We believe that the labor market is one of Romania’s competitive advantages and we will continue to support

those principles that ensure that this advantage is kept,” said Mariana Gheorghe, president of FIC and CEO of Rompetrol. Relocation is an option for any company nowadays which is why Romania should consider reforming its labor law to remain attractive to foreign investors, said Sorin Mindrutescu president of AmCham Romania, during an end of year meeting with the media. According to

data from the FIC, a more flexible Labor Code could generate almost 90,000 jobs in the short term. Many of the changes made to the code should be helpful to companies, but there is still room for improvement. “Some of the amendments have been passed because of an insistence that there is more conformity with EU regulations, or because of a perception that there should be improvements for employees, so elements of the changes are more a question of social policy and politics rather that measures to give direct assistance to business,” said Ray Breden, president-elect of the British Romanian Chamber of Commerce. Despite the unions’ strong and very vocal disapproval of the proposed changes, as well as threats of protests and general strikes, the government has expressed its commitment to go ahead with the changes at all costs. While union leaders argue that the amended Labor Code draft will leave the door open to abuses against employees and tougher work conditions, Prime Minister Emil Boc said that the changes are expected to generate more jobs and protection for competent employees. They are also expected to raise more money for the state budget. “We have chosen the version that is the most favorable to the Romanian employee,” said the PM. Opposition parties see things differently and have announced plans to initiate a motion of no confidence against the government.

What’s new? One of the most controversial changes in the amended code is the government’s decision to forbid collective labor contracts after December 31. Also, current collective labor contracts may not be renewed, but will be effective only until they expire. The PM said that collective labor contracts will be regulated through a special law, which will be passed immediately after the code is revised. This is one of the measures that the unions oppose most fiercely, arguing that terms such as working hours, conditions and minimum wage will be abolished, leading the way to possible abuses. The amended code also brings more drastic measures against employers who use illegal workers. The code stipulates that bosses hiring up to five people without individual work contracts will be fined RON 10,000-20,000 per illegal employee. Hiring more than five people without contracts will constitute a crime punishable by a prison sentence of one to two years or a criminal fine. A court may also forbid an employer found using illegal labor from receiving state aid, including European Union funds managed by Romanian authorities, for up to five years, or from taking part in a public procurement auction. The employer could also have to refund the state aid or EU funds acquired up to 12 months prior to the crime. In addition, the employer will be required to pay the state the value of all the taxes and social security contributions that would have been due, had the worker been employed legally, including overdue penalties and administrative fines. The Labor Code bill also stipulates that in order to check an employee’s


www.business-review.ro Business Review | March 7 - 13, 2011

Courtesy of gov.ro

abilities, after the signing of an individual work contract, the employer can set a trial period of up to 90 days for executive jobs and 120 days for management jobs. No more than three consecutive limited period work contracts are allowed between the same employer and employee, each no longer than 12 months, unless extended for the duration of a project’s development with the parties’ written consent, says the amended Labor Code. The document says the two parties may agree to set a probationary period for the newly hired employee, of no longer than 90 days for regular positions, or 120 days for management positions. Both the employer and the employee can terminate the working contract at the end of this period or beforehand on the basis of a written form. There is no limit to the number of employees a company can hire on probation. Romanian employees who have committed disciplinary infractions will have their records wiped clean after a period of twelve months, according to an amendment to the Labor Code. The draft Labor Code also contains a provision whereby companies that reduce or temporarily cease their activity may put their employees on unpaid leave, with prior notice to the local union.

LEGISLATIVE CHANGES 13

The government is taking on the opposition parties over the Labor Code amendments

Tax cuts back on the agenda Among the government’s fiscal priorities this year is reducing social contributions, and in the long run, cutting VAT and reducing the flat tax, said Andreea PaulVass, adviser to the Prime Minister Emil Boc, during the ninth Romanian Tax, Law & Lobby event organized by Business Review. She added that there is a “high probability” that the social contributions cut will come during the second semester of 2011.

In her opinion, 2011 should be the year when the authorities decrease the fiscal burden, starting with labor costs. “We are surrounded by countries that have lower flat taxes,” she added, naming Bulgaria, Ukraine, Hungary, the Republic of Moldova and Russia as Romania’s fiscal competitors. Vass also said that there is an “iron political will” to simplify fiscal procedures

and to fight tax evasion and that this year companies will see “significant progress” in these areas. Another important fiscal change is the ceiling on social contributions and the fact that they will be regulated by the Fiscal Code. Although the measure has been welcomed and should reduce compliance costs for companies, experts say that

“We believe that the labor market is one of Romania’s competitive advantages and we will continue to support those principles that ensure that this advantage is,” said Mariana Gheorghe, president of FIC and CEO of Rompetrol.

Courtesy of gov.ro

Prime Minister Emil Boc hopes the changes will generate more jobs and protection for competent employees

there is still room for improvement. Also, this modification leaves questions about taxing independent work which hasn’t been included in the Fiscal Code. Other fiscal novelties are the reintroduction of income tax for micro-companies and two legislative changes in the field of VAT. The first involves VAT on occasional supplies which comes with new provisions for taxable individuals not established and not obliged to register for VAT purposes in Romania, but who must pay VAT here. The second concerns VAT on business transfers and is regulated by two orders that were published late last year regarding the payment of VAT by taxable individuals not registered for VAT purposes who receive assets in a business transfer. 


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14 LEGISLATIVE CHANGES

PARTNER CONTENT

Practical Aspects of Tax Audits Certainly, a tax audit implies an uncomfortable feeling, even if it is only due to the time spent with the preparation of the information required by the tax audit team. A company has usually arguments with the tax audit team due to various reasons which are not covered by the present article. Thus, we tried to present you a general view regarding the most important aspects which should be considered in the case of a tax audit. Tax Audit Notification In case that the tax authorities intend to check in which way a company has computed, reported and paid its taxes, they have to announce their intend to the said company, so that this shall have the time to get prepare for the audit. In case of a VAT refund, this notification is not mandatory, given that the company has already applied for it and is expecting the tax audit team. Thus, before the inspection, the tax body has to announce the company the beginning of the control, by sending a tax audit notification in written, 30 days (in case of large taxpayers) or 15 days (for the rest of the taxpayers) before. This notification shall indicate: the legal basis of the tax audit, the starting date, the fiscal obligations and audited periods, the possibility to request the postponement of the starting date of the tax audit. Thus, the tax audit notification offers the first information regarding the intent of the authorities to verify a company, the period to be audited and the audit starting date. This notification is to be considered in order to know the objectives of the tax authorities and to prepare accordingly. Postponement of the Starting Date & Audit Suspension In case that, due to justified reasons, the tax audit is not desirable during the period indicated

Florin Gherghel, Head of Tax Department, Noerr Finance & Tax

by the tax audit notification, a single postponement of its starting date is possible, by indicating those justified reasons. This possibility of requesting the tax audit postponement shall be carefully used, because it may only be used once. Of course, the waiver of the tax audit cannot be requested. Moreover, even during the audit, the taxpayer can request the suspension of the tax audit pursuant to an objective situation which is to be confirmed by the control team. This suspension may only be requested once and can only be obtained upon approval by the tax authorities. Fiscal Prescription The audit team can perform verifications exclusively within the limitation period, which is of 5 years and begins on the 1st of January of the year pursuant to the year within the basis of taxation is generated. For acts pro-

vided by the criminal law, the limitation period is 10 years. At the same time, the tax audit shall be only performed once for each tax duty. Therefore, two audit teams cannot check the same period regarding the same tax duty (unless the tax authorities consider that additional facts occurred, which have not been known by the team who performed the latest audit). Practically, the period subject to tax audit starts with the end of the period checked by the previous tax audit. This regulation is expressly mentioned for large taxpayers. For the others, the tax audit shall consider the last 3 fiscal years (this period can be extended over the period of 5 years). The limitation period of the right to ascertain the tax duty is suspended during the period between the beginning of the tax audit and the issuance of the tax decision pursuant to the performed tax audit. Thus, a company has to make sure that a started audit is finalized within the statutory period (as detailed below), for avoiding the elapsing of a long time period between the beginning and the finalization of the audit, in this case, the period subject to tax audit being longer than the above mentioned one. Tax Audit Beginning In practice, in case of audits performed pursuant to a VAT refund application, the beginning of the control is delayed after the submission of the VAT refund application. In case of a tax audit, the tax authorities might unilaterally select the taxpayer, without him being entitled to object. The audit cannot last longer than 3 months (6 months in case of large taxpayers). The control suspension periods are not included within the audit duration. For a faster and more efficient control performance, it is recommendable to check documents

subject to tax audit prior to its beginning. Discussions with the Tax Audit Team Any taxpayer is entitled to be informed regarding the conclusions of the tax audit team within the tax audit performance. This aspect is “officially recorded� by the notification regarding the final discussion with the taxpayer, which is to be attached to any tax audit report. This final discussion with the tax audit team is very important, because one has the possibility to express one’s point of view to the ascertainments of the tax audit team already on this stage. It is important to know that any company may benefit from assistance during the tax audit, this aspect being statutory provided by the law. Appeal against Tax Decisions The tax decision issued pursuant to the tax audit can be contested. Particular attention shall be given, of course, to contestation periods: 30 days for tax decisions and 15 days for minutes regarding contraventions. Decisions issued during the settlement of the contestation can be appealed before the competent administrative court, in case of unfavorable decision regarding the settlement of the contestation. Of course, the regulations regarding appeals before courts shall be observed. An important aspect to be taken into consideration is the fact that a contestation of a tax decision (administrative deed issued pursuant to the tax audit report) does not impede tax authorities to enforce the collection of the supplementary taxes ascertained pursuant to the tax audit, even if contested. Thus, it is also recommendable to file application for suspension of the enforcement against the tax decisions, beside the contestation action.


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LEGISLATIVE CHANGES 15 PARTNER CONTENT

What is the new Labor Code bringing about? The matter of increased flexibility of employment relationships has been intensely debated lately, and employers have challenged the various constraints and limitations imposed by the Labor Code. The legislative inflexibility of the regulations on employment relationships and the lack of options and solutions for particular situations that employers have to deal with has had a negative impact on the labor market’s potential to attract investors in general and foreign investors in particular. The amendments proposed by the Government in relation to the Labor Code are particularly focused on increasing the flexibility of certain regulations, so as to provide solutions supporting employers and stimulating labor efficiency and performance, also ensuring a higher employment rate. Inter alia, the proposals for the amendment of the conditions concerning the employment for a definite term fall under the scope of the same matter. To be precise, it was considered to extend the maximum term of individual employment agreements concluded for a limited period, from the current 24 month-term, according to the current text of the Labor Code, to a 36-month term, and to regulate the possibility of executing such agreements for the particular term of certain projects. Such amendment is meant to satisfy a practical need, especially prominent in certain businesses, such as constructions, characterized by activity ups and downs, or where the activity to be carried out and the workforce need are tightly related to the development of particular projects. In relation to alternative em-

Şerban Pâslaru, Partner at Ţuca Zbârcea & Asociaţii and Head of the firm’s Labour and Employment Practice Group

ployment options, derogating from the rule of the individual employment agreements concluded for an indefinite period, certain amendments were considered as regards temporary workforce, provided by employee leasing companies, to ensure the completion of certain projects/missions lasting for 36 months at the most, as compared to the maximum 18month term stipulated by the current regulation. Another significant amendment proposed by the new Labor Code version is that of the performance review as the main criteria in selecting employees to be dismissed under collective lay-off procedures, to be applied prior to other possible social criteria, reg-

ulated by the collective bargaining agreements. In other words, employers shall no longer find themselves forced to dismiss employees with good professional performance, if collective lay-offs are imposed by economic difficulties, for the mere reason that their social situation might be better than the social situation of certain less efficient employees, or employees with poorer professional training, which they are constrained to keep under their employment pursuant to the current regulation. Moreover, as an alternative to lay-offs, the draft Labor Code provides employers with the possibility to reduce the work schedule from 5 to 4 days per week, applying an appropriate wage cut, in case of temporary downsizing. On the one hand, this amendment is meant to provide a solution to the difficulties encountered by employers in the current economic climate, and on the other hand to protect employees against lay-offs. Other amendments concerning the termination of employment relationships concern the notice term in case of resignation. So far, the notice term for resignation was of 15 days for operating staff and 30 days for management staff, while the draft of the new Labor Code considered by the Government extends the first term to 20 days and the second one to 45 days. As for employment per se, the Labor Code amendment draft is considering a series of changes, such as the extension of the trial period to 90 days at the most for operating staff, and respectively 120 days for management members. One of the proposals in favor

of the employees is the provision on employee rehabilitation in case of misconduct. The disciplinary sanction enforced against an employee is to be de-registered within 12 months as of the application date thereof, provided than no new sanction has been applied in the meantime to such employee. Employees shall therefore be protected against the application of harsher punishments by the employers, in consideration of past sanctions. Moreover, another aspect acknowledged by the new regulation to employees is the increase of the night work benefits, from the current 15% ratio to 25%. Thus, employees who work at least 3 hours during the night, benefit either from a reduction of the regular working schedule by one hour, or from a 25% bonus of the base wage. In order to avoid abuse by employers and to ensure the observance of legal provisions on employment, the draft Labor Code tightens the applicable sanctions, as regards using workforce without executing individual employment agreements to such effect, or the failure to observe the national minimum wage rate. The measures proposed for implementation under the Labor Code are part of the modernization process of the current regulation, devised to meet the current labor market needs, according to Romania’s development stage and to the undertaken economic goals. To what extent such amendments shall trigger positive changes in the investors’ perception of the labor market, ensuring the better use of workforce, is yet to be determined.


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16 LEGISLATIVE CHANGES

PARTNER CONTENT

The government as Robin Hood: changes to the Fiscal Procedural Code In 2010 we witnessed an entire range of government ordinances being issued one after the other by the current executive. Tax matters spurred a great deal of controversy, particularly the new changes in the legislation regarding the audits assessing the individuals’ “fiscal condition” implemented by Government’s Emergency Ordinance 117/2010.    At a first look this Ordinance would challenge the splash of expensive items that, quite often, cannot be justified by their owner’s declared revenues. Hence, the measure may prove to be very popular especially in a society very fond of the old saying “let thy neighbor’s goat die”. The Ordinance implements the term “fiscal condition” without clearly defining this term, and, as a consequence, leaves quite a large degree of interpretation to the tax inspector and, later, to the courts of justice which already stumble all the time upon the Romanian fiscal legislation as is. Leaving this discussion aside, once the tax inspector, having assessed one’s “fiscal condition”, discovers that the difference between the “fiscal condition” (as assessed) and the individual’s declared revenues is higher than 10% and at least 50,000 RON, then the individual’s tax base can be adjusted and a tax decision in this respect shall be issued. Three “indirect methods” are available to the tax inspectors to determine the adjusted tax base (a) the method of the funds’ source and destination (the effective comparison between one’s expenditures against his/her declared revenues in the relevant period); (b) the method of treasury flows (assessment of individual’s bank accounts and cash flows operated in connection with sources of revenues and destination); and (c) the method of increase in one’s patrimony (the determination of the increment of one’s net patrimony within one fiscal year). Again, as we could have already expected, the procedure regarding the effective implementation of these indirect methods shall be approved, at a later stage, by way of a Government Ordinance, leaving one to wonder whether the rule of law, along with the legislature in this country, have actually died. The Ordinance - given the threshold of 50,000 RON - clearly targets a certain small group of taxpayers and, hence, proves its heavy political charge and, eventually, risks the qualification of repressive instrument as it ignores the non-discrimination principle and leaves out of the ambit of this norm

Delia Dragomir, Managing Counsel, Salans

more than 50% of taxpayers. At the end of the day however, Robin Hood also, arguably, robbed the rich to give to the poor and he was quite popular. And even though some people may criticize the means used by Robin Hood to attain his goals, quite few question, in a welfare state, the legitimacy of governmental coercion to redistribute income. Thus, the Ordinance does have strong popular roots. Nonetheless, two comments are worth mentioning. The first one refers to the “Samaritan’s dilemma”: the government assistance rendered by redistributing income leads at the end to a decrease in self-reliance and, as an immediate consequence, to an increase in the amount of need. In the long run, redistribution undermines the very means of achieving income security. The second comment points out the correct interpretation of Robin Hood’s story. Robin Hood’s claim to fame was not that he took from the rich to give to the poor, but that he took from the tax collector and gave back to the people their own money. Maybe our government, which has taken over almost all attributes of the rule of law state, is trying to read the story correctly. Eventually.


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LINKS 17

From Boom to bust: TV services battle hots up The market of television services is tipped to undergo drastic changes, as some major shifts are on the way. At the moment, the main players providing TV services are RCS&RDS, Romtelecom and UPC Romania, who together have more than a 70 percent market share, the rest being split between smaller operators. Large as they are, these firms, which can offer triple-play services, are negotiating takeovers to help them in the race for new customers. ∫ OTILIA HARAGA

STOCKEXCHANGE

One of the rumored takeovers on the market materialized last week when Romtelecom officially announced that it had acquired Boom TV. The firm is taking over the station in order to add Boom’s 95,000 subscribers to its customer base. These were not the first negotiations between the telephone operator and Boom TV. Two years ago the companies also sat round the table but failed to reach a result. “Romtelecom has signed the contract to take over the assets and customer base of Boom TV with DTH Television Group. The total price of the transaction will be established based on the number of customers who are taken over. Romtelecom has notified the Competition Council of this takeover based on the offer that was submitted,” said the operator in an official statement. The media reported that the company was willing to pay between EUR 7.3 and EUR 8 million (excluding VAT). The negotiations took place through Casa de Insolventa Transilvania, which is currently representing DTH Television Group, the company that runs the insolvent Boom TV. At the moment, the TV group has debts of more than EUR 100 million. When asked by Business Review, Romtelecom representatives said the company was not making any further comment, either on the price or the number of subscribers it has acquired. The number of Romtelecom’s DTH Dolce television customers surpassed 1 million last year. The firm posted rev-

Turn off: viewers are ditching their high cost TV subscriptions for cheaper ones

enues of EUR 716.9 million in 2010, a decrease of 8.4 percent, according to a report by Greek company OTE. But what led Boom TV down the insolvency path and what was the market context? The initial plan was for Boom TV to target a premium sector of clients who were willing to pay monthly subscriptions of EUR 10 and more, which was far above the average price on the market. In three years’ time, the portfolio of clients was planned to have reached 300,000 subscribers. By that time, the investments and expenses should have been covered by the shareholders and via external financing, or bank loans. However, internal and external factors put these goals out of reach and drove the firm to insolvency. DTH Television shareholders turned off the financing tap in April 2008, when the company’s development plans re-

quired a further EUR 25 million of investment plus ensuring current financing. At the beginning of 2009, Boom TV had a portfolio of 232,000 subscribers, which was still below the necessary level to cover its expenses, according to a report by Casa de Insolventa Transilvania. Many of the company’s customers had overdue bills. When the insolvency procedure started, the value of provisions for uncertain debts was RON 32.23 million, 23 percent more than at the beginning of the year. In fall of 2008, DTH took out a bank loan of EUR 18.5 million, which helped solve temporary difficulties, but in time plunged the company deeper into debt. Consequently, Boom TV had to close its six working points around the country, which had immediate repercussions for its entire activity. On top of this, recession-hit consumers were swapping their expensive

subscriptions for cheaper ones, but the company failed to adjust to this new market reality. Not only that, but Boom TV was unable to compete with the offers thrown onto the market by its competitors. This put it at a disadvantage both on the low-price market segment due to the prices it charged, but also on the premium market segment as it could not afford to broadcast commensurately high quality programs. From an elite television supplier Boom TV had become a mass-market provider, but without cutting prices and expenses accordingly. This led to a customer exodus and made it impossible to attract new viewers, according to Casa de Insolventa Transilvania’s report. While Romtelecom’s takeover of Boom TV has already become a fact, RCS&RDS is rumored to be in negotiations to buy UPC Romania, part of Liberty Global. The rumor has not so far been confirmed officially by any of the companies involved. It first surfaced last week on the blog of journalist Catalin Tolontan, who wrote: “These days there are discussions abroad regarding a deal through which RCS&RDS would take over UPC Romania. Both RCS and UPC have businesses on various Eastern European markets, so the transaction could mean that UPC gives up Romania in exchange for another region that RCS would give up,” says the blogger. If the two companies close the deal, and if the transaction is approved by the Competition Council, the new organization that is born would be a giant that would only have Romtelecom as an equal competitor on the TV market. On the internet and telephony segments, it would also compete on an even footing with telecom players such as Orange, Vodafone and Cosmote. RCS&RDS is mainly controlled by Romanian businessman Zoltan Teszari, who has kept a low profile in the media. The company is run by its president, Alexandru Oprea.RCS RDS posted revenues in excess of USD 700 million last year. It has adopted an aggressive business model based on offering many products and services for free, with a view to attracting as many clients as possible. This, however, means that RCS&RDS has outstanding loans of USD 175 million this year and another USD 375 million due in 2012, according to Moody’s. UPC Romania’s customer base decreased by 7.4 percent last year. While it had 1.249 million customers in 2009, by the end of 2010 the figure had fallen to 1.15 million. The company has been losing analog cable clients (a 22.8 percent fall to 645,900), while gaining new ones on the digital television segment (up 23 percent to 283,900).

otilia.haraga@business-review.ro


18 BALANCE

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Lights, camera, action! Romanian New Wave ponders new direction It all started in 2005, with the release of Cristi Puiu’s The Death of Mr. Lazarescu. After that, the new wave of Romanian cinema (aka the New Romanian Cinema) quickly caught the eye of the international film industry. Six years later, romantic comedy Buna! Ce faci? (Hello! How are you?) has finally reached local screens prompting critics to wonder: has Romanian new wave finally reached maturity and if so will it now embrace other genres?

∫ CORINA DUMITRESCU Film journalist and critic Mihai Fulger, who in 2007 published the volume of interviews The New Wave of the Romanian Cinema (later to be awarded by Romania’s Film Critics Association), believes that the actual onset of the current cinematic wave occurred in 2001, with Cristi Puiu’s first film, Stuff and Dough. “Nobody then expected this to lead to international acclaim, not even then young directors Cristian Mungiu and Radu Muntean, making their debuts in 2002. The cinematic pattern established by Cristi Puiu gradually became a trend after the director received the Un Certain Regard award at the Cannes Film Festival (plus dozens of other international distinctions) for his second feature, The Death of Mr. Lazarescu (2005).” Until 2005, Fulger observes, the Romanian cinema was “a big blank on the map of international cinema.” However, theater critic and professor of Drama Theories at UNATC, Anca Ionita, says this is not entirely true, if you look back further: “Film and theater director Liviu Ciulei, who was awarded the best director prize for Padurea spanzuratilor (Forest of the Hanged) in 1965 at Cannes, became a well known personality abroad, both in Europe and in the US. Between 1980 and 1985 he was the artistic director of Guthrie Theatre, Minneapolis, making a huge impact on American theatre.” So what characterizes the genre? Fulger lists the typical ingredients of recent Romanian films: “raw, uncomfortable realism, realistic situations (many films are based on real cases) and ‘live’ characters (neither exceptional, nor exponential), authentic dialogue (filled with

duction to recover all of its investment actually significant ‘nothings’) and sposomeone is not yet sure of that, they will ken very naturally (without the theatribe after their fourth, fifth or sixth film. was Cristian Mungiu’s 4 Months, 3 Weeks, 2 Days, the film journalists agreed. cality that characterized most of the inAnd abroad, these films gained attention Mungiu’s feature, which took the highest terpretations of local productions), ‘inbecause they are viable and interesting hand’ or ‘on-shoulder’ filming, long, large artistic proposals. In short, good films. prize at the Cannes Film Festival, the Palme D’Or, in 2007, grossed a total of and almost fixed frames, the deliberate Not because, as critics would say, they ofUSD 10 million, most of which came rejection of foregrounds and non-narrafered the Western World what it wanted from outside Romania. tive music (lacking an explicit or implicto see (in fact, foreign critics and spectaIn place of the big bucks that come it on-screen source).” tors showed every sign that they had disfrom the studio system in the US, much And efforts that have deviated from covered a world they did not know, be it of the credit for the existence of Romanthis formula have not always enjoyed communist or post-communist) or beian films goes to the National Center of their fair share of attention. Ionita cites cause they exaggerated the ‘dirt’, a cliché Cinematography (CNC – Centrul Nationone Romanian film that did not receive its in which many spectators with identity isal al Cinematografiei), Ciuverca adds, sues became stuck.” due publicity, The Medal of Honor Others say that the success of local “without which Romanian films would not (Medalia de onoare). “The creative work exist. Sponsors are rare and seldom genfilms may well be random. Writer Jeanof director Calin Netzer and scriptwriter Lorin Sterian, occasional actor, erous or powerful enough to support an Tudor Voican deserved more attention industry.” scriptwriter and filmmaker, believes it from local film critics and the general meSo where now for New Wave? In 2011, could be down to cultural trends: now it dia, since it goes beyond the established Fulger believes that film buffs should is the turn of Romania to gain attention: recipe of a realistic view of life in postkeep an eye out for Cristi Puiu’s Aurora, 1989 Romania, adding a ‘human’ per- ”There were years when Iranian cinema Bogdan George Apetri’s debut, Periferic was sought after, and Russian films, and spective to the main character, highChinese (not necessarily in that order). (Peripheral), Catalin Mitulescu’s Loverboy, lighting his psychological process, rather Adrian Sitaru’s Din dragoste, cu cele mai Now it is Romania’s turn. It is said that Rothen ‘weaving’ his actions into the factual bune intentii (Out of love, with the best manians make films for international background.” Fulger agrees that Medal of festivals and not for their own public, intentions), as well as three other debut Honor was overlooked. Another negfeatures, including theater director Silviu which irritates our directors. The truth is lected movie Ionita adds, “which was Purcarete’s Undeva la Palilula (Someperhaps somewhere in between. What is very well received by American critics but where in Palilula). Ionita, in her capacicertain, however, is the fact that the exdidn’t get the attention it deserved, I ploitation of communism brought awards, ty as a theater critic, is also keenly awaitthink, from European ones, is Corneliu ing the launch of Purcarete’s film. Porumboiu’s Police, Adjective (Politist, fame and a respected position in EuroThe debate on the merits of local adjective), a masterpiece, in my opinion, pean cinema.” film has also exercised the international But whatever the reason behind the of contemporary cinema.” media. One of the most recent comNew Wave’s storm to prominence, it is not Florentina Ciuverca, film journalist ments was an article published in Febheaps of cash. Fulger and Ciuverca both and editor at filmreporter.ro, believes ruary in the Global Post, which described estimate the average budget of a Rothat it is the quality of these films rather Romanian cinema as a global trendsetter, manian film at somewhere between EUR than the New Wave “recipe” that earned going beyond its local parameters: “The 600,000 and 700,000, “of which, the them their plaudits. “An important detail appeal of Romanian cinema goes beluckiest ones recover 10-20 percent at the is that all of the directors of the New Wave won awards with their first or second film, Romanian box office”, says Ciuverca. yond its minimalist style, whose influence can be seen in films like Sofia CopAdds Ionita, “The real issue here is the which means that they grew and evolved pola’s Somewhere. The themes of Rosmall number of cinemas across the together, borrowing ideas from one anmanian films tend to be universal in country, which is directly responsible other and taking them further. Each of their appeal.” for low box-office figures.” The only prothem has his own distinctive voice and if


www.business-review.ro Business Review | March 7 - 13, 2011

BALANCE 19

Goodbye Ceausescu: does Hello! How Are You? mark a cinematic turning point or is it just marketing buzz? The newly released comedy is indeed “a breath of fresh air”, as a 2010 review in Variety magazine described it, in the dark world of the cinematic creations of Puiu, Mungiu, Serban, Muntean and Porumboiu. The bittersweet romcom tells the story of a couple whose twenty-year marriage has gone stale. Each seeks love elsewhere and, through an ironic twist of fate, ends up chatting to the other and falling in love with their interlocutors, without realizing who it is. While the two adults play out their mid-life crises, their 17-year-old adolescent son deals with his own troubles, caught between his overwhelming emerging sexuality and, eventually, true love. The film had a budget of EUR 800,000, the director told Business Review, and is based on a true story, which appeared in the local press over four years ago. Financial reasons delayed the film’s release. During a press conference held after a preview of the film, critic Andrei Gor zo

“Abroad, Romanian films gained attention because they are viable and interesting artistic proposals” Florentina Ciuverca, film journalist dismissed it as “insipid” and said that all the discussions built around it may be a clever marketing strategy. The film should not be regarded as a trendsetter, Gorzo added, since the comic genre has been mined in Romania several times recently (he gave the examples of Ho Ho Ho and Poker). But others at the event disagreed. Romanian film critic and artistic director of the Transylvania International Film Festival (TIFF), Mihai Chirilov, believes that the movie is a “leap from bad-taste films (such as Ho Ho Ho or Poker)” and is “a film that Americans could easily remake in five years”, since it successfully follows a blockbuster formula. Chirilov insisted that Hello! How Are You? represents “a passing from the New Wave to something else”.

Cristi Puiu, founder of the New Wave

As for the future of Romanian cinema, Chirilov, who reportedly anticipated the success of Mungiu’s 4 Months, 3 Weeks, 2 Days, believes that the next blockbuster will also come from the Cannes-winning director. Until then, however, he said, Romanian cinema desperately needs films that sit easily in a genre.

corina.dumitrescu@business-review.ro

ROMANIAN CINEMA In numbers* RON 2,709,232 the average budget of a feature film RON 360,512 the average budget of a short film RON 5,707,680 the average budget of an animated film RON 726,216 the average budget of a documentary 160,760 spectators attended Romanian films in 2010 RON 2,007,955 total gross of Romanian films in 2010 *according to data from CNC (The National Center of Cinematography)

Director Cristian Mungiu is expected to produce the next Romanian blockbuster


www.business-review.ro Business Review | March 7 - 13, 2011

20 CITY RESTAURANT REVIEW

FILM REVIEW

Dumb name, but great food

Inside Job

Photo: Laurentiu Obae

Lofty aims: the quality of the food should ensure The Loft hits heights of popularity

The Loft, 64 Iancu de Hunedoara, or entrance opposite Mega Image on Stefan Cel Mare.

which is inside the square of the dining area. The furniture was a let down with cheap dark brown tables and matching plastic chairs. But you miss this point in the overall design experience, which is relaxing and soothing. OK, let’s go and eat! MICHAEL BARCLAY The menu arrived, and I almost fell off my seat laughing, for it was illuminated. Yes, that means it glowed by being powered The world marvels at the total lack of a with a battery, and it emulated a comsense of humor which apparently besets puter tablet. OK, it was a ‘first’ for unsothe German nation. But this pales into inphisticated Bucharest, and it made an imsignificance when you compare the Gerpression. mans’ (self deprecating) lack of humor But the real impression was inside the with that of the Romanians. menu. They have a French chef, and if he Romanian humor is so very odd that it can pull off his menu it will make him the cannot be appreciated by any other natop French chef in the land. Each dish on tion. If you need proof, just look at today’s the menu had a silly name attached. Vegchoice of restaurant – The Loft (mansard) etable soup was described as “Vegan which is not a loft, but rather a ground Zombies” and French Onion Soup was floor restaurant. Oh yeah! So very un-fun“Mother of Tears”. Oh God, this is so emny. barrassing. That stupid name may inspire a smile, but So we started with an endive salad entiif it is intended as a fall-down, hysterical joke, it fails! It also fails on other points, tled “Lawrence of Arabia”. Oh, enough is enough with this silliness. Let’s judge the but not on the quality of its food! So let’s food on its own merits. go and eat there. We called our waiter. He was so miserable Situated in a new red brick office block housing both companies and Mega Image, that I thought that somebody had just told him that his dog had died. Well, you would guess (and be correct) that the they must have had a lot of dogs die, bedecor would be state of the art. Abcause everybody, and I shall repeat that, solutely! every waiter was wearing a miserable face You enter a cavern of a room, all open like a wet fish. plan. Again and again, I reinforce the So I asked my wet fish if the foie gras point I made many years ago in this colstarter was a terrine or a pan fry. He didumn, namely that villa conversions with n’t know. He had to refer the question to lots of boxy rooms are all destined for his colleague, who was too busy playing bankruptcy. Diners want the buzz of othwith his hi-tech hand-held computer toy ers’ conversation together with seeing to bother to answer me. their friends, accompanied by their So Blondie ordered the above endive spouses or not. So vast, open space salad which was superb. It is difficult to restaurants are the ‘rule’ around the fall in love with a salad, but the House did world... and The Loft qualifies. a good job by adding fresh dates as a perIt is a square shaped room with a huge fect balance to the bitterness of the anceiling, boasting a modern, crazy, shapedives. With starters coming in at around less mass which looks like a concrete RON 35-59, they were not over priced. We sculpture (but is not) and I loved it. Being a square, I also loved the waiting area, passed on a fascinating ‘foie gras terrine

wrapped in a chocolate coat’. This dish alone warned me that the House had a serious chef and as for his other creations on starters, I will leave it to you to explore. It is well worth it. Chef excelled himself on the mains. Blondie didn’t want to do a ‘double’ on an 800 gram Wagu beef at RON 380. If that sounds expensive, believe me it is not. Wagu is the Kiwi version of Japanese Kobi beef which is the most superb and expensive meat dish in the universe. Bravo House for giving us such a quality bargain. So Blondie mooched off my excellent ‘clam risotto’ which, in true keeping with the traditional standards of fine French cuisine, was an understatement. It was not a simple risotto, rather it was reduced down in black octopus ink, gently boiled with correct Italian risotto rice and deeply flavored with clams, together with a few slices of fresh Parmesan. I was in heaven. Thank you, Chef. At this stage I was clamorings for man’s food. Yes, beef! They had sirloin and fillet which my waiter told me came from Poland (no, I think he made an honest mistake, but it was not Romanian beef) and there was a further option of Black Angus from England. Will every chef in Romania please take note that you can source Angus and Charollais beef here in Romania at last, without going to buy it in Europe. Blondie and I passed on beef, together with the Alaskan Crab Legs, which we have all seen on the Discovery Channel’s World’s Most Dangerous Catch, where wussy Canadians pretend to be in mortal danger by catching a few crabs. Well, you can catch them here at RON 130. So I settled for a simple sea bass. But there was nothing simple here. For in keeping with French gastronomic tradition, the description belies the beauty you receive. I had a perfect, fresh, tender fillet accompanied by a wonderful mashed (puree) potato which was shaved with a generous slice of fresh truffle. I will not recite the menu further, because the chef is clever enough to ‘plate it up’ to such a beautiful degree that you may not recognize your order as it looks as pretty as a work of art on your plate. Many years ago a far wiser man than I stated that “every dog has his day”. A few years later, a man far more stupid than me stated that “every person shall have 15 minutes of fame”. Well, they were both saying the same thing. And it applies to restaurants. Two years ago the top fitze chophouse was Casa Di David. It was rubbish. It was followed by all the restaurants around Herastrau Lake who vied to be the number one in the city. I can confidently predict that as long as The Loft keeps its chef, it will be the number one in the country, unless someone else…

mab.media@dnt.ro

Bad job: who caused the financial crisis?

Directed by: Charles Ferguson Narrator: Matt Damon

∫ DEBBIE STOWE Only one person used his Oscars victory speech to plead for people to be jailed: Charles Ferguson, director of this eyeopening dissection of the causes of the economic crisis. Ferguson is furious that despite the enormous abuses that brought the world to the brink of financial meltdown, no financial executive has been imprisoned for their part. After watching his documentary, you probably will be too. Bankers, brokers, politicians, authors, journalists and academics – as well as a brothel madam and a therapist – help piece together the calamitous events that sent shockwaves from the trading floor in New York to the factory floor in Beijing. Deregulation allowed lenders to play fast and loose with their depositors’ savings, ridiculous bonuses incentivized reckless gambling, while increasingly opaque financial instruments put so many middlemen between lender and borrower that banks raced to snap up the riskiest customers. Not a recipe for stability. The documentary does a good job of explaining all the technical chicanery of the bankers and traders – which we used to think was so impenetrable because they were really clever people but now know was simply a demented house of cards waiting to collapse. Ferguson astutely got Matt Damon – one of Hollywood’s most trusted actors – to narrate. And the story contains as much corruption and subterfuge as any Jason Bourne thriller. Tales of financial professionals’ cocaine, strippers and conspicuous consumption will surprise few today. But Inside Job also reveals the more insidious and incestuous side of the scene, how Wall Street’s grasping tentacles snake into the White House, as well as the top US universities. Dissenting voices – the economists, writers and politicians who spotted the madness for what it was – were ignored. And, most worryingly of all, they still are: a US administration packed with perpetrators shows little appetite for real reform, so the whole thing could happen again. Though the film ends with a rather cheesy piece of patriotism – a rare wrong note – it offers few answers. And though it’s fun watching the humbled masters of the universe squirm under questioning (even though we know they’re going back to yachts and penthouses), more sobering are the images of the deserted factories, abandoned homes and tent villages that speak of the enormous social cost of the greed, hubris and grubbiness that make documentaries like this so important.


www.business-review.ro Business Review | March 7 - 13, 2011

CITY 21

WORLD MUSIC

Moby to Go to Romanian seaside

Photo: Bill Ebbesen

The DJ is much awaited by local fans

Musician Moby is returning to Romania in August, as part of The Mission Dance Weekend at seaside hotspot, Navodari. The American DJ has been to Romania twice before, in 1996, when he performed

at Sala Polivalent, and in 2009 as part of B’estfest. This will be his first local gig outside Bucharest. Moby, born Richard Herman Melville, has been writing music since the age of nine. His work has embraced a series of styles, from rock, punk and heavy metal to dance, techno and ambient. He initially became known as a DJ, enjoying his first hit in 1991, with Go. The musician has since sold over 20 million records worldwide and has collaborated with the likes of Sophie Ellis Bextor, Britney Spears, Gwen Stefani and Kelis. He has also remixed music by David Bowie, Metallica, The Beastie Boys and Public Enemy. Moby’s most recent album, Destroyed, will be released this May. Until then, the EP Be The One can be downloaded for free at www.moby.com. The Mission Dance Weekend is taking place on August 5 and 6 on Navodari’s Hanul Piratilor beach, on the Black Sea coast. More information will be made available soon by organizers, at www.themission.ro. ∫ Corina Dumitrescu

WORLD MUSIC

DJ Tiesto spins the tunes once more in Romania One of the most popular DJs in the world, Tiesto, is returning to Romania for an open-air gig at Arenele Romane, on June 18. The artist has a sizeable local fan base and has taken to the decks here on several previous occasions. The Tiesto concert is being organized under The Mission concept and is part of Tiesto’s worldwide Club Life 2011 Tour. The Dutch-born DJ, whose real name is Tijs Michiel Verwest, was the first DJ to perform at the opening ceremony of the Summer Olympics in Athens, in 2004.

He officially began his musical career in 1985, when he became a resident DJ at several clubs in the Netherlands, and has since then repeatedly been ranked high up the DjMag Top 100, while winning various trance and dance awards. Advance tickets are going for RON 50 and can be ordered online at www.bilete.ro. On the door, entry will cost RON 70, and VIP tickets RON 100. ∫ Corina Dumitrescu

FILM AWARD

Romanian short film gets European Film Academy Awards nod Derby, a short film by Paul Negoescu, has received a nomination at the 2011 European Film Academy (EFA) Awards, often referred to as the European equivalent of the Oscars. The ceremony will take place in Berlin’s Tempodrom Hall in December. Derby tells the story of a father who worries that he is losing control over his daughter, once he realizes that she might be in a sexual relationship with her boyfriend. The entirely independent pro-

duction, which premiered at the 60th Berlin film festival, has also been selected in 30 other festivals, including in Karlovy Vary, London, Sarajevo, Vancouver, Vila do Conde, Namur, Sao Paulo, Rio de Janeiro, Hamburg and Rome. Negoescu was previously nominated at the EFA in 2009, with another short film, Renovation. Other Romanian directors featured in the same category are Cristi Puiu and Cristian Nemescu. ∫ Corina Dumitrescu


www.business-review.ro Business Review | March 7 - 13, 2011

22 IN TOUCH

QUOTE of the week “The bullet flew past our ear,” said Prime Minister Emil Boc last week on TVR. The PM was referring to the economic risks of failing to take state austerity measures. “Without the measures taken to reduce expenses we would have had a budget deficit of 14 percent. We wouldn’t have reduced salaries – we would have had no salaries for months. Now we have stabilized the economy. We did what we had to do and we can look at things a bit more optimistically,” he added. Boc confirmed that the pensions budget needs another EUR 3.3 billion this year.

ROMANIA IN THE INTERNATIONAL PRESS Bucharest gets new mascot Bucharest’s Tourism Association (Asociatia de Turism a Municipiului Bucuresti, ATMB) has announced the winner of its competition for a new city logo. The challenge for artists was to come up with a modernday repr e s e nt a tion of Mitica, a character created by Romanian author Ion Luca Caragiale, to represent Bucharest and Romania through his typical Romanian humor and inventiveness. The winner of the

WHAT WE ARE WORKING ON Otilia Haraga Senior Journalist competition, which ran

from D e cember 24, 2010 to March 1, 2011, is Rox a n a Maria Clain, who gets a weekend at a five-star hotel in Bucharest, with access to sauna, swimming pool and spa, say ATMB officials. The jury was formed of artists and founding members of the ATMB. The mascot, named Mr. Mitica, will appear on various souvenirs that will be sold to symbolize Bucharest.

is writing a piece on the security of personal data on the internet. Two thirds of Romanians have trouble controlling this information and the issue is becoming more of a concern. Who do users trust with their data? Who don’t they trust? And why? otilia.haraga@business-review.ro

Simona Bazavan Journalist is preparing an article on Greek companies active locally. With a strong presence in telecommunications and banking, Greek investors still consider Romania an attractive destination. After a tough 2010, this year should bring the prospect of recovery and new investment projects. simona.bazavan@business-review.ro

Corina Dumitrescu Journalist

EVENTS, BUSINESS & POLITICAL AGENDA March 7 12:00 Centrul Medical Unirea and Euroclinic organize a press conference at Carol Parc Hotel. By invitation only. March 8 11:00 Garanti Bank organizes a press conference at Radisson Blu Hotel. By invitation only. March 9 The official launch of Orhideea Spa. By invitation only. 11:00 Petit Bateau opens its first local store in Baneasa Shopping City. By invitation only. March 10 ∫EVENT 9:00 Business Review organizes the BR Roundtable on marketing and strategic decision making event at JW Marriott Grand Hotel Bucharest. Access based on VIP invitation only. For more details please contact events@business-review.ro

10:00 Ensight Management Consulting organizes a press conference on its affiliation to Eurogroup Consulting. By invitation only. 14:00-16:00 Ernst & Young, S&T Romania and several universities organize an event for the launch of a project on entrepreneurial education. The event will take place at Radisson Blu Hotel. March 15 - March 16 Century 21 organizes the sixth edition of the Real Estate Career Days job fair at the Belvedere building on Baba Novac St. March 17 ∫EVENT Business Review organizes the third edition of the Greek Business Forum event at Capital Plaza Hotel. For more information about registration and future Business Review events, please visit www.business-review.ro/events. March 21 18:00 FPP organizes the book launch of a

volume on entrepreneurship written by Marius Ghenea. The event will take place at InterContinental Bucharest. By invitation only. March 22 ∫EVENT Business Review organizes the sixth edition of the Annual Investment Awards at Athenee Palace Hilton Hotel. For more information about registration and future Business Review events, please visit www.business-review.ro/events. April 7 10:00 The Dinu Patriciu Foundation organizes a conference on the return to Romania of young people who studied abroad. The event will take place at Athenee Place Hilton. By invitation only.

is researching women in business and local success stories. She will touch on preferred areas of development for businesswomen, the glass ceiling and innovative solutions for overcoming workplace sexism. corina.dumitrescu@business-review.ro

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March 11 9:00 Gide Loyrette Nouel organizes the Restructuring and beyond – Lessons learnt and what the future may hold event at the Novotel Hotel. By invitation only.

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ISSN No. 1453 - 729X

FOUNDING EDITOR Bill Avery EDITOR-IN-CHIEF Simona Fodor SENIOR JOURNALISTS Otilia Haraga, Dana Verdes JOURNALISTS Simona Bazavan, Corina Dumitrescu COPY EDITOR Debbie Stowe COLLABORATORS Anca Ionescu, Michael Barclay ART DIRECTOR Alexandru Oriean PHOTOGRAPHER Laurentiu Obae LAYOUT Beatrice Gheorghiu

EXECUTIVE DIRECTOR George Moise SALES & EVENTS DIRECTOR Oana Molodoi MARKETING MANAGER Adina Milea SALES & EVENTS Ana-Maria Nedelcu, Claudia Munteanu RESEARCH & SUBSCRIPTION Lili Voineag PRODUCTION Dan Mitroi DISTRIBUTION Eugen Musat

ADDRESS No. 10 Italiana St., 2nd floor, ap. 3 Bucharest, Romania LANDLINE Editorial: 031.040.09.31 Office: 031.040.09.32 Fax: 031.040.09.34 EMAILS Editorial: editorial@business-review.ro Sales: sales@business-review.ro Events: events@business-review.ro



Business Review No. 7, March 7 - 13