A foreign company may have Romanian customers, a local sales team and contracts signed at its overseas headquarters. For tax purposes, the place of signature does not always explain who secured the commercial agreement or where the relevant activity took place.
Law No. 213/2026, published on 12 November 2026, amends Article 8(5)(a) of the Romanian Fiscal Code. The amended provision applies from 1 January 2027. It concerns a non-resident’s permanent establishment through a person acting on its behalf in Romania. Having a Romanian customer does not, by itself, create a permanent establishment for every foreign supplier.
What the provision adds from 2027
The earlier wording addresses a person authorised to conclude contracts on the non-resident’s behalf who exercises that authority in Romania. The amended wording also covers a person who habitually plays the principal role in the process leading to contracts which the non-resident company routinely signs without significant changes.
The contracts concerned may be in the non-resident company’s name, may transfer ownership of or grant a right to use property which the company owns or has the right to use, or may concern services supplied by it. The review therefore needs to follow the actual activities of the person in Romania and the process by which contracts are secured, including in businesses supplying goods or services.
The law also explains that negotiating in Romania all the elements and details of a contract that binds the non-resident company can be relevant even where someone else subsequently signs abroad. An internal signing procedure cannot replace a review of the facts.
Which businesses should review their arrangements?
A review may be useful for foreign companies using sales personnel, authorised representatives, intermediaries or other arrangements in Romania that contribute to securing customer contracts. The contractual label given to the relationship does not settle the tax question on its own.
Consider a hypothetical arrangement: a person in Romania discusses the scope, price and essential terms with the customer, while the foreign headquarters repeatedly approves the outcome without significant revision. This is a reason to examine the amended provision. It is not a conclusion that a permanent establishment automatically exists; all relevant conditions, exceptions and the applicable tax treaty need to be considered.
Separately, under Article 8(7), control of a Romanian company by a foreign company is not sufficient on its own to establish a permanent establishment. Incorporating or owning a subsidiary and examining activities performed for a non-resident are distinct questions.
Read the exceptions together with the tax treaty
Article 8(5) concerns a person other than an agent with independent status. Article 8(6) addresses independent agents; independence needs to be assessed against the actual arrangements and relationships, rather than the agreement’s title alone. The amended point (a) retains its reference to the excluded activities in Article 8(4)(a)–(f).
Where the company is resident in a country with which Romania has a double taxation treaty, the review must also consider the treaty provisions applicable to that relationship. Article 1(3) of the Fiscal Code gives the treaty provision priority in the event of a conflict with the Code. Treaty wording should not be assumed to be identical across jurisdictions, and a domestic amendment does not automatically rewrite each treaty.
This article does not review a particular bilateral treaty or determine a company’s filing obligations or tax liability. Those questions require the documented facts and the rules applicable to them.
What should management prepare?
- The actual sales workflow: who identifies the customer, negotiates terms, approves exceptions and confirms the final version.
- Contracts and authorisations: arrangements with the people in Romania, the limits of their authority and the documents used with customers.
- A sample of transactions: the offer, successive drafts, changes required by the foreign headquarters and relevant approvals. The sample should reflect ordinary business practice.
- The international context: the company’s state of residence, the entities involved and the treaty that may apply.
The aim is to compare the documents with how the business operates. A preventive review can identify unclear responsibilities and differences between the formal approval process and actual activity. We do not recommend cosmetic changes intended merely to conceal the role of people in Romania.
Timing and the first step towards a review
The law was published in Official Gazette No. 945 on 12 November 2026. Article II postpones application of the amendment until the start of the year following the law’s entry into force; the official consolidated text expressly identifies 1 January 2027. The date on which the amended provision applies should be distinguished from publication and from any particular tax return deadline.
For an initial enquiry, identify the company’s jurisdiction, its activities in Romania, who participates in negotiations and the purpose of the review. A summary is sufficient at this stage; detailed documents can follow after the matter has been clarified and conflicts checked. Legal analysis of contracts and responsibilities should, where appropriate, be coordinated with tax and accounting analysis.
Relevant services: legal assistance with tax matters and ANAF disputes and commercial contracts. For organisational choices, see our guide to setting up a Romanian company, which addresses a different question from the tax existence of a permanent establishment.
Official sources and scope of review
- Law No. 213 of 12 November 2026, Articles I–II; Official Gazette No. 945 of the same date. Romanian original.
- The official consolidated Fiscal Code consulted: Article 1(3), Article 8(1) and (4)–(7), including the note on application from 1 January 2027. Romanian original.
Sources checked on 13 November 2026. This institutional publication is general information, not an individual tax opinion. No particular bilateral treaty has been reviewed here; the English explanation is not an official translation of the legislation.