Romania – European Sanctions Enforcement

November 25, 2024November 25, 2024 by Mark Handley

Romania – 23 companies fined for sanctions breaches imposed to date

The news website g4media in Romania has made a Freedom of Information request to Romania’s ANAF enforcement agency.

It has published an article summarising the results, and also provided the original response.

The response identifies the following enforcement statistics:

23 companies fined for sanctions breaches to date (between 2020 and 2024);
560,000 lei in fines (c. €112,000);
41,492,169 lei confiscated as the proceeds of crime (c. €8,330,000);
11 of the fined companies have appealed the fines imposed:
- 4 of those appeals were won by ANAF;
- the ANAF lost one;
- 6 of the appeals are pending, although ANAF won 4 of those at first instance;
As part of this enforcement ANAF also undertook 7 audits of companies which were doing business with sanctioned entities and imposed fines of 65,575 lei (c. €13,100).

As per our earlier post, as of November 2022, Romania was reported to have imposed fines of 280,000 lei and confiscated 13,171,000 lei (c. €2,650,000). The balance of these further fines have been imposed since that date.

September 23, 2024September 23, 2024 by Mark Handley

Romania – authorities arrest and extradite suspect to the US

The US Attorney’s Office for the Eastern District of New York has issued a press release concerning the guilty plea by Mohammad Bazzi on charges of conspiracy to conduct unlawful transactions with a Specially Designated Global Terrorist.

The press release confirmed that Bazzi was arrested in Romania in March 2023 by the Romanian authorities, and was then subsequently extradited to the United States to face the charges there.

September 11, 2024 by Mark Handley

Romania – CJEU upholds confiscation of entire revenue of a transaction in breach of sanctions

Further to our earlier post, regarding an Advocate-General’s opinion on a case arising from a fine and confiscation order imposed by Romania’s ANAF enforcement agency, the CJEU has now issued its judgment.

The case concerned a challenge to the confiscation order of €2,984,961.40 being 100% of the gross revenue obtained by the company Neves 77 Solutions SRL in breach of sanctions.

Neves argued that confiscation of the gross revenue was disproportionate, particularly in light of the right to property enshrined in the European Convention of Human Rights. The CJEU disagrees at [93]:

“the confiscation of all the proceeds of the prohibited brokering transaction thus appears necessary in order to dissuade effectively and efficiently economic operators from infringing the prohibition“.

This provides important clarification on whether confiscation orders should target the gross revenue or just the net revenue obtained from the breaches of sanctions.

The CJEU also dealt with the question of whether the prohibition on “brokering services” contained in Regulation 833/2014 requires the goods in question to, at some stage, have entered the territory of the EU. The CJEU has ruled that there is no such requirement.

December 27, 2023January 11, 2024 by Mark Handley

Romania – company fined and €2.9 million profits confiscated

An Advocate-General’s opinion in Case C-351/22 before the Court of Justice has revealed details of a not-previously publicised enforcement action from 2020 in Romania, by which the company Neves 77 Solutions SRL was administratively fined approximately €6,000 and had gross profits of €2.9 million confiscated.

The company had brokered a transaction whereby radio sets manufactured in Russia were sold by a Ukrainian company to an Indian company.

The question which came to be addressed by the Advocate-General was whether the confiscation of gross profits was compatible with fundamental principles of European law including whether it was a proportionate abrogation of the right to property. The Advocate-General’s opinion is that such confiscations are not a breach of European law.

March 17, 2023January 11, 2024 by Mark Handley

Romania – fines and confiscation order overturned

It has been reported today that the Romanian company Deltrans Grup&Ro SR successfully appealed against a fine and confiscation order imposed by the Romanian ANAF.

The alleged wrongdoing related to two orders from a Moldovan company filled by products from plywood producer Sveza. The ANAF alleged that Sveza was owned and controlled by a designated person, Alexei Mordashov.

The court ruled that this link was asserted rather than proven by the ANAF and annulled the fine and confiscation.

It has been reported that the ANAF is appealing this decision.

November 11, 2022January 11, 2024 by Mark Handley

Romania – fines and confiscations confirmed

The President of Romania’s ANAF (National Agency for Fiscal Administration) has confirmed that ongoing results of the organisation’s sanctions enforcement actions.

Without providing details he stated that fines of 280,000 lei (c. €56,000) had been imposed and amounts of 13.171 million lei (c. €2,650,000) had been confiscated.

No further details on these enforcement actions were published.

October 24, 2022January 11, 2024 by Mark Handley

Romania – fine and confiscation overturned

The Romanian company Liberty Galati has successfully overturned an administrative fine and the confiscation of over 7.6 million lei (c. €1.5m).

The alleged breach of EU sanctions related to a shipment of iron ore pellets which left Russian on 22 February 2022, and arrived in Romania on 25 February 2022. The seller of the pellets was Metalloinvest, which is owned or controlled by Alisher Usmanov who was designated on 28 February 2022. The pellets were on-sold in Romania on 1 March 2022.

The initial fine and confiscation was based on the allegation that it was a breach of the EU’s sanctions to deal with Metalloinvest in this way. The court disagreed and held that Liberty Galati had taken title to the pellets on 22 February at a time that Metalloinvest was not subject to sanctions.

May 12, 2022January 11, 2024 by Mark Handley

Romania – successful appeal against fine and confiscation

It has been reported today that the Romanian ANAF has lost another appeal against one of its fines and confiscations.

In this instance the allegation was that the Romanian company Gransol Agro Arad had purchased fertilisers from companies owned or controlled by designated persons under the EU’s Russian sanctions. The imports were said to have taken place between 2014 and 2020.

The court held that the prosecution had not established that the Russian supplier company was in fact owned or controlled by a designated person, and was critical of reliance being placed on google searches rather than official company records.

March 5, 2022January 11, 2024 by Mark Handley

Romania – commencement of investigations confirmed

It has been reported that the Romanian Tax Office (ANAF) has confirmed that it has a number of ongoing investigations into possible breaches of the EU’s Russian sanctions.

No further details were reported.