LAW
on the privatization of commercial banking companies in which the State is a shareholder no. 83 of 1997

 

            Art. 1. - Commercial banking companies in which the State is a shareholder, further to be called banking companies, set up on the grounds of the Law No. 15/1990 on the reorganization of economic state business organizations as self-managed public companies and trading companies, of the Law No. 31/1990 on trading companies, and of the Law No. 33/1991 on banking activity, shall be privatized according to the provisions of the present law.

            Art. 2. - (1) The privatization of the banking companies shall be realized by making use of one of the following procedures:
            a) increasing the registered capital by contribution of private capital, in cash, on the basis of a public offering or of a private placement, effected according to the legal provisions in force;
            b) sale of shares managed by the State Property Fund, to Romanian natural persons and Romanian juristic persons with majority private registered capital, to financial investment companies resulted from the transformation of the Private Property Funds inclusive, as well as to foreign natural persons and foreign juristic persons with majority private capital, only against full payment in cash;
            c) a combination of the procedures provided under letters a) and b).
            (2) International financial institutions shall constitute an exception from the provisions of para. (1), referring to foreign juristic persons.

            Art. 3. - (1) On the grounds of Art. 3 para. (5) and Art. 6 para. (1) under the Law No. 55/1995 on the acceleration of the privatization process, the registered capital quotas allocated to the Private Property Funds, at banking companies, according to the Law on the privatization of trading companies No. 58/1991* shall form the object of regularization between the State Property Fund and the financial investment companies resulted from the transformation of the Private Property Funds, on the basis of the value of these quotas from the moment of their granting.
            (2) The shares of the regularization quotas in keeping with the provisions under para. (1) shall be managed and sold by the State Property Fund through the methods provided in the present law.

            Art. 4. - The sale of shares managed by the State Property Fund may be carried out by any of the methods provided by the Law No. 58/1991 on the privatization of trading companies, by the Law No. 52/1994 on transferable securities and stock exchanges as well as by regulations issued in application of the present law. (abrogated)**

            Art. 5. - (1) The State Property Fund, in its managing capacity of the State's participation, may reserve itself, in the case of each banking company, a number of shares corresponding to a quota of the total registered capital, or may choose to preserve the registered control share, as the case may be.
            (2) The registered control share provided under para. (1) shall impart to the State the following rights:
            a) to appoint a representative in the managing board of the banking company;
            b) to have the possibility, by exercising the right of veto in the general meeting of shareholders or in the managing board, to oppose the decisions of the other shareholders, with regard to the pledging or mortgaging of the banking company's assets as well as those decisions regarding merger by absorption or their administrative winding up according to the Law No. 31/1990 on trading companies, if by merger or administrative winding up the State's interests might be damaged.
            (3) The registered control share held by the State in a banking company may be converted into an ordinary registered share, by decision of the Government.

            Art. 6. - (1) A privatization commission responsible for the realization of the objectives of the present law and the observance of the principles of transparency, rigour, and objectivity, shall be constituted for the privatization of each banking company, by Government decision, at the joint proposal of the National Bank of Romania, the National Privatization Agency, and the State Property Fund.
            (2) The Privatization commission shall supervise all operations linked to the privatization of banking companies, under the conditions of the present law.
            (3) The privatization commission shall consist of seven members, one of whom shall be chairman.
            (4) The function of member in the privatization commission shall be incompatible with the capacity of member of the managing board of the banking company, of director in the respective banking company, or of member of its supervision council as well as with the performance of activities of a kind to make him dependent on the potential buyers of the blocks of shares offered for sale.
            (5) Members of the privatization commission may not, by inter vivos acts, acquire shares of the banking company over a period of three years after cessation of the mandate, a period in which they shall have the obligation to preserve the absolute secret with regard to the facts and information to which they had access in the exercise of their function and which refer to the banking company whose privatization they supervise.
            (6) Members of the privatization commission may not, before the passage of a period of three years after the cessation of their function, hold the function of manager, member of the committee of management or of the supervision committee of any banking company carrying on bussiness in Romania s territory, of any of its subsidiaries or branches, or to exercise a remunerated activity in the respective banking companies.
            (7) Each privatization commission shall present to the Government a report with regard to the privatization operation for which it was appointed both at its finalization, and on the occasion of the finalization of each of its stages.

            Art. 7. - (1) The privatization of banking companies, by any of the methods and procedures provided under articles 2 and 4 of the present law, shall be realized on the basis of the evaluation report and of the feasibility study prepared by a specialist firm, selected by auction, in keeping with the methodological rules approved by Government decision at the joint proposal of the National Bank of Romania, the National Privatization Agency, and the State Property Fund.
            (2) The evaluation report of a banking company shall be drawn up conformably to international standards in the matter. The feasibility study shall also compulsorily include recommendations with regard to:
            a) the privatization procedure and method(s) indicated to be used;
            b) the optimum structure of the shareholders body which is to result after privatization;
            c) the maximum quota of registered capital that can be acquired by natural and/or juristic persons;
            d) the maximum quota of registered capital that may be offered for privatization at a single stage;
            e) the registered capital quota that shall be reserved to the State, under the terms in Art. 5 of the present law;
            f) the classes of shares that may be issued, the value of the issue bonus and of the selling price, in case the most indicated privatization procedure is the increase of the registered capital or a combination of it with the sale of shares by the State Property Fund.
            (3) The main elements of the evaluation report and of the feasibility study, adopted by the privatization commission shall be subject to the publicity rules in the principal dailies of national circulation as well as in the main international financial weeklies.

            Art. 8. - (1) The measures and procedures used as well as the quotas of registered capital that may be acquired by natural or juristic persons in the privatization process of banking companies shall be established for each case in part by Government decision, at the proposal of the privatization commission, on the basis of the consultation and joint advice of the National Privatization Agency, of the National Bank of Romania, and of the State Property Fund.
            (2) The Government, at the proposal of the privatization commission, shall decide on the circumstances in which the privatization conditions of a banking company, established as stipulated in the previous paragraph, may be modified.

            Art. 9. - (1) The buying of acquired shares from the State Property Fund by the persons provided under Art. 2 letter b) of the present law shall be made both in Lei and in foreign currency. The sums in foreign currency collected by the State Property Fund for the shares managed in banking companies and which shall form the object of a selling-and-buying contract shall be handed over to the State's foreign currency reserve, following which, the National Bank of Romania is to discount the equivalent value in Lei of the foreign currency received, at the rate announced for the day when the transaction was effected.
            (2) In case the privatization procedure selected is the increase of the registered capital, a combination of it with the sale of shares by the State Property Fund inclusive, the subscription of shares shall be effected in Lei, and their payment shall be both in Lei and in foreign currency.
            (3) In case the foreign juristic persons or natural persons shall choose to effect payment of the shares in Lei, fully or in part, they shall have to prove that the respective sums of money were obtained with observation of the foreign currency rules applicable in Romania.

            Art. 10. - (1) Commercial banks, juristic persons with Romanian or foreign nationality, unfolding their activity in Romania's territory, may not grant credits for the payment of shares acquired from the State Property Fund or for the payment of shares subscribed in the case of a registered capital increase at banking companies that are privatized.
            2) Romanian or foreign natural or juristic persons may not use credits obtained in this country for acquiring in any form shares issued by banking companies coming under the incidence of the provisions under the present law.
            3) In the case of credits obtained from abroad, the constitution of the pledge on the shares that are to be acquired as guarantee for their reimbursement shall be prohibited.
            4) The acquisition of shares with violation of the provisions under paragraphs (1), (2), and (3) shall be sanctioned by absolute nullity.

            rt. 11. - The provisions under articles 48 and 49 of the Law No. 58/199 1 on the privatization of trading companies and under Art. 8 of the Law No. 55/1995 on the acceleration of the privatization process shall not be applicable in the case of banking companies that are being privatized as stipulated in the present law.

            Art. 12. - (1) The sums of money resulted from the sale of shares managed by the State Property Fund for banking companies that are being privatized according to the present law shall be paid in to the Special development fund at the disposal of the Government.
            (2) The mode of utilization of the fund provided under para. (1) shall be established by law.

            Art. 13. - (1) Within sixty days after the privatization of the majority of the registered capital of a banking company, an extraordinary general meeting of shareholders shall be called in the new structure resulted.
            (2) The extraordinary general meeting of shareholders provided under para. (1) shall have placed on the agenda the modification of the constitutive deeds and election of the new managers of the privatized banking company.
            (3) At banking companies with partial state registered capital, the State Property Fund shall be represented in the managing boards in proportion to the registered capital quota it manages.

            Art. 14. - (1) Natural or juristic, Romanian or foreign persons acting directly or indirectly, single or together and in connection with third parties, shall not be able to acquire the property right on a number of shares representing more that twenty-per-cent of the total registered capital of a banking company that is being privatized according to the present law, except international financial-and-banking institutions of repute.
            (2) In order to be able to obtain the property right on a number of shares representing more than five-per-cent of the total registered capital of a banking company, a natural or juristic, Romanian or foreign person acting directly or indirectly, individually or together and in connection with third parties must first obtain the express agreement of the National Bank of Romania.
            (3) The acquirement of the property right on the shares of a banking company that is being privatized, with violation of the dispositions provided under paragraphs (1) and (2), shall constitute deviation from the norms of banking prudence and shall be sanctioned with deprivation of the acquirer from the exercise of the corresponding voting rights as well as with the obligation for him to transfer the registered capital quota thus acquired, as stipulated by law.
            (4) The National Bank of Romania shall notify to the managing boards of the privatized banking companies on the loss of the voting right, in the cases provided under para. (3) as well as about the obligations incumbent on the persons in question.
            (5) In the case in which the shares acquired with violation of the provisions under paragraphs (1) and (2) shall not have been transferred within ninety days after the date when the violation was found, the National Bank of Romania shall order the banking company in question to cancel the respective shares, to issue new shares bearing the same number, and to sell them, the price collected having to be consigned at the disposal of the initial acquirer, after deduction of selling expenses.

            Art. 15. - The anticipated selling-and-buying contracts of the shares as well as any other agreements in connection with this operation, concluded before the period established by the statutory acts governing the privatization of the banking company in question shall fall under absolute nullity.

            Art. 16. - On the basis of the reports of the privatization commissions, the Government, together with the National Bank of Romania, shall inform the two Chambers of Parliament every three months on the evolution of the privatization process of the banking companies and its results.

            Art. 17. - (1) Operations in connection with the privatization process of the banking companies, forming the object of the present law, shall not be subject to the financial control of the State Audit Office.
            (2) The State Audit Office may exclusively exercise the preventive check on the sums of money transferred to the Special development fund at the disposal of the Government.

            Art. 18. - (1) The present law shall come into force within thirty days after its publication in the "Monitorul Oficial" (Official Gazette of Romania).
            (2) Within the term provided under para. (1), the National Privatization Agency, the State Property Fund, and the National Bank of Romania shall subject to the Government for approval the organizational measures essential for the application of the present law.

 

Published in the "Monitorul Oficial" (Official Gazette of Romania), Part I, No. 98 of May 23, 1997