Romania: Emergency measures during the COVID-19 pandemic - Requisition of movable and immovable property
On 16 March 2020, a presidential decree establishing a state of emergency in the territory of Romania was published in the Official Gazette of Romania. The emergency measures indicated in the aforementioned decree include requisitioning property.
1. Sedes materiae
The institution of property requisition is regulated in general by Law no. 132/1997 “on property requisition and service provision in the public interest” (republished) and the Methodological Rules of 24 March 2005 for the enforcement of Law no. 132/1997, adopted by Government Decision no. 219/2005. Specifically, for the case of the COVID-19 pandemic, the presidential decree published on 16 March 2020 has established a series of legal provisions with direct applicability.
2. Definition of “requisition”
According to section 1 of Law No. 132/1997, requisition is an exceptional measure by which competent authorities can request that natural and legal persons temporarily assign, in exchange for compensation, the right to use movable or immovable property to the state for its exclusive use to accumulate the material resources necessary to protect the public interest.
3. Property which may be subject to requisition
In section 5 of Law No. 132/1997, the legislator lists the property that may be subject to requisition. Regarding immovable property, the law does not distinguish between the types of buildings or land that may be subject to requisition, i.e. it does not impose limitations.
The only types of property expressly excluded from the implementation of this measure are: (i) items for personal use and household purposes; (ii) a person’s property that is strictly necessary for the person’s profession or occupation which is his/her source of livelihood; (iii) animals or mechanical traction vehicles belonging to invalids, war widows and underage orphans; (iv) parts of the immovable property absolutely necessary for the occupants; (v) the buildings of penitentiaries and special schools for work and rehabilitation; (vi) the property of orphanages and foster homes, of homes for disabled persons and the elderly; (vii) the assets of cultural, national or international heritage; (viii) property belonging to churches, monasteries or prayer houses of established churches or religious associations recognized by the state and necessary for the continuation of such, and housing for monks; (ix) the quantities of grains, food, vegetables and fruit necessary for the consumption of the owner and his/her family, seeds needed for sowing, and breeding animals and queen bees; (x) the property in the national material reserves and in the mobilisation reserve created according to applicable law; (xi) the property of foreign diplomatic missions and consular offices; (xii) property belonging to foreign legal and natural persons domiciled or with their residence or headquarters in the territory of Romania, which, by international agreements, are exempted from requisition; (xiii) sanitary-pharmaceutical materials necessary for the treatment of chronic patients who prove this status.
4. Persons who may be subject to requisition
A requisition order is issued to the legal owner or holder of the property (e.g. tenant, bailee). Persons who do not hold the property in possession or in legal use at the time of the request are expressly exempted.
At the same time, during the implementation of the requisition measure, the owners or holders of requisitioned property are exempted from paying taxes and duties for that property, and the obligations arising from the contracts legally concluded in relation to the requisitioned property are suspended.
According to sections 32-34 of Law no. 132/1997, failure to comply with certain obligations by persons whose property has been requisitioned may constitute a criminal offence (e.g. refusal to provide the legally requisitioned property).
5. Procedure for requisitioning movable/immovable property
The requisition may be ordered only by means of a surrender order issued by the military authorities by military decree.
The surrender order includes the following mandatory elements: (i) the name of the issuing authority and of the beneficiary unit, (ii) the legal basis of the requisition, (iii) the identification data of the property subject to requisition and of its owner or holder, (iv) the place and deadline for the surrender of the property. On the date of requisition, a surrender report is prepared with regard to the condition and value of the property.
The compensation granted in case of requisition of non-expendable property can be in the form of: (i) rent, the method of its computation being established by government decision; (ii) the difference in value of any property that is returned with major deterioration; (iii) similar property or the value of the property, established according to the technical state and the degree of wear at the moment of requisition, if the property can no longer be returned for objective reasons.
Expendable and perishable property will be permanently requisitioned, subject to payment of compensation equal to the market price at the time of takeover.
The requisition may be ordered for the following time intervals (with the exception of expendable property, which, as mentioned above, will be permanently requisitioned): (i) until the date indicated in the report on surrender of the requisitioned property, (ii) until the state of emergency ceases.
The property is returned based on a restitution report.
Compensation is made on the date of settlement of the requisition report. The details regarding the date of settlement of the requisition report and the method of payment of the compensation are established by a government decision.
If the requisition report is lost, the Central Commission for Requisition may decide to issue a duplicate after declaring the cancellation of the requisition report in the Official Gazette of Romania.
Failure to submit the requisition report for settlement within three years after the starting date of payment has been published in the Official Gazette of Romania will result in the loss of the right to compensation for the requisitioned property.
6. Challenging the requisition measure
In accordance with the provisions of section 29 of Law no. 32/1997, appeals may be lodged with the Joint Commission for Requisition regarding: the prices charged, the value of the compensation for the requisitioned property and the method of payment of the compensation, within no more than 90 (ninety) days after the restitution report has been prepared.
Currently, in view of the provisions of the presidential decree published on 16 March 2020, the following property may be requisitioned: (i) units for the production of materials and equipment needed to fight against the COVID-19 pandemic; (ii) supplies, production and distribution capacities, protective equipment, disinfectants and drugs used/usable in the treatment of COVID-19; (iii) property for the purpose of solving material problems of any kind to fight against the COVID-19 pandemic.
The aforementioned presidential decree is valid for a 30-day period, but, depending on the evolution of the COVID-19 pandemic, a new decree may be issued, one that directly addresses certain categories of property listed in section 5 of Law no. 132/1997 (e.g. requisitioning of commercial immovable property in order to ensure quarantine space).