Romania has adopted changes to its transfer pricing legal framework, effective from the end of July 2025, that:

• Extend the Advance Pricing Agreement (APA) program with a roll-back possibility of up to five years under certain conditions (applicable also for ongoing cases)
• Enhance the Mutual Agreement Procedure (MAP) efficiency (applicable also for ongoing cases)

To align with its Organisation for Economic Co-operation and Development (OECD) accession plan in 2026, Romania is implementing legislative changes to prevent double taxation and improve the resolution of transfer pricing cases involving profit adjustments of associated enterprises. The aim is to enhance predictability in the relationship between Romanian taxpayers and tax administration (the National Agency for Fiscal Administration, abbreviated ANAF), as well as improve the efficiency of the Romanian APA and MAP programs.

An ordinance, published in the Official Gazette at the end of July 2025, amends provisions in the Fiscal Procedure Code pertaining to Romania's APA program and the MAP under Romania's Double Tax Treaties and the European Union's (EU's) arbitration convention 90/436/CEE, "Convention for the elimination of double taxation in relation to adjustments of profits of associated enterprises." The changes do not affect or refer to MAP requests under EU Directive 2017/1852 and are expected to apply to any ongoing APA applications or MAP cases.

Implementation details are expected to follow via yet-to-be-issued orders from ANAF.

APA program updates

The APA program in Romania had been applicable beginning with the year in which the application was submitted. The amendment now expands the scope of the APA program to apply to transactions occurring up to five tax years prior to the year in which the application is submitted, provided they are similar to transactions subject to the APA request for future periods. Further clarifications on the conditions under which this APA "roll-back" will apply are anticipated as the tax authorities make subsequent revisions in secondary legislation.

Romanian tax authorities may suspend an ongoing tax audit while the tax issues and periods covered by an APA application with roll-back request are being analyzed and until the APA application is resolved.

MAP program updates

The changes affect only the Fiscal Procedure Code provisions covering MAP requests made under Romania's Double Tax Treaties or EU Convention 90/436/EEC. (National provisions regarding MAP requests under the EU Directive 2017/1852 have not changed).

Key changes include:

• Affected local companies may request MAP initiation from the Romanian tax authorities, regardless of domestic appeal options or treaty provisions (whether or not the options/provisions allow such requests to be filed with any of the contracting states).
• If the ANAF considers that the MAP request cannot be accepted (the inadmissibility of the request is limited and expressly provided), the ANAF must notify the competent authority of the other state or implement a bilateral consultation process in relation to the object of the MAP request.
• The deadline for submitting a MAP request is three years from the communication date of the administrative tax act or notification causing double taxation, even if the treaty/convention sets a shorter deadline.
• To resolve the MAP request, the ANAF will negotiate with the other competent authority based on a mandate that may change during discussions, considering all OECD-accepted transfer pricing methods and aligned with the OECD Transfer Pricing Guidelines.
• If the negotiations do not result in an agreement, the ANAF will notify the affected person. Upon request, the ANAF must enter arbitration proceedings with the other state. The arbitration result will lead to a settlement decision, without requiring acceptance from the affected person.
• Any ongoing MAP will be terminated if a final court decision is reached in Romania before the competent authorities make a decision on the MAP request.

Impact and key steps

Multinational enterprises (MNEs) with Romanian operations are expected to benefit from these changes that streamline access to double taxation relief on transfer pricing cases. MNEs should analyze the potential benefits of these instruments for improved tax transparency, cooperation with tax authorities and reduced transfer pricing uncertainty. Moreover, MNEs should review the status of their ongoing APA applications and MAP cases involving Romania to reassess their options and potential opportunities based on the above legislative changes.

Interested parties should consult their tax advisors for assistance and help to answer any further inquiries.