While Romania awaits the EU parliamentary elections scheduled for May 2019 and the Presidential elections at the end of this year, Stratulat Albulescu’s Managing Partner Silviu Stratulat is not holding out much hope for significant changes in the country.
“I don’t believe in black and white or in a party being a lot better than another one, and in a huge change overnight,” says Stratulat. “Each political party running in the coming elections has already had power, and neither has done a lot with it.” Instead, he says, he believes that Romania’s problems are related to the public mindset more than the politicians, who merely “represent public opinion.”
“Luckily we are not under a dictatorship, with imposed ideas,” he smiles.
But Stratulat does not let the government completely off the hook, either, and he points out that it has not taken any steps to prevent or mitigate the effects of what he describes as “the looming global economic crisis” on the country. Ultimately, he believes, the development and growth of the Romanian economy could have been handled better, as he says the full potential of the market has not been reached and certain regulations, such as tax code have not been stabilized. “We should have done a lot more to incentivize investments,” he sighs, describing Romania as a market with immense potential for international investors.
On the other hand, Stratulat concedes that the market is not stagnant, and that “nowadays the country is becoming more of an investment destination than before.” He reports that the positive development came partly from a decrease of the flat tax from 15 to 10 percent a few years ago, which, he says, “helped make Romania a more attractive market.” Additionally, he describes the Romanian market as “full of human and natural resources that allow a certain level of investments.” Altogether Stratulat says both the market and the economy are more mature than they were in the recent past.
Among the most significant changes to the country's legislation, Stratulat says, are amendments to the Romanian Fiscal Code enacted earlier this year providing individuals with the ability to purchase more than one housing unit with a reduced VAT. The law will further “incentivize growth in the real estate market,” Stratulat reports.
When it comes to the legal market, Stratulat says that the biggest concern is the level of fees. According to him, fees have been decreasing steadily since 2008, although salaries have been increasing – which he describes as “a weird balance, mainly caused by segmentation of the market: spin-offs, emerging small firms, and new trends in client communication and management skills.” According to him, this pressure on fees effects the growth of the legal profession as it limits firms from investing in important technology. “At the same time,” he says, “there is a lot of pressure on lawyers to deliver more, as the market is built on clients’ terms.”