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BRH Successfully for Monsson Group on Tax Challenge Before Romanian High Court of Cassation and Justice

BRH Successfully for Monsson Group on Tax Challenge Before Romanian High Court of Cassation and Justice

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Berechet Rusu Hirit has successfully represented the Monsson Group, a green energy producer and owner of two wind farms in Constanta, Romania, in front of the the country's High Court of Cassation and Justice in a tax dispute.

According to BRH, the High Court suspended a "pole tax" decision by the Central Tax Commission and ruled that, from a fiscal standpoint, wind turbine towers qualify as - and can be taxed as - buildings.

BHR Partner Madalina Berechet commented: "The HCCJ solution suspending Decision 5/2014 is an important step towards normality. The building tax charged for the pole of the wind turbine was retroactively applied by the tax authorities, starting from the reception date, even though such date was prior to the entry into force of the administrative decision being suspended. Therefore, large amounts were calculated and charged to the wind farms owners. The collection policy was, in most cases, extremely aggressive, with local tax authorities starting enforcement procedures against some large operators on the renewable energy market."

BRH Partner Valentin Hirit added that: "Following the Hight Court ruling, the local tax authorities will hopefully no longer establish a building tax on the wind turbine towers. We also expect the High Court to confirm the decision of Bucharest Court of Appeal invalidating the interpretation from the Central Tax Commission, with the effect of abandoning the practice of local tax authorities imposing building tax on the towers of the wind turbines. This practice has led, over the past four years, to a legally and fiscally unacceptable status quo that generated uncertainty among wind farm operators and destabilized the market."

Berechet Rusu Hirit’s team included Partners Madalina Berechet and Valentin Hirit and Attorney at law George Veziteu.

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Țuca Zbârcea & Asociații is a full-service independent law firm, employing cross-disciplinary teams of lawyers, insolvency practitioners, tax consultants, IP counsellors, economists and staff members. It also operates a secondary law office in Cluj-Napoca (Romania), and has a ‘best-friend’ agreement with a leading law firm in the Republic of Moldova. In addition, thanks to the firm’s dedicated Foreign Desks, the team provides the full range of services to international investors seeking to gain a foothold or expand their existing operations in Romania. Since 2019, the firm and its tax arm are collaborating with Andersen Global in Romania.

Țuca Zbârcea & Asociaţii is providing legal services in every aspect of business, covering all major areas of practice: corporate and M&A; litigation and international arbitration; corporate tax; public procurement; TMT; employment; insurance; banking and finance; capital markets; competition; healthcare and pharmaceutical; energy and natural resources; environmental; intellectual property; real estate; regulatory legal services.

Țuca Zbârcea & Asociaţii is a First-Tier law firm in all international legal directories and a multiple award-winning law firm both locally and internationally. It received the CEE Deal of the Year Award (DOTY Awards 2021) and the Law Firm of the Year Award: Romania (IFLR Europe Awards 2021). 

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