Should traders be concerned by the change in procedural rules?

17 July 2003 (Invest Romania)

Considered as having a specific character, requiring a simpler and expeditious judging, the commercial law cases have been granted distinctive procedural rules since the amendment of the Romanian Civil Procedure Code made in 2000 that were applied during the year 2001.

For instance, the plaintiff in a commercial law case needs to first summon the defendant for a prior direct conciliation procedure during which they would try to settle the matter before bringing it to Court. In addition, the conservatory and interim measures are taken according to specific rules. Written communications between parties are easily transmitted by registered mail. The number of court hearings must be reduced to those strictly necessary and be separated by very short terms. Parties may be assisted by experts or professionals in a certain field, besides their attorneys and the court must insist throughout the hearings for the parties to resolve the case by mutual consent. Many of the rules described above, that were put into effect for commercial claims were similar to those already applied according to various rules of arbitration.

However, one the novelties brought by the year 2000 procedural rules amendments referred to the means of contesting a commercial case judgment and the competent commercial courts. That is, the commercial courts were the County Courts (tribunale) and the Courts of Appeal, depending on the value of the claim, and the first instance commercial case judgments benefited only from a second appeal (recurs) and not also from the intermediate appeal (apel).

After less than 2 years of applying these regulations, a new reform of the procedural rules was found necessary and lead to the Government issuing the Emergency Ordinance no. 58/2003 with effect from August 28, 2003.

One of the main amendments refers to the Courts that shall rule upon commercial cases, which shall be, starting from the end of August, the Local Courts (judecatorii) - on commercial claims having a value lower than 1 billion ROL - and the County Courts (tribunale) - for commercial claims having a value exceeding 1 billion ROL, and petitions whose object could not be evaluated in money.

Moreover, regardless of the tier of the first instance court, according to the new procedural rules, a commercial case judgment may be reversed through an intermediate appeal (apel) before the Court of Appeal and with a final appeal (recurs) in front of the Supreme Court of Justice.

Following these amendments, all commercial cases shall have the chance of being judged upon by the Court of Appeal and by the Supreme Court of Justice, being the last resort court according to the Romanian jurisdiction.

Although it has been granted the power to rule upon all final appeals (recurs) in Romania, including the commercial law related cases, the Supreme Court of Justice currently has only 106 judges, which is way under the need for the number of cases expected to be brought before it. That is why measures regarding the judicial organization and increase in the number of judges at the Supreme Court of Justice and at the 15 Courts of Appeal must be rapidly taken.

The good news is that from now on, traders have the guarantee that their litigious matters may be brought before the Supreme Court of Justice, were, theoretically speaking the highly appreciated and most competent judges should rule. Also, the Supreme Court of Justice is the only court in Romania benefiting from a separate budget and administration, allowing it to better organize its activity.

Another reason for traders to feel more protected by the new procedural rules is the obliteration of the “nullification” procedure (recurs in anulare). Usually, in Romania, a court decision is considered to be final and binding only after the case has gone through both levels of appeal. In addition to these ordinary procedures, the law provides for two extraordinary appeals. One of these is the “nullification” procedure (recurs in anulare). This procedure commences at the initiative of the General Prosecutor itself or at the request of the Minster of Justice acting through the General Prosecutor, who could request the Supreme Court of Justice to “nullify” a final decision of a court, based on limited grounds and during 1 year from the date the final decision was rendered. The existence of the “nullification” procedure (recurs in anulare) was criticized by the European Court of Human Rights in Strasbourg, for the reason that it affected the principle of legal certainty and the “irreversible” character of final and binding court decisions, especially when considering that the General Prosecutor is subordinated to the executive power and may become subject to political inferences of any sort.

Although this extraordinary proceeding shall be no longer applicable starting from the end of August, the court decisions that have been rendered before this date shall still be subject to all the means of contestation existing at the date of their rendition, but, hopefully, the General Prosecutor shall no longer decide to exercise the “nullification” procedure (recurs in anulare).


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