New Fiscal Code Impact for capital market players Dan Bădin Partner in charge Bucharest, 24 September 2015

Agenda 2 I. Tax impact for listed entities II. Tax impact for investors Legal entities Individuals © 2015,for more information, contact Deloitte Romania

I. Tax impact for listed entities © 2015, for more information, contact Deloitte Romania 3 New Fiscal Code VAT – reduction of rates 2016: 20% 2017: 19% Stock Option Plans Extension of applicability Deferral of taxation in all cases until sale of shares No salary taxes due by the company Special construction tax Eliminated starting with 2017 Fiscal incentives - update R & D – non-realization of objectives Reinvested profit – extended to more categories of assets

Capital gain (sale of shares) Interest Income received from Romania Dividends R/N: 5% WHT starting from 2017 R: Dividend income received from Romanian companies - non-taxable N: Applicability of tax on a net base (income minus expenses) => WHT refund opportunity N: Exemption for corporate bonds (public offer) N: No real-estate clause (sale of entities owning land & building) N: Tax compliance (direct registration for non- residents permitted *June 2014) R/N: Exempted share sale under the participation exemption (10% ownership for minimum 1 year) R: Reevaluation of shares – deductible/taxable under the participation exemption (10% ownership for minimum 1 year) II. Tax impact for investors - legal entities Definitions/ Concepts Fiscal transparent entity R/N: Each participant is taxed separately ! UCITS – exempted Romanian - “R” Non-resident – “N”

© 2015, for more information, contact Deloitte Romania 5 Securities lending Income non-taxable: the transfer of property over the lended securities at the moment of transfer from the borrower to the lender and vice versa New deductible expenses for capital gain computation: costs related to the transfer of property for the securities lending based on justifying documents Short selling Gain/loss derived: the positive / negative difference between the sale price and the tax value of the securities, diminished with the costs related to the transaction and to the securities lending Taxable moment: the date when the short selling is made Gold price index Income from such transactions is determined: Capital gain/loss: the positive/negative difference between the sale price and the tax value, including the cost of the transaction Taxable moment: date when the transaction is made / the payment is made, depending on the intermediary Capital gains computation Annual taxable capital gains can be diminished with the cost related to the transactions that can not be directly allocated to each transaction III. Tax impact for Romanian investors – individuals

Contact 6 © 2015,for more information, contact Deloitte Romania Dan Badin Partner in charge Tel

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