Romania Transfer Pricing Documentation Requirements 2026

Romania Transfer Pricing Documentation File Requirements 2026: A Comprehensive Guide for Foreign Investors

Introduction: Navigating Romania's Transfer Pricing Landscape

Foreign direct investment in Romania continues to grow, attracting multinational enterprises (MNEs) seeking access to its strategic location, skilled workforce, and developing market. However, with this growth comes increased scrutiny from the Romanian tax authorities, particularly concerning intercompany transactions and transfer pricing. For MNEs operating in Romania, understanding and meticulously complying with the Romania transfer pricing documentation file requirements 2026 is not merely a formality but a critical component of risk management and long-term success. This guide is designed to provide foreign investors and entrepreneurs with information about these regulations.

Our aim is to demystify the legal framework, offer practical advice, highlight crucial deadlines, and explain the severe consequences of non-compliance, ensuring your Romanian operations remain fully compliant with national and international tax standards.

The Legal Framework: Foundations of Transfer Pricing in Romania

Romania’s transfer pricing regulations are primarily anchored in the Fiscal Code (Codul fiscal), Law No. 227/2015, and further elaborated by specific implementing norms. The core principle, consistent with OECD guidelines, is the arm's length principle. This means that transactions between related parties must be conducted under conditions, including price, that would have been agreed upon by independent enterprises in comparable transactions under comparable circumstances. The documentation requirements are designed to allow the tax authorities to verify adherence to this principle.

Key legislation and norms include:

• Law No. 227/2015 concerning the Fiscal Code (Codul fiscal), particularly Articles 11 and 108, which establish the arm's length principle and the obligation to justify transaction prices between related parties.
• The applicable legislation regarding the transfer pricing file (Ordinul Președintelui ANAF nr. 442/2016) provides detailed guidance on the content and structure of the transfer pricing documentation file.
• OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations are implicitly referenced and considered by Romanian tax authorities when interpreting national regulations.

These legislative acts collectively mandate that Romanian entities engaged in related-party transactions maintain robust documentation justifying the arm's length nature of their dealings.

Who Needs to Prepare the Transfer Pricing Documentation File?

Not all Romanian entities are subject to the same level of transfer pricing documentation requirements. The obligation to prepare a full transfer pricing file, as defined by the applicable legislation, hinges on specific thresholds related to the value of intra-group transactions. It's crucial for foreign investors to correctly identify their reporting obligations.

According to Article 3 of the applicable legislation, the obligation to prepare the transfer pricing file applies to:

For small taxpayers and medium taxpayers below the thresholds, while a full transfer pricing file might not be explicitly mandated for submission, they still bear the fundamental obligation to demonstrate the arm's length nature of their related-party transactions upon request from the tax authorities. Therefore, a simplified internal justification is always recommended.

Key Thresholds for Medium Taxpayers (as per current legislation, subject to minor annual indexation for 2026):

• Financial transactions (interest, commissions, etc.): Exceeding EUR 200,000 (or RON equivalent) in total per type of transaction group (e.g., all loans together).
• Service transactions: Exceeding EUR 250,000 (or RON equivalent) in total per type of transaction group (e.g., all marketing services).
• Goods transactions (tangible and intangible assets): Exceeding EUR 350,000 (or RON equivalent) in total per type of transaction group (e.g., all raw material purchases).

Practical Advice: Even if your entity falls below these thresholds, preparing at least a minimal transfer pricing analysis and documentation is a prudent risk management strategy. This shows good faith and provides a defense in case of a tax audit, even if a full file is not mandatory.

Content of the Transfer Pricing Documentation File: 2026 Requirements

The structure and content of the transfer pricing documentation file in Romania follow the OECD's three-tiered approach: Master File, Local File, and Country-by-Country Report (CbCR). However, for most Romanian standalone entities or subsidiaries, the focus will be on the Local File and, if part of a large MNE, the Master File.

A. The Master File (Dosarul agregat al grupului)

As per Article 2, para. (1), lit. a) of the applicable legislation, the Master File provides a high-level overview of the MNE group's global business, its overall transfer pricing policies, and the allocation of income and economic activity among its members. It usually contains:

• Organizational structure: Chart illustrating the MNE's legal and ownership structure.
• Description of the MNE's business: Nature of the business, key drivers of profit, supply chain, important service arrangements, and R&D activities.
• MNE's intangibles: Overall strategy, ownership of key intangibles, and transfer pricing policies related to intangibles.
• MNE's financial and financing activities: How the group is financed, significant financing arrangements.
• MNE's financial and tax positions: Consolidated financial statements, tax rulings relevant to transfer pricing.

Requirement: A Master File is typically prepared by the ultimate parent entity of the MNE group and provided to the Romanian subsidiary. The Romanian subsidiary is then responsible for ensuring its availability upon request.

B. The Local File (Dosarul individual al contribuabilului)

This is the core document for most Romanian entities and specifically addresses the Romania transfer pricing documentation file requirements 2026. As per Article 2, para. (1), lit. b) of the applicable legislation, the Local File provides specific information relevant to the Romanian entity's intercompany transactions. It must include:

1. Entity-specific information:

• Description of the management structure.
• Detailed business strategy, including significant business restructurings or transfers of intangibles.
• Competitor and market analysis.

2. Information on controlled transactions:

• Detailed description of specific material controlled transactions (e.g., sale of goods, provision of services, loans, licenses).
• Identification of the related parties involved in each transaction.
• Copies of intercompany agreements.
• Functional analysis (functions performed, assets used, risks assumed) for both the Romanian entity and its related counterparties.
• Characterization of the Romanian entity (e.g., limited risk distributor, routine service provider, full-fledged manufacturer).
• Economic justification for the selection of the most appropriate transfer pricing method (e.g., CUP, Resale Price, Cost Plus, TNMM, Profit Split).
• Description of the comparability analysis, including database search criteria, selected comparables, and adjustments made.
• Application of the chosen transfer pricing method and determination of the arm's length range.
• Conclusion on whether the controlled transactions are within the arm's length range.

3. Financial information:

• Annual financial statements of the Romanian entity.
• Relevant segment financial data for the controlled transactions.
• Sources of financial data used in the analysis.

C. Country-by-Country Report (CbCR)

This report, mandated by Law No. 207/2015 regarding the Fiscal Procedure Code, Article 291^1, and further supplemented by ANAF Order No. 3737/2016, applies to MNE groups with consolidated group revenue exceeding EUR 750 million (or RON equivalent) in the fiscal year immediately preceding the reporting fiscal year. The CbCR provides tax authorities with information relating to the global allocation of income, taxes paid, and certain indicators of economic activity among tax jurisdictions in which the MNE group operates. The reporting entity for CbCR is typically the ultimate parent entity, which then files it in its country of residence, with information exchanged automatically with Romania.

Preparing the Transfer Pricing Documentation File: Step-by-Step Guidance and Practical Advice

Legal Deadlines and Submission Process

Understanding and adhering to deadlines is paramount to avoiding penalties related to Romania transfer pricing documentation file requirements 2026.

Unlike tax declarations, the transfer pricing documentation file (Master File and Local File) is generally not filed proactively with ANAF. Instead, it must be prepared and available at the Romanian entity's registered office.

Key Deadlines:

• Availability: The transfer pricing documentation file must be prepared and available at the company's registered office at the time of filing the annual corporate income tax return or within the legal deadline for preparing annual financial statements, whichever is later. For entities with a calendar fiscal year, this typically means by June 25th of the following year (e.g., for the 2025 fiscal year, by June 25, 2026).
• Legal basis: Article 4, para. (1) of the applicable legislation states: "The transfer pricing file is prepared and kept at the domicile, respectively at the registered office of the taxpayer, at the date of filing the annual corporate income tax return."
• Submission upon Request: The file must be submitted to the tax authorities within a maximum of 10 calendar days from the date of a formal written request during a tax audit. This deadline can be extended by a maximum of 30 days upon a justified request from the taxpayer before the initial 10-day period expires.
• Legal basis: Article 4, para. (2) and (3) of the applicable legislation.

CbCR Filing Deadline (for ultimate parent entities):

• The CbCR must be filed within 12 months of the last day of the reporting fiscal year of the MNE group. For a calendar fiscal year, this means by December 31st of the following year (e.g., for the 2025 fiscal year, by December 31, 2026).
• Legal basis: Article 291^1, para. (5) of Law No. 207/2015 (Fiscal Procedure Code) and ANAF Order No. 3737/2016.

Consequences of Non-Compliance: Penalties and Fines

Failure to comply with the Romania transfer pricing documentation file requirements 2026 can lead to significant financial penalties and increased scrutiny from tax authorities.

A. Administrative Fines for Not Submitting Documentation

As per Article 337 of Law No. 207/2015 concerning the Fiscal Procedure Code, non-compliance includes:

• Failure to submit the transfer pricing file upon request: Fines range from RON 500 to RON 100,000 (approximately EUR 100 to EUR 20,000, subject to exchange rate fluctuations) for legal entities. The specific fine depends on the volume of transactions and the tax category of the taxpayer (large, medium, small).
• Submission of incomplete or incorrect documentation: Similar fines may apply if the submitted documentation is deemed substantially inadequate, making it impossible for the tax authorities to verify the arm's length principle.
• Legal basis: Article 337, para. (1), lit. a) and b) of Law No. 207/2015.

B. Tax Adjustments and Related Penalties

The most severe consequence is the potential for transfer pricing adjustments. If tax authorities determine that transactions were not conducted at arm's length, they can adjust the taxable base of the Romanian entity, leading to:

• Additional Corporate Income Tax: The company will be liable for the difference in tax resulting from the adjustment.
• Late Payment Interest: Accruing daily on the unpaid tax amount, as defined by Article 174 of Law No. 207/2015. The interest rate is currently 0.02% per day.
• Late Payment Penalties: Applied in addition to interest, typically 0.01% per day, as defined by Article 176 of Law No. 207/2015.
• Contravening Fines: Beyond the initial administrative fines, if the tax adjustment is substantial, further fines for tax non-compliance may be levied.

Comparison of Transfer Pricing File Types

To further clarify the requirements, here is a comparison table outlining the key differences between the Master File, Local File, and CbCR relevant for Romania transfer pricing documentation file requirements 2026.

Costs Associated with Transfer Pricing Documentation

The costs for preparing a transfer pricing documentation file can vary significantly based on the complexity of the MNE group, the number and nature of related-party transactions, and the chosen service provider (in-house vs. external consultant).

• External Consulting Fees: For a robust Local File, expect fees to range from EUR 5,000 to EUR 25,000+ per fiscal year, depending on the volume and complexity. These fees typically cover the functional analysis, market research, benchmarking study, and drafting of the report. The Master File, if required to be reviewed or prepared, would be an additional cost.
• Internal Resources: If prepared in-house, costs include staff time, access to transfer pricing databases (subscriptions can be costly), and training.
• Potential Audit Costs: In the event of an audit, there will be additional costs for tax advisory services to defend the transfer pricing position.

Practical Advice: View transfer pricing documentation as an investment in compliance and risk mitigation rather than a mere cost. A well-prepared file can save your company from significantly larger tax liabilities, interest, and penalties in the long run.

Frequently Asked Questions (FAQs)

1. What is the primary purpose of Romania transfer pricing documentation file requirements 2026?

The primary purpose is to demonstrate to the Romanian tax authorities (ANAF) that transactions between your Romanian entity and its related parties are conducted at arm's length, meaning at prices or conditions that independent enterprises would have agreed upon in comparable circumstances. This prevents profit shifting out of Romania.

2. Do small taxpayers also need a transfer pricing file in Romania?

While small taxpayers are not explicitly mandated to prepare a full transfer pricing file as defined by the applicable legislation unless they exceed specific thresholds for medium taxpayers, they are always subject to the arm's length principle. It is highly advisable for them to maintain internal documentation justifying their related-party transaction prices upon request during a tax audit. ANAF can always request such justification, regardless of company size.

3. What if my Romanian entity has only one related-party transaction with very low value?

If the total value of that transaction type (e.g., all services) falls below the thresholds for medium taxpayers (e.g., EUR 250,000 for services), a full transfer pricing file might not be mandatory. However, the arm's length principle still applies. We recommend preparing at least a concise justification or memo internally to demonstrate compliance, which can be presented if ANAF requests clarification.

4. Can the transfer pricing documentation be prepared in English?

Yes, according to Article 4, para. (1) of the applicable legislation, the transfer pricing documentation file can be prepared in Romanian or in English. However, ANAF may request a certified translation into Romanian if deemed necessary for verification. It’s practical advice to have an English version readily available but be prepared for translation costs if requested.

5. What are the main risks of not complying with Romania transfer pricing documentation file requirements 2026?

The main risks include significant administrative fines (up to RON 100,000), transfer pricing adjustments to your taxable profit, and subsequent payment of additional corporate income tax, interest for late payment (0.02% per day), and late payment penalties (0.01% per day). This can severely impact profitability and reputation.

6. How frequently should the transfer pricing documentation be updated?

The transfer pricing documentation, particularly the Local File, should be reviewed and updated annually. While some sections (like the MNE's general business description in the Master File) might not change significantly year-to-year, the financial data, comparability analysis, and economic results for the Romanian entity's controlled transactions must be current to reflect market conditions and actual operational performance.

7. Is there a specific format or software required for the file?

No specific software or electronic format is mandated by law. The documentation should be presented in a clear, organized, and comprehensible manner, typically as a written report. It can be provided electronically (e.g., PDF) or in hard copy upon request.

8. How long should I keep the transfer pricing documentation file?

According to Article 35, para. (1) of Law No. 207/2015 concerning the Fiscal Procedure Code, accounting records and other fiscal documents must be retained for a period of 10 years, starting from the end of the fiscal year in which they were prepared. This includes the transfer pricing documentation file.