Business Review Issue 21/2012 June 11 - 17

3Q: Valentin Oeru, president of the Infoturism Association, told BR about the problems firms are facing in accessing EU funds for tourism promotion and shared some details about his organization’s latest project in Transylvania »page 3

ROMANIA’S PREMIERE BUSINESS WEEKLY

INTELLECTUAL PROPERTY

June 11 - 17, 2012 / VOLUME 16, NUMBER 21

IDEAS ARE THE MAJOR CURRENCY IN TODAY’S CLIMATE. SO HOW DO FIRMS MAKE SURE THEIR WORK ISN’T STOLEN

BY A COMPETITOR? BR CANVASSED INTELLECTUAL PROPERTY EXPERTS TO FIND OUT »PAGE 8

CASUALTIES FALL ON FLAT MARKET

NEWS

LINKS

MONEY

INVESTMENT

Late license

Future of the net

Lenders lowered

Stating their case

Telecom players are still waiting for the government to set the minimum prices for the impending 4G license auction » page 5

The principle of internet neutrality in the context of growing usage came under debate at an event held

by ANCOM and ApTI » page 6

Ratings agency Moody’s has downgraded BCR and Raiffeisen Bank as part of a larger downgrade of Austrian parent banks » page 7

The imminent end of the existing local state aid schemes has investors scrambling to finalize their plans for Romania » page 12

Photo: Mihai Constantineanu

The residential market has taken a battering in the crisis, with prices tumbling and homes remaining unsold.

Apartment complex projects such as Asmita Gardens are among the high-profile victims. BR surveys the damage »pages 10-11

www.business-review.ro Business Review | June 11 - 17, 2012

NEWS 3

NEWS in brief ENERGY Transelectrica takes out RON 125 mln loan from Citibank State-owned grid operator Transelectrica has taken out a RON 125 million (EUR 28 million) loan from the domestic subsidiary of Citibank to cover payments for the bonus scheme for high-efficiency cogeneration power production.

The loan has a five-month maturity and is guaranteed by present and future liability takeovers stemming from the contract of Translectrica and contributors for high-efficiency cogeneration.

FINANCE Moody’s downgrades Erste, Raiffeisen and UniCredit Bank Austria Ratings firm Moody’s has downgraded seven lenders in Germany and three in Austria – Erste Group Bank, Raiffeisen Bank International and UniCredit Bank Austria – because of the risk of shocks from the euro zone debt crisis and high exposure to emerging economies in Eastern Europe, including Romania. Locally Erste has a majority stake in Banca Comerciala Romana (BCR), while Raiffeisen controls Raiffeisen Bank and Bank Austria controls UniCredit Tiriac Bank.

Visa Europe launches local financial education program Junior Achievement, the NGO, will implement the financial education program Bani IQ, developed by Visa Europe and members banks in Romania, aiming to train 5,000 students in topics such as financial planning, budgets and banking activities. Only 3.2 percent of Romanians have access to financial education programs, according to Catalin Cretu, general manager for Romania at Visa Europe. He added that 14 percent of Romanians don’t have fundamental knowledge of financial services, while only 4 in 10 use banking products.

INFRASTRUCTURE Underground car park at Universitate to open in July The underground car park at Universitate Square will open on July 20, announced Sorin Oprescu, general mayor of Bucharest. The three-level lot will have a capacity of 420 for cars and 21 for motorcycles. According to Oprescu, the costs of construction and establishing the car park were EUR 8 million.

IT Huawei to boost local headcount by 200 by yearend Chinese telecom equipment supplier

3Q Valentin Oeru

Huawei plans to add 200 more people to its roster by the end of this year. The new employees will work in the firm’s Global Service Center, according to wall-street.ro. At the moment, Huawei has 600 employees, 200 of whom work in services, while the rest are in the sales, financial and marketing domains.

sultancy services from the company and are able to maintain their financial and operational independence while being part of a national network of stores at the same time, say officials.

Metro Cash & Carry Romania runs 32 stores locally, the first of which was opened in 1996.

RCS&RDS changes shareholding structure

Lidl opens store in Timisoara

Businessman Zoltan Teszari has diminished his direct participation in telecom operator RCS&RDS from 2.0 percent to 1.8 percent. Currently, RCS&RDS’s shareholders are Cable Communications Systems NV, based in the Netherlands, with 88.5 percent, RCS&RDS SA with 7.8 percent, Teszari Zoltan with 1.8 percent, 14 individual associates with 1.9 percent and two associate companies, with nominal stakes, which were not named, according to Mediafax newswire.

E-boda launches new tablet The newest E-boda tablet, the Impresspeed IPS Supreme X100, has been released on the market.

The 16 GB capacity product, which runs on Android 4.0, is estimated to sell 3,000 units. By yearend, E-boda forecasts it will sell 10,000 tablets from all models. Tablet sales will represent 20 percent of the company’s turnover.

The market is seeing an accelerated growth: in March alone, 8,000 tablets were sold, say officials. This has prompted the firm to make plans to launch three more tablets by the end of the year.

MEDIA The Economist highlights Romania’s EU fund absorption failings Romania’s ability to absorb EU funding is the subject of a recent analysis on the Eastern Approaches blog of international business publication The Economist. Romania, as “the second poorest country in the EU, continues to fail with the absorption of EU funds,” the article argues.

“At around 7.4 percent it is the state with the lowest absorption rate in the European Union. Absorption capacity is the extent to which a state is able to spend financial help from the EU in an effective and efficient way.”

RETAIL Metro’s La Doi Pasi franchise reaches 200 stores About 200 local grocery stores have taken up the La Doi Pasi (Two Steps Away) franchise since Metro Cash&Carry launched it this March.

The franchise targets small independent retailers who, alongside Horeca units, represent the firm’s main customers.

Retailers receive training and con-

Discount retailer Lidl has taken its national network to 140 stores after opening a new unit in Timisoara last week.

The discounter previously announced plans to reach 200 shops by yearend, investing up to EUR 70 million. Lidl opened 107 branches last June after having invested in rebranding the local Plus Discount supermarkets as Lidl stores.

The change took place more than a year after it bought the local low-cost chain Plus from German owner Tengelmann in February 2010.

Throughout 2011, 22 new Lidl branches were built.

SOCIAL Civil society, US Embassy react to Roma evictions in Baia Mare The forced eviction of Roma people in Baia Mare has raised public concern from many NGOs, alongside the US Embassy in Bucharest.

The Baia Mare City Hall is currently relocating the Roma population from the Craica district of the city to a commercial building previously occupied

by Cuprom, the leading copper company in Romania and one of the largest in Eastern Europe.

Cuprom operates secondary smelting, refining, casting, drawing, bunching and enameling facilities.

TOURISM Applications for rural tourism EU funds exceed budget The Payment Agency for Rural Development and Fishing (APDRP) received 2,006 applications between April 17 and May 16 for rural tourism financing through the regional development program (PNDR) for Measure 313 (the encouragement of rural tourism). The projects amount to EUR 285.6 million, exceeding the available budget of EUR 186.5 million.

Low-cost airline flydubai to enter local market this fall Dubai-based budget airline flydubai will operate four direct weekly flights from Bucharest to Dubai starting October 1, according to Mediafax. Tickets will start at EUR 440, all taxes included, and can be bought online from June 15.

Passengers can travel to Dubai or further on, as the company serves about 45 destinations in the Middle East and Asia.

president of Infoturism Association How hard is it to access EU funds for tourism promotion?

There are several steps from coming up with an idea to registering the project.

I don’t see it as an impossible process.

What is harder to do, unless one gets specialized consulting - we had to do that in the end – is implementing the project. Drafting a project just to get the financing is simpler to do. But drafting it is so that it can be easily implemented afterwards is more difficult. The greatest issue related to EU funding right now is the reimbursement of expenses.

The hiring freeze in the public sector means that those responsible for checking the projects are understaffed and have a great volume of work. In relation to this, there is also the issue of a lack of specialists in various fields.

For instance, the public employees are very good at what they do but they know little about creating and managing a website, such as was ours. This means additional questions which makes the process of reimbursements even lengthier.

What were the value and the objectives of your most recent project to promote northern Transylvania?

The project promoted 63 tourist objectives in northern Transylvania and it is part of our plan to create a national website to promote Romanian destinations which are off the beaten track. Its value amounted to about RON 860,000 (approximately EUR 195,000) and included online (www.transilvania-magica.ro) and offline (catalogues and brochures, attendance of fairs and dedicated events) promotion. This was done both locally and internationally.

What are the results?

We have met all of the objectives we set.

The website promoting these destinations reports on average 40,000 – 50,000 visitors each month. Out of this figure, I estimate that some 70 percent are Romanians and the rest foreigners. Also, the number of tourists visiting the promoted sites has gone up by 15 percent against 2009. simona.bazavan@business-review.ro

www.business-review.ro Business Review | June 11 - 17, 2012

4 NEWS RETAIL

STOCK EXCHANGE

Hornbach invests EUR 30 mln Poles apart: FP’s Warsaw listing in Timisoara store still lacking depositary link

G

erman DIY retailer Hornbach has begun work on its fifth local store which should be opened this summer in Timisoara. The outlet will have a sales surface of 22,500 sqm and requires a EUR 30 million investment. Hornbach entered the local market in 2007 and has since opened four local branches in Bucharest (three outlets) and Brasov.

The retailer’s last local opening was in December 2010.

The Romanian DIY market has been shrinking in recent years as real estate investments have plummeted.

The market is one of the most competitive at local level but, even so, Horbach managed to increase its business in 2011 against the previous year, MugurelHoria Rusu, general director of Hornbach Romania, told BR, without disclosing the actual figure. Hornbach posted a turnover of about EUR 71 million in 2010, according to data from the Ministry of Finance.

Moreover, in the first financial quarter of this year (March-May) the retailer says it reported positive results.Other international players on the local DIY market are Praktiker, Bricostore, BauMax, Obi and Leroy Merlin.

Local retailers include Dedeman, Arabesque and Ambient. Investment in new DIY units considerably decreased last year with only eight new large stores

T

The new outlet will cost EUR 30 million being opened. Out of this figure, five outlets belong to market leader Dedeman, which is owned by local businessmen Dragos and Adrian Paval. The other three were opened by French Bricostore, Austrian BauMax and French newcomer Leroy Merlin.

One of the worst affected players by the decrease of the market over the past few years has been Praktiker which saw sales go down by 24 percent in the first nine months of 2011. The German DIY retailer’s sales on the local market have been sliding since 2008. ∫ Simona Bazavan

he Property Fund (FP) is planning a secondary listing on the Warsaw Stock Exchange (WSE) by year end, but the direct link between the Romanian Central Depositary and the Polish Depositary of Securities hasn't been set up yet, so the fund is also considering an indirect link through a custodian bank in order to carry out the listing with estimated costs of EUR 2.4 million, according to FP budget estimates.

In April shareholders in the FP agreed a listing in principle and will approve the costs and listing methods at the next meeting scheduled for June 27. The FP will be advised on this transaction by a consortium comprising J.P Morgan, the investment bank, and UniCredit Group as global coordinators, and KBC Securities, the brokerage, as co-manager. The fund has capped the consortium’s fees and expenses at EUR 1 million.

The consortium advised the fund to go through a technical listing in the first stage, as investors will be attracted by placements of shares sold by existing shareholders. In order to make the shares fungible across the two markets, and to obtain sufficient liquidity in the aftermarket, the depositaries in Poland and Romania need to be linked, according to FP officials.

“Romania may face problems at a Eu-

ropean level, as it’s part of the European Union, if the central depositary does not link with the Polish one,” said Greg Konieczny, fund manager of the Property Fund, last week.

Adriana Tanasoiu, director of the Central Depositary, said this April the link with the Polish depositary could be set up after the national securities commission (CNVM) extends its regulation, which will be further replicated in the Central Depositary code. Following this procedure, a technical solution will be found to link the two depositaries.

This link would allow Romanian companies to tap into the Polish capital market, where 38 IPOs were carried out last year. The Polish depositary already has a direct link with the Sibiu Stock Exchange (Sibex) depositary. Last year, the WSE had a market capitalization of EUR 155 billion and 426 listed companies, with average daily trading at EUR 514 million. Meanwhile, the Bucharest Stock Exchange had a capitalization of EUR 16.4 billion and an average daily trading of EUR 9.2 million, with 79 listed companies.

The FP had a market capitalization of EUR 1.75 billion in April, reaching an average daily turnover of EUR 1.47 million.

FP shares fell by 1 percent to RON 0.4810 on Friday afternoon trading. ∫ Ovidiu Posirca

www.business-review.ro Business Review | June 11 - 17, 2012

NEWS 5

TELECOM

Government still to approve telecom license taxes

E

ven though Dan Nica, the minister of communications, announced last week that the government might approve on Wednesday, June 6, the bill that will set the official starting prices for the telecom licenses, this did not happen.

The bill will set in motion the multimillion euro bidding for spectrum which will reshape the market over the next 15 years.

After the minimum level of the license taxes is adopted, the next steps are as outlined below by Catalin Marinescu, president of ANCOM. “In the shortest time span (probably a few days) the result of the public consultation for the task book and the procedure decision will be established. Within a week of this, the consultative council will take place – a meeting between the authority and the operators on the market – when we will complete the two documents (the procedure decision and the task book.)

Within four weeks after the procedure decision is published in the Official Monitor – so sometime in mid-July – the operators interested in obtaining 4G mobile telephony licenses must submit their initial offer and the documents which make them eligible to participate in the auction. After this, in another three-four weeks, depending on whether there are contestations or not (so sometime in the first ten days of August), the auction rounds will actually begin. Depending on the number of rounds, we are convinced that by the end of August, the winners of the auction will be announced,” said Marinescu.

All of the bidders will have at their disposal an IT application that will help them develop their offer, and also a space where their team can do so. “All eligible participants will be trained on how to use the application. It is very simple to use and it will definitely not obstruct them,” said Marinescu.

The communications minister announced last week that the minimum prices will be those proposed by ANCOM. “The taxes are those that you all already know. We wanted to be sure about certain elements. One: that this will be an auction that respects the principle ‘whoever pays more, wins.’ Two: that it complies with EU norms, that it is a transparent process that respects what happened in large European states and we hope it will finish at the end of August or the beginning of September at the latest, so that the new license

STARTING PRICES* Licenses allocated for 15 years (2014-2029) EUR 35 million per block of spectrum in 800 MHz EUR 40 million per block of spectrum in 900 MHz EUR 10 million per block of spectrum in 1800 MHz EUR 4 million per duplex block of spectrum in 2600 MHz EUR 3 million per simplex block of spectrum in 2600 MHz

*Starting prices proposed by ANCOM must be approved by government decision

owners can start developing the 4G networks, to the joy of those who already have 4G handsets and can only look at them,” said Nica.

The minimum prices proposed by ANCOM were contested by operators such as RCS&RDS. However, the firm also told BR that it would “bid as much as necessary” to obtain what it needs. “Our strategy is to offer the best services to our customers in other frequencies as well. First of all, we are looking at gaining access to the 900 MHz bandwidth but we are also thinking about other frequencies as well,” said Valentin Popoviciu, business development manager at RCS&RDS. The authority’s response to the issue of the starting prices was: “We made a complex analysis of the prices based on what happened in Europe. We have taken into account the size of the country and the level of the tariffs in our country. So we adjusted the average prices in Europe to the

conditions in Romania. We believe that prices reflect this adaptation and also what happened on other European markets in the case of this type of auction as well.”

One important point is that after the auction, operators will be in the position to offer 4G services in Romania. “Shortly after the licenses are available we will be ready to launch 4G services. Orange has already carried out some tests for 4G and we believe that the transition to this technology can be made in a relatively short time,” Dorin Odiatiu, public affairs, partnerships and wholesale director at Orange, previously told BR. Similarly, Inaki Berroeta, CEO of Vodafone, previously said that if there is a proper distribution of the spectrum, continuity of services and predictability of investments are guaranteed and costs are reasonable, the company “will invest in and launch 4G services this year.”

Popoviciu, of RCS&RDS, said his com-

STARTING PRICES* Licenses allocated for 15 months EUR 3.4 million per block of spectrum in 900 MHz EUR 800,000 per block of spectrum in 1800 MHz

*Starting prices proposed by ANCOM must be approved by government decision pany will also be in the position to offer these services, if it gets the necessary spectrum.

“We can also start offering 4G services at the end of this year, the same as our competitors. But first of all we need to know what we can count on.” ∫

www.business-review.ro Business Review | June 11 - 17, 2012

6 LINKS

The internet, where to?

After knocking on the gates of Europe, the discourse on the future of the internet has also reached Romania, in a debate entitled the Neutrality of Networks and the Sustainability of the Internet, organized by the Romanian telecom authority ANCOM and ApTI (the Association for Technology and Internet), held last week. business development director at RCS&RDS, argues that something must be done to manage the increasing quantity of content The principle of internet neutrality, which operators must carry within their network. says that networks that provide internet access should treat equally all content, web- “There are now generators of very high traffic that networks must keep pace with. sites, platforms and applications, is being Maybe the best model would be for content challenged by a series of arguments relatsuppliers to support the cost of the upgrade ed to the need to administer the increasing of the telecom network,” said Popoviciu, amount of traffic and ensure the efficienurging that “a model must be found on the cy and sustainability of networks. long term which is sustainable and moves “The principle of internet neutrality has the internet forward.” been consecrated by law only in the NetherOne of the main conclusions of the delands, where regulations were set in place bate was that regulation at European levregarding conditions in which interventions el on the neutrality of the internet is not juscan be made for prioritizing traffic, so that tified at the moment, but interventions it does not constitute abuse. But, since studshould be different from state to state, to ies show that over the next five years reflect conditions on that market. The mintraffic in internet networks will increase ister of communications, Dan Nica, said the fivefold, there is no way around this quesgovernment would use all the tools in its artion, either in Europe or Romania: what is senal to stimulate access to internet in the best way to continue to provide free and Romania. He also announced the intention equal access to the internet?” asked Catalof the ministry to launch new e-governin Marinescu, president of ANCOM. ment services, including an electronic sysBogdan Manolea, executive manager of tem for VAT reimbursement.

ApTI, supported the idea that to preserve The three main points of view, correthe internet as it is today, the role of intersponding to the three parties interested in net service providers should be defined the neutrality of internet – content supplimore clearly as merely suppliers of interers, users and internet services providers net access, with no role in the management – were summed up by Marinescu. “Content of the content. He gave several examples in suppliers fully support internet neutrality which ISPs in Romania had exceeded their and depend on the network to lead their acremit as neutral vehicles for content.

Manolea quoted Sir Tim Berners Lee, tivity and supply their services to consumers. Representatives of users are callthe inventor of the World Wide Web, as having for the complete neutrality of neting said, “In recent years, the debate has works and ask for that to be firmly guarrestarted on whether governments should anteed by law. Internet services suppliers issue legislation to protect the neutrality of are not against the principle of internet neuthe network. They should. Although gentrality, but are confronted with a series of erally, the internet and the web flourish in an environment that lacks regulations, needs since pressure on their networks is mounting,” said Marinescu. some basic values should be protected by law.”

On the other hand Valentin Popoviciu, otilia.haraga@business-review.ro

∫ OTILIA HARAGA

Global issue: increasing internet use poses questions of networks

www.business-review.ro Business Review | June 11 - 17, 2012

MONEY 7

Moody’s downgrades Austrian lenders in Romania Ratings agency Moody’s last week downgraded Banca Comerciala Romana (BCR) and Raiffeisen Bank as part of a larger downgrade of Austrian parent banks on mounting Euro zone pressures and an anemic recovery of the domestic economy. um enterprises and micro companies, according to the agency. In addition, foreign currency lending is 62 percent of the total loan portfolio, while the poor asset quality led to a loss of EUR 70.8 million in Q1.

Raiffeisen has increased lending by 17 percent per year in the past two years, in a flat domestic banking system, which could put pressure on the asset quality from a partially unseasoned loan book, warned Moody’s.

The lender is exposed to external shocks due to its relatively high corporate borrower concentration and Raiffeisen’s level of foreign-currency loans, amounting to 44 percent of gross loans, mainly Euro-denominated.

The lender doubled its net profit in Q1 to EUR 31 million.

Moody’s last week downgraded seven lenders in Germany and three in Austria – Erste Group Bank, Raiffeisen Bank Red flag: mounting Euro zone pressures have impacted Austrian banks

∫ OVIDIU POSIRCA The Romanian economy slipped into technical recession after shrinking by 0.2 percent in the last quarter of 2011, further losing 0.1 percent of GDP in the first quarter of this year.

The country is dependent on exports and private sector capital inflows, mainly from Euro zone members that have to deal with their home grown crisis, said officials.

The rating agency reported that private consumption remained weak, while unemployment is starting to increase.

This has led to weak credit demand, lower revenues and asset-quality pressures in the banking sector.

BCR saw its long-term deposits in local cut by one notch and those in foreign currency cut by two notches, both to Ba1 with a negative outlook, while short-term deposits in local and foreign currency were downgraded to Not Prime, which is included in the speculative grade, with negative outlook.

The lender, which is majority-owned

by Austrian Erste Group, said the downgrade will have a limited impact due to its strong deposit base that allows high liquidity. Erste Group holds 93 percent of BCR and the group’s exposure in Romania has increased to EUR 8.5 billion in the last three years. BCR is the largest bank in Romania, with market shares of around 20 percent in deposits and 22 percent on loans.

The bank financial strength rating was lowered to E+ from D with stable outlook, which means that BCR may receive parental support due to the worsening domestic conditions.

Meanwhile, Raiffeisen Bank saw its long-term deposits in local and foreigncurrency downgraded by one notch to Ba1 with stable outlook, while the shortterm deposits in local and foreign currency were cut to Not Prime with stable outlook.

Raiffeisen Bank, majority-owned

by Austrian Raiffeisen Bank International (RBI), said the downgrade doesn’t reflect its financial performance, adding that the parent bank is committed to further developing its Romanian subsidiary.

The lender holds market shares of 6.5 percent in loans and 8.4 percent in deposits and has a strategic importance in the RBI group, according to Moody’s.

The bank’s financial strength rating was dropped to D- from D with stable outlook, meaning that the subsidiary may require parental support at times.

Apart from the Romanian operations of the two lenders, Moody’s downgraded Erste’s subsidiary in the Czech Republic, while affirming Hungary’s rating. Raiffeisen subsidiaries in Slovakia and Ukraine were downgraded, while Hungary was affirmed.

Loan exposure Moody’s warned that the high level of foreign-currency loans is making lenders more vulnerable to external shocks, while bad loans from underperforming companies are also putting profit under pressure.

The volume of non-performing loans for BCR had reached 22.4 percent of the total loan portfolio by March due to its large exposure to weak small and medi-

International and UniCredit Bank Austria – because of the risk of shocks from the Euro zone debt crisis and high exposure to emerging economies in Eastern Europe.

Erste Group Bank was downgraded by two notches to A3, while the ratings of Raiffeisen Bank International and UniCredit Bank Austria were cut by one notch to A2 and A3.

The rating agency also cut ratings for Commerzbank, Germany’s second largest bank by assets, and five other banks.

It will make a separate rating decision on Deutsche Bank, Germany’s largest lender. Moody’s has maintained Romania in the group of countries recommended for investments. At present, Romania has a Baa3 rating with stable outlook.

ovidiu.posirca@business-review.ro

www.business-review.ro Business Review | June 11 - 17, 2012

8 INTELLECTUAL PROPERTY

Firms come out fighting to protect intellectual property Coming up with new products and services is one of the best ways to retain and gain custom. But once you have your idea, innovative product or manufacturing procedure, how do you protect it from your rivals? Business Review talked to intellectual property specialists to find out. ∫ ANDA SEBESI “Capital isn't that important in business.

Experience isn't that important. You can get both these things. It is ideas that are important. If you have ideas, you have the main asset you need, and there isn't any limit to what you can do with your business and your life,” goes a famous quote by Harvey Firestone, the American businessman who founded Firestone Tire and Rubber Company, one of the top global makers of automobile tires.

And many agree: innovation is the most precious thing any company in the world has at present. As the competition gets fiercer from one year to another, both entrepreneurs and managers need to protect their intellectual property at all costs, as great ideas are always an attraction for both direct and indirect competition.

One of the most significant examples of ongoing innovation is Apple, which posted quarterly revenue of USD 39.2 billion and quarterly net profit of USD 11.6 billion, according to its financial results for its fiscal year 2012 second quarter ended March 31.

Its founder, Steve Jobs, who died in October last year, is known as the inventor of 212 different Apple patents in the US until the beginning of 2011. Apple has patents even for the minutiae of its business, like the iPod Nano box or iPhone package.

The pharmaceutical industry is another field where patents are very important, as drug companies make huge investments in research and development activities.

For example, Bayer, a global enterprise with core competencies in the fields of healthcare, nutrition and high-tech materials, currently has 78,000 valid patent applications and patents worldwide, 12,000 protected inventions, 6,500 patent applications a year and 750 new inventions a year.

Some 40 percent of sales are based on proprietary products or processes and a patent has a life of 20 years. Plus, it takes an average of 12 years to develop a new drug.

But what does intellectual property mean? It relates to creations like inventions, literary and artistic works, symbols, names and images used in trading activities, and includes two different concepts: industrial property and copyright.

Industrial property means inventions, trademarks, geographical indications and industrial designs and models while copyright covers literary and artistic works.

Protecting intellectual property has become increasingly important, say market players

Intellectual property rights have a huge importance to companies as they safeguard their efforts and creativity.

For Dan Boabes, CEO at Simplus, a Romanian company specialized in SMS services and applications of interactivity through SMS, intellectual property is one of the most important issues for his business.

“We all know that the Romanian IT/interactivity through SMS market is subordinated to ‘copy-paste’ rule. Why innovate when you can steal or copy?

This kind of ‘inspiration’ is choking a market that could really develop very nicely if competitors played fair,” says Boabes. He adds that intellectual theft in his field of activity can’t be stopped

just by the steps taken by serious companies that protect their creations at the State Office for Inventions and Trademarks (OSIM).

“I think that it is important also to protect the mechanisms behind these IT solutions, and here it is about patents.

Simplus intends to use patents in order to better defend its ideas from the theft it faces,” adds the CEO. Since 2004 Boabes has started to register different services (Kuplometru) and also the name of his companies (ParlaTel, Simplus).

Where is Romania on intellectual property…?

At present the national legislation on intellectual property is in line

with European law, so experts say that all the fields of intellectual property are covered satisfactorily from the legal perspective.

The OUG no. 100 / 2005 represents the transposition into the local legislation of the Directive of the Council and European Parliament 2004/48/CE. This act regulates the measures that can be taken in order to ensure intellectual property rights are respected.

There are also other norms, like Law no. 84/1998 (about trademarks, geographical indications), Law no.

69/1991 (about patents) and Law no.

8/1996 (about copyright and connective rights).

The OSIM, ORDA, IEPR and ANV are among the institutions tasked

www.business-review.ro Business Review | June 11 - 17, 2012

INTELLECTUAL PROPERTY 9 PARTNER CONTENT

IP protection promotes competitivness

Andrei Brasoveanu, managing partner, Ciurtin, Brasoveanu and Associates

with applying these laws.

“The experience of both public authorities and other players that are active on this market has increased progressively along with the volume of activity.

The activity of courts with files specific to this field and the experience of judges (some of them specialized in intellectual property) have also increased significantly in the last few years,” says AnaMaria Baciu, partner and coordinator of the intellectual property division at NNDKP. The same trend of the specialization of professionals on the local market has been noticed by Cosmin Vasile, partner at Zamfirescu Racoti-Predoiu (ZRP).

“This specialization is welcomed in the context of an increased amount of intellectual property litigation. This evolution is caused by the current economic crisis, whose effects can be felt in all the sub-divisions of intellectual property rights – copyright, patents and trademarks,” says Vasile.

Intellectual property rights are linked with the idea of economic, technical and cultural progress and the evolution of a modern society, whether we’re talking about new technological inventions or simply the promotion of new products and services.

“The protection of ideas and their originality and commercial name means ensuring legal competitiveness between the players on a market. Recent years have certainly brought increasing concern with the formal protection of intelligence and innovation, and there has been a significant flow of requests for protection addressed to OSIM or law suits that center on the protection of different intellectual property rights,” says Cristian Popescu, collaborator lawyer specialized in intellectual property and copyright at Popovici Nitu & Associates and adviser in intellectual property issues at OSIM.

ister trademarks because this is done in connection with all Euro zone countries.

Specialists say that there is a huge battle between Romanian companies and large international law firms that represent their customers worldwide.

These firms are very careful and don’t allow anyone to register a trademark of their customers even if they are not present on the local market.

According to Baciu of NNDKP, the most visible problems that both local and multinational companies are now facing from the intellectual property perspective is still the infringement of trademarks.

There are two reasons for this: this kind of intellectual property rights are probably present in most companies’ portfolios and breaking them is easiest and thus more frequent.

“But this doesn’t exclude problems for the patentees of other intellectual property rights – inventions, designs, models and copyright,” say Baciu.

According to Vasile of ZRP, the most frequent problem is counterfeiting, both of patents and trademarks.

“For example, in the pharmaceutical industry there is a battle between manufacturers of innovative drugs that hold patents and those of generics that aim to invalidate the patents in order to be able to access the market. The import of counterfeit commodities is another example.

It has increased significantly of late as a result of the international economic situation,” says Vasile. He adds that the failure to pay royalties is another cause of litigation that has increased significantly.

Elsewhere, the Popovici Nitu & Associates representative says that both Romanian and multinational companies face a few types of problems: the fight against counterfeiting/piracy, illegal use of commercial names and the delayed reaction and sometimes even ignorance over protecting intellectual property rights.

“Unfortunately and increasingly a company becomes aware of the protection of its intellectual property when it suffers di-

...and what problems do companies face?

Boabes says that since Romania’s accession to the European Union it has become more and more difficult to reg-

The registration of a Community trademark involves a single procedure to be followed and a single application referred to a single competent office and, in exchange, one obtains valid protection on the territory of 27 countries, encompassing a market which comprises more than 350 million persons. The registration of a Community trademark has the same effects in all 27 EU member states, without being conditioned by prior national registration of the trademark.

Moreover, a Community trademark application which is not accepted for registration may be turned into a national trademark application.

One should also take into account the costs of registering a Community trademark, which are considerably lower (they are paid only once) compared to the international trademark registration system based on the Madrid Agreement, in the same number of countries.

How do you perceive the evolution of the complexity of disputes concerning the counterfeiting/illegal use of trademarks, inventions and other intellectual property rights over the past years?

Free economy is based on the principle of competition and competitiveness. A successful idea, a well-known brand which attracts consumers through quality guarantee and usefulness of the products and services which the brand is associated with also provide ideas to the less honest economic players who want fast profit with minimum costs and with others’ ideas. This kind of phenomenon is inherent to a free market. Obviously, over the past years there has been an increase in the number of IPA disputes and, as for the complexity of these cases, globalization is key. In this regard, one should mention a recent litigation handled by Popsicle

Nitu & Asociatii in which an inventor of Romanian origin residing in France who had presented a product of his at an invention fair in the USA is involved in a trial against two multinational companies (a French one and an American one) in France with regard to the exclusivity of use and the authorship of the invention.

What were the most important cases in which you provided legal assistance in the intellectual property area in recent years?

1.Romanian Tennis Federation – legal assistance and representation before the State Office for Inventions and Trademarks in the claim lodged

by Tiriac Group regarding the cancellation of the registration of the “OPEN ROMANIA”/”BCR OPEN ROMANIA” trademark owned by the Romanian Tennis Federation (FRT).

2.SIVECO Romania – legal assistance regarding the opposition of SIVECO Romania against a trademark similar to the 26 commercial trademarks registered by SIVECO Romania, as well as regarding the registration of SIVECO Romania’s rights over tens of computer programs.

3.Lidl Romania – legal assistance regarding the registration of new trademarks on the Romanian territory, as well as in connection to the applicability of copyright law regarding Lidl’s advertisement materials in Romania.

4.Asseco SEE – legal assistance and representation before the State Office for Inventions and Trademarks regarding the national registration of 8 Asseco SEE trademarks.

5.Primagaz Romania – legal assistance in relation to obtaining the license for the Primagaz trademark from Primagaz France, as well as in relation to the registration of two national combined trademarks.

Main clients in recent years: ArcelorMittal, Asseco SEE, Auchan, Credit Europe Bank, Deutsche Leasing, Dorma, ECS, Romanian Tennis Federation (FRT), Fondul Proprietatea, Immofinanz, Lidl Romania, Primagaz Romania, Scandia, Shell Gas, SIVECO, Orange, Oresa Ventures.

Cristian Popescu, Managing Associate Popovici Nitu & Asociatii Attorneys at Law ADVERTORIAL

Ana Maria Baciu, partner, coordinator of intellectual property division NNDKP

What advantages does registering a Community trademark provide to your clients?

The formalities for the registration of a Community trademark obviously stand out due to flexibilCristian Popescu, Managing Associate ity and reduced costs compared to Popovici Nitu & Asociatii - Attorneys the international trademark regisat Law tration procedures based on the Madrid Agreement.

www.business-review.ro Business Review | June 11 - 17, 2012

10 INTELLECTUAL PROPERTY rectly through a decrease in its turnover.

This is because it faces unfair competition from much lower quality products that are fraudulent giving their customers the idea that they have a connection with the original products,” says Popescu.

Meanwhile, Andrei Brasoveanu, managing partner and co-founder at Ciurtin, Brasoveanu and Associates, says that the number of infringements of intellectual property rights has increased alarmingly in the field of importing and marketing industrial models that don’t have the approval of the rights-holders and counterfeiting products, using documents at customs that don’t indicate the origin of the trademark.

“Another type of litigation is using the names of domains from the virtual informatics space, in general for cases when someone different from the holder of the trademark registers and eventually uses a domain with the same name in the Romanian Register of Domains (RMC),” says Brasoveanu.

What can companies do?

Specialists say that the careful monitoring of the potential infringement of intellectual property rights and following the procedures to register them are the best way to protect intellectual property capital.

Vasile of ZRP argues that in order to prevent such situations, companies whose intellectual property rights are at risk need to use a specialized law firm or industrial property advisers

The benefits of protecting your intellectual property l You prevent unfair competition; l You protect your work and investment; l You behave responsibly in regard to your employees and their work for your company; l You have a strong argument against those who accuse you of being unfair; l The judicial protection of new creations encourages investment and generates new innovations; l Promotion and protection of intellectual property foster economic growth and create new jobs and activities; l Consumers couldn’t buy your products and services with trust if your trademark were not sufficiently protected.

in order to monitor the publications and official registers and see if there is any risk of third parties contravening their rights.

“Where such infringements have oc-

www.business-review.ro Business Review | June 11 - 17, 2012

curred we recommend companies retain specialized law firms because of the high degree of technicality of this issue,“ says the representative of ZRP. According to Popescu of Popovici Nitu & Associates, protecting intellectual property involves two steps: preventive protection by registering patents, trademarks and industrial designs in the geographical area where a specific company operates, and offensive protection before organizations like OSIM, OHIM, WIPO, or in court to challenge patents and trademarks, and block the illegal production/commercialization/use of some logos or products bearing them.

For example, a start-up first needs to register its own internet domain and that needs to be backed up by the registration of as distinctive as possible a name that reflects, at least in part, the web address.

“If the company is going to produce things it is compulsory to register the rights to the patent or industrial designs for the products and technical methods of production,” says Popescu.

He adds: “Similarly, when a company notices that its products and services are suffering unfair competition (by counterfeiting or false advertising) it needs to react immediately through notifications sent to the unfair competitor.

If the illegal actions don’t stop the next potential step is to sue and complain to the authorities.”

Elsewhere, Boabes warns that if the market on which he operates was a fair one, registering a trademark wouldn’t be necessary.

“In such a context where you launch a product, invest in its promotion, make it profitable and then you see it copied with only minor differences from the original a short time after doing it, it is very important to protect it. We know it is a worldwide phenomenon but we are very vigilant and we severely penalize any attack against the integrity of products and services created in the laboratories of Simplus.”

He adds that the examples given by artists, writers and inventors who took a stand against intellectual theft should make Romanians respect their work and protect it.

INTELLECTUAL PROPERTY 11 Intellectual property market is growing A specific trend on the local market is that many law firms have decided to focus more on legal services for intellectual property, with several of them having had these services in their portfolio since entering on the local market.

For example, the intellectual property division of NNDKP was created back in 2003 when the need for specialization from some lawyers in this field of activity was obvious.

“Since then, our team has constantly grown, both in terms of members and volume of activity and experience,” says Baciu. She adds that specific intellectual property services made up about 7 percent of the total turnover registered by NNDKP in 2011.

Meanwhile, the intellectual property department of Popovici Nitu & Associates was founded more than ten years ago, but as a result of the significant increase in demand and projects in the past two-three years it is in the process of expanding and consolidation.

According to Popescu, 2 percent of the total turnover posted by the law firm comes from specific services for intellectual property.

Elsewhere ZRP is one of the most important players on the Romanian intellectual property market and offers judicial assistance and representation in intellectual property litigation and a wide range of legal services to protect intellectual property.

“Intellectual property makes up a significant weight in our income and is directly proportional to the success of our customers in protecting these rights. The percentage of the income in our area of business both from consultancy and litigation is in double digits,” says Brasoveanu.

Ciurtin, Brasoveanu and Associates has developed and consolidated its practice in intellectual property rights since 2003.

The company has honed its methods in this regard by successfully developing registration and patenting procedures for the benefit of its customers and has drawn up protective contracts to safeguard its clients’ business.

anda.sebesi@business-review.ro

A short guide to intellectual property Patent = confers the exclusive right to an invention – a product or procedure – that offers a new way of doing something or bringing a new technical solution to a problem. It guarantees the holder the protection of his or her invention for up to 20 years Trademark = a distinctive sign that indicates that products or services are produced or supplied by a specific individual or company Design or industrial model = represents the aesthetic or ornamental appearance of an object. According to the majority of national legislation, a design or industrial model needs to be new or original and not to have a technical function in order to secure protection Geographical indication = sign used on products that have a precise geographical origin and that have some qualities or renown resulting from the origin

Source: State Office for Inventions and Trademarks (OSIM)

How to protect intellectual property All businesses have intellectual property (IP) regardless of their size or sector. IP can mean a brand, invention, design or other kind of creation, and it can be legally owned.

Your IP is a valuable asset. SeCosmin Vasile, curing and Partner Zamfirescu protecting it could Racoti Predoiu be essential to your business’ fuAttorneys at Law ture success, so it is vital to understand your rights and how the law can help you.

Here are some key issues related to costs, time and procedure for protecting IP rights.

The enforceability of intellectual property rights Romania has a legal system which is aligned to that of the EU in what regards the matter of intellectual property rights and the enforceability thereof. We hereby mention the Government Emergency Ordinance no.

100/2005 which constitutes the implementation into the national law of the European Parliament and Council Directive 2004/48/CE. This Ordinance regulates the measures that can be taken in order to ensure the enforceability of intellectual property rights and represents the main legal provision in the matter. It institutes several legal and judicial procedures that are aimed at providing a quick and effective remedy in case of any infringement.

Regarding the interim injunctions in order to prevent any further violation, the Romanian Law offers a series of procedural means, provided that the plaintiff produces minimum evidence of the alleged infringement. It is often complicated to obtain such proof at a very early stage and the decision to be issued by the Court is most likely to be influenced by the lodged evidence or lack thereof. It is also of utmost significance to point out that the decision is the result of the judge’s subjective interpretation of the law and evidence submitted, as legal precedents are not binding in the Romanian law system.

The duration and costs for a case related to infringement of the intellectual property rights Generally, the competence of the Romanian Courts is determined by the domicile or headquarters of the defendant. However, in what regards counterfeited trademarks or patents or requests for annulment of such, the competence belongs to the Courts sit-

uated in Bucharest. The judges presiding at the Bucharest Courts are highly specialized in intellectual property matters and have a very vast experience in such cases and a good understanding of the problem.

In what regards the costs of the possible judicial procedures, the law stipulates fairly small and fixed taxes for the actions aimed at preventing or stopping any infringement. On the other hand, the claims for damages caused by such violations require higher costs that are calculated based on an algorithm dependent upon the value of the claim, in the sense that taxes are somewhat proportional to the amount requested.

Regarding the duration of the legal proceedings, although the situation is not as dramatic as in other European countries (e.g. Italy), it is not uncommon for the procedure to last up to two or three years in the first instance, especially if an expert’s report is required by the case. Together with the two appeals usually permitted by the civil procedure, a case might require up to 4-5 years for a definitive solution to be issued.

The solution on the merits is grounded mainly on the expertise report’ conclusions It is a fact that in some cases, to some extent, the role of the lawyers and of the judges is limited. Due to the technical character of the most of the cases related to infringement disputes, the Romanian courts usually appoint an expert or a panel of experts for the determination of the technical aspects raised within the claim for infringement. One can say that it is almost a rule that in cases related to patent infringement, an expertise report is administered. Each parties may appoint an expert counsel, who takes part to the expertise and watches the party’ interests. When rendering the decision, the court relies almost entirely on the conclusions on the expertise report, although, the relevant procedural rule provides that the court should only be bound by the expert’ findings and not by the expert’ conclusions as well.

As a conclusion, if you want to be comfortable that you have taken all measures for protecting your IP rights, you should seriously consider the possibility of obtaining specialized assistance from lawyers or specialized counsels.

Cosmin Vasile, Partner Zamfirescu Racoti Predoiu Attorneys at Law ADVERTORIAL

Copyright = a group of laws that give protection to authors, artists and other creators for their literary and artistic works, generally named “creations”

PARTNER CONTENT

www.business-review.ro Business Review | June 11 - 17, 2012

12 INVESTMENT

End of state aid scheme gets greenfield investors going Investors who remain confident in Romanian profitability but who have been hit hard by the crisis are scrapping it out to get their hands on the remaining state aid, as by the end of 2013 the existing schemes will shut up shop. BR finds out more.

Courtesy of Alinso

First site: applications for state aid have increased over the last couple of years, with western Romania a big recipient

∫ ANDREEA CEASAR “The Romanian state aid that both of our newest investments recceived played an essential role in selecting the two locations in Romania. Without this support, Bosch would not have decided to invest in Romania,” says Brigitte Elba, Robert Bosch’s general manager, of the company’s EUR 120 million investment plan in Cluj and Blaj.

Following these investments, the production unit in Blaj will be expanded by more than 21,000 sqm, absorbing an investment of EUR 43 million, while a new production facility will be opened in Cluj, requiring the other EUR 77 million.

Both projects will create approximately 450 new jobs. The company was approved for state aid of EUR 13.4 million for its Blaj investment and another EUR 25.9 million for the new Cluj factory.

The view of Bosch is shared by many other investors which at the moment – when the markets are suffering from the third financial blockage in the last two years – cannot and would not invest large amount of money in an Eastern European country unless the local authorities offer some financial benefits.

“During this period, when everything has stopped because of Greece, Spain and Italy’s financial situations, the only play-

ers that will continue their investment plans are the ones that are already present on the local market and know how it works and its potential. Moreover, the majority of investors aim to benefit from state aid schemes such as Government Decision (GD) 1680/2008 which can reimburse up to 50 percent of all an investment’s eligible costs if the investment is larger than EUR 5 million and creates more than 50 jobs,” says Nicolae Popa, business development director of the French subsidiary GSE in Romania, a turnkey contractor that this year obtained two major contracts: a factory of 10,000 sqm in Timisoara for the automotive supplier MGI Coutier, and a 28,000-sqm plant and office space in Oradea for the American telecom and electronic equipment manufacturer Plexus.

The rising interest in this type of scheme can be seen by analyzing official figures. According to the Ministry of Public Finance (MPF), through the two main state aid schemes (conceived to encourage large investments under GD 1680/2008 and GD 753/2008) 24 financing agreements have been signed for investments of over EUR 1.1 billion in domains such as car and automotive components manufacturing, research and development for the automotive sector,

production of components for irrigation, production of components for the aircraft industry, energy production, tourism and healthcare. State aid of EUR 296 million made possible the creation of over 6,300 jobs.

The number of requests for these types of schemes has increased considerably from 2010 to 2012. While in 2010 there were only 24 requests for GD 1680/2008, from which just two beneficiaries obtained it, the next year the number of requests doubled to 51 and approved state aid of EUR 80.1 million reached 11 beneficiaries. By the end of this May approximately the same number of companies that had applied throughout the whole of 2010 had been recorded and more than one third had obtained aid of EUR 86 million. Of all 21 investments that received grants, more than half are in the western part of the country, while the rest are near Bucharest or Prahova.

“This is the first time when we have applied for state aid in Romania and we were pleasantly surprised to see the involvement of the Ministry of Public Finance in helping us make the application. The scheme GD 1680/2008 is very good and clear in terms of rules, in comparison with other countries where the less advantageous option of

tax exemptions is preferred,” says Elba.

According to Alin Buftea, partner and head of DLA Piper’s Romanian real estate practice, in Slovakia the main aid forms applied are: subsidies for acquiring goods, income tax exemptions, transfers of ownership of a property below market price, and state contributions to creating new jobs. In the Czech Republic it runs from tax reductions to financial support, while in Poland state aid is provided in the form of grants for investments and property tax exemptions.

“In Romania, specific individual allocations are granted only after the companies selected for state aid have made some of the eligible expenses for the investment. This measure is a guarantee that the approved investment will take place and is a measure to protect the Romanian state against situations in which sums of money are delivered and then, for various reasons, the investment is halted,” says Buftea. However, the investor may ask for part of the sum allotted by the scheme. In this way, the investor will have to support only some of the eligible costs of the project until it is finished, as these costs will be covered by payments from the state, as performing investments.

“For investors it is very interesting to invest in this way, reducing the costs of investment by approximately 50 percent, as there are very few players that can and will bring all the money. But unfortunately the relationship between banks and investors is tough, and there are investors that even though they have obtained state aid cannot start the project as they cannot come with their part of financing,” admits Popa.

“The state aid percentage is determined by reference to the eligible costs.

Although the percentage may go up to 50 percent, in reality the investment costs are generally higher than the eligible costs, which means that the 50 percent would be substantially diminished by reference to the actual cost of the entire investment,” cautions Buftea.

Currently the MFP is analyzing 14 investment projects in different sectors that have sought aid: industry (production of plastics, automotive, manufacturing high and low voltage cables, manufacturing of rolling stock, machine oil), tourism and healthcare.

The value of these projects would be EUR 364.4 million, and the requested aid is EUR 141.1 million. If they are accepted and secure banking support, there could be a warm breeze over the frozen markets.

andreea.ceasar@business-review.ro

www.business-review.ro Business Review | June 11 - 17, 2012

PROPERTY 13

Asmita Gardens’ creditors count losses after residential crash Insolvent Asmita Gardens hopes to get around EUR 45 million for the final batch of 361 apartments delivered last week, after lowering its expectations to EUR 900-950 per sqm. The company’s debts, however, amount to EUR 110 million and there is no positive sign for the market on the horizon.

Prices for the remaining flats start at EUR 52,000 for a studio and reach EUR 200,000 for three-bedroom apartments.

The complex also features penthouses, commercial spaces and underground parking.

The next step in the project’s insolvency case will be for Euro Insol and Alpha Bank to file the reorganization plan within 30 days of filing the final table of claims which should happen this week, said Borza said.

Flat future for the residential market Photo: Mihai Constantineanu

Not all rosy in the garden: Asmita Gardens was a victim of the property crash

∫ SIMONA BAZAVAN Back in 2007 the pre-sale rate of apartments in the high-rise apartment tower complex Asmita Gardens in Bucharest reached one flat a day. Generously spaced one-bedroom apartments came with a price tag of up to EUR 130,000 but, even so, the upward trend seemed like a oneway street.

Come the crisis, and the Asmita Gardens complex story has become a cautionary case study of the rise and fall of the local residential market.

The project, which at EUR 127 million invested and 758 apartments built is the largest residential real estate investment in Romania, was officially delivered last week although the construction of the seven towers was completed two years ago.

Asmita Gardens is owned in equal share by Indian company Asmita and the Charlemagne investment fund. It went insolvent in November 2011 following construction litigation with the project’s general contractor, Austrian Strabag. That year, Asmita Gardens posted RON 183 million of losses, according to Remus Borza, managing partner of Euro Insol, the project’s judicial administrator.

It hadn’t sold a single apartment since October 2010, he disclosed.

Since November 2011, 34 apartments have been sold, a satisfactory rate, thinks Borza, given the general market conditions. At present about five apartments are sold each month but the figure can reach eight, he added.

While prior to the crisis the price per

square meter was EUR 1,600, the company has now lowered its expectations to around EUR 900-950 per sqm.

Given that there are 361 apartments in the project, Borza estimates that their sale could bring in about EUR 45 million.

However, Asmita Gardens has EUR 110 million of debt. Its largest creditor is the local branch of Greek Alpha Bank, which is owed EUR 70 million, followed by the two owners with EUR 16 million each.

“Obviously, everyone stands to lose money,” said Borza, adding that only Alpha Bank can recover some share of the debt, although in his opinion it will be “a far cry” from the initial figure invested and not taking interest into account.

Present at the press conference to mark the inauguration event, Periklis Voulgaris, vice-president of corporate banking at Alpha Bank Romania, was more optimistic and said his bank hopes to recover all of the debt. In his opinion prices could go up even through at present there isn’t much of a market outside the Prima Casa scheme, as there are no new projects in the pipeline.

In order to stimulate the interest of prospective buyers, Alpha Bank is preparing a special credit product, added Voulgaris.

The Asmita Gardens project is located near the Dambovita River, in southeast Bucharest. The complex consists of seven towers, five of which are16 floors high, one reaches 20 floors and one 24 floors with a total surface of 70,000 sqm.

There isn’t much room for optimism when it comes to the evolution of the real estate market this year, players agree.

The prices of new apartments in Bucharest will most likely continue to tumble throughout 2012, falling even further after having decreased on aver-

age by 4 percent in the first quarter of this year, according to a Jones Lang LaSalle report.

“In Q1 2012, the average price on the primary market of Bucharest experienced a decrease of 4 percent quarter on quarter. While 2011 was characterized by slight ups and downs in the market average, the price development in 2012 is expected to see a more pronounced correction,” reads the report.

The latest data from the National Statistics Institute confirm the trend. At a national level, the number of newly constructed housing developments dropped 11 percent in the first quarter of this year against the same period of 2011.

For Bucharest and Ilfov county, the decline was even more pronounced with a 26 percent decrease.

simona.bazavan @business-review.ro

www.business-review.ro Business Review | June 11 - 17, 2012

14 CITY FILM REVIEW

WHO’S NEWS

Friends with Kids

Business Review welcomes information for Who’s News from readers. Submissions may be edited for length and clarity. Get in touch at simona.bazavan@business-review.ro

Adriana Lobda has been promoted to equity partner at Deloitte. She is head of the regional Deloitte Cluj office. With over 15 years of experience in financial audit, Lobda has a background in audit engagements at local and multinational companies in sectors such as consumer business and transportation, manufacturing, healthcare and the public sector. She is a member of the Chamber of Financial Auditors of Romania and graduated from the Faculty of International Business and Economics within the Academy for Economic Studies. She also graduated from the ACCA Program and holds an Executive MBA. Friendly offer: Adam Scott and Jennifer Westfeldt play chums with a child

DEBBIE STOWE Director: Jennifer Westfeldt Starring: Adam Scott, Jennifer Westfeldt, Jon Hamm, Kristen Wiig, Maya Rudolph, Chris O’Dowd, Megan Fox, Edward Burns On at: Cinema City Cotroceni, Cinema City Sun Plaza, Grand Cinema Digiplex Baneasa, Hollywood Multiplex, Movieplex Cinema A frightening time, one’s thirties. Either you have kids, and the restaurants and romance are sacrificed on the altar of diapers and dungarees. Or you don’t have kids and your friends who do are boring you to tears with baby talk and don’t want to go out and do fun stuff anymore. Or maybe you haven’t found “the one” yet and the clock is ticking…

Such are the various lots of the titular friends. At the start of the film the six childless Manhattanites are living it up, exchanging witty and emotionally literate banter in trendy Upper West Side eateries. But their fun, adult lives and bathroom quickies are ruined when the kids start coming along. Suddenly it’s only best friends Jason and Julie (Adam Scott and Jennifer Westfeldt) left sans sprog and their pals’ previously enviable marriages are on the fast track to dullsville.

Wouldn’t it be great, muse Jase and Jules, if you could have a kid with someone you trust and love platonically, split all the parenting, and then get back on the dating scene without the pressure of the biological clock? Also, Julie is that most

ISSN No. 1453 - 729X

tragic Hollywood creature, a single, childless woman in her late thirties, and time is running out. So Jason and Julie do the deed, and the film explores the consequences of their modern family unit and unconventional life choices.

It’s an interesting premise, and until the end, which returns to more conventional romcom territory, FWK makes a good fist of considering the dilemmas, both typical and atypical, that face formerly vivacious and career-minded people who suddenly find themselves staring down the barrel of middle age and dealing with the shock that they are no longer 22. An independent film, it was written, produced and directed by the star, Jennifer Westfeldt, and definitely feels more personal and considered than the usual studio output.

Not that it avoids all Hollywood cliché.

When normal people’s lives are in meltdown, we might weep, pyjama-clad, into our cereal in our poky flats. When the Friends with Kids’ lives are in meltdown, it happens in Dior in duplexes, or in swanky uptown restaurants, or in Vermont log cabins. Even when the kids mean they have to move out to Brooklyn (oh, the horror!) their toy-strewn brownstones are still like show homes. And you can probably write the final scene within the first few minutes of the movie.

But that aside, FWK is an engaging, thoughtful picture, helped by a lively script and believable performances from the six leads. It deals with issues that many viewers have, are or will confront, and serves as an intriguing what if…? ∫ FOUNDING EDITOR Bill Avery EDITOR-IN-CHIEF Simona Fodor SENIOR JOURNALIST Otilia Haraga JOURNALISTS Simona Bazavan, Ovidiu Posirca, Oana Vasiliu COPY EDITOR Debbie Stowe COLLABORATORS Anda Sebesi ART DIRECTOR Alexandru Oriean PHOTO EDITOR: Mihai Constantineanu PHOTOGRAPHER Laurentiu Obae LAYOUT Beatrice Gheorghiu

Sorina Mardare head of the business process outsourcing (BPO) service line, has been promoted to equity partner at Deloitte.

After 12 years of experience in audit, she assumed the regional leadership position of the Balkans BPO practice in June

2008. While working in audit, Mardare had large exposure to the manufacturing industry, TMT, trading companies and the oil & gas industry. She has extensive statutory and IFRS accounting experience, acting as auditor and advisor on accounting issues, as well as financial due diligence and review assignments. Mardare has an ACCA qualification and is also a Romanian certified accountant and auditor.

Mihai Tudor 51, who had been served as general manager of IBM South East Europe since January 2011, left the company at the end of May, according to Ziarul Financiar daily. After 18 years spent in various positions at IBM, which also included general manager of the Romanian branch, he has decided to take a career break, during which time he will consider whether to join another multinational or start out on his own.From July 2006 until December 2010, Tudor was general manager of IBM Romania. In 2001, he was responsible for business in Central and Eastern Europe, the Middle East and Africa. Between 1998 and 2011, he served as sales director of IBM Romania.

BUSINESS AGENDA June 11 -12 Bancpost organizes the delegation and business forum Go International, entitled Greece-Romania: At the Confluence of Regional Commercial Synergies, at JW Marriott Hotel.

The event is supported by the Chamber of Commerce and Industry of Romania and the HellenicRomanian Chamber of Commerce and Industry.

June 12 10:00 RBS Romania organizes an event to present the results of its financial education program at its headquarters in Lakeview building. Henk Paardekooper, RBS president, will attend. By invitation only.

10:30 Musat & Asociatii and the Bucharest Stock Exchange organize a seminar on stock exchange listings at the Musat & Asociatii headquarters. By invitation only.

PUBLISHER Anca Ionita EXECUTIVE DIRECTOR George Moise SALES & EVENTS DIRECTOR Oana Molodoi MARKETING MANAGER Ana-Maria Stanca SALES & EVENTS Ana-Maria Nedelcu RESEARCH & SUBSCRIPTION Lili Voineag PRODUCTION Dan Mitroi DISTRIBUTION Eugen Musat

June 13 10:30 DLA Piper Romania organizes a seminar on personal data processing at its headquarters. By invitation only.

AvocatNet.ro awards gala 2012, which rewards the best performing law firms and consultancy firms during 2011, is organized at Crystal Palace Ballrooms. By invitation only.

June 20 ∫EVENT / 09:00 BR organizes the second edition of the International Investment Forum – Focus on Tourism & Hospitality at Howard Johnson Grand Plaza Hotel. Find out more at http://business-review.ro/brevents/ June 21 / 18:30-20:30 Sheffield EMBA organizes BEING Better in Business at the Hilton Hotel. Free entrance; please confirm your seat at avasile@city.academic.gr. Find out more at www.city-sheffield.ro.

PUBLISHER Block Notes Media ADDRESS No. 10 Italiana St., 2nd floor, ap. 3 Bucharest, Romania LANDLINE Editorial: 031.040.09.32 Office: 031.040.09.31 EMAILS Editorial: editorial@business-review.ro Sales: sales@business-review.ro Events: events@business-review.ro