Justice Reform is great for Business

Joint blog by Catalin Predoiu, Romanian Minister of Justice  and Martin Harris, British Ambassador to Romania

2011 has already proved to be a great year in Romania-UK relations with the visits of President Traian Basescu and Foreign Minister Teodor Baconschi to London.  Justice Minister Catalin Predoiu’s visit last week, as the guest of the Justice Secretary Ken Clarke, is another highlight.  Minister Predoiu also met the Minister for Europe, the President of the Supreme Court, the Director-General of the Serious Organised Crime Agency, and the Chairman of the Justice Committee in Parliament.

The outcome of these meetings will be of great benefit to both our countries as we work together to fight ATM fraud, to improve instruments for asset recovery, and to draw on UK experience in improving Romania’s prison infrastructure.  The UK has also pledged to continue to support Romania meet the benchmarks of the Cooperation and Verification Mechanism, through work on identifying court delays and training magistrates on the new National Integrity Agency law and provisions for seizing criminals assets.

One of the most interesting challenges to come out of the visit was the one the Justice Minister made to British business: “please get involved”.  The Romanian Civil Code due to be launched on 1 October will offer wide-ranging and immediate benefits to business such as streamlining the laws governing property rights, sales and purchasing contracts and simplified procedures on bankruptcy.   The judiciary are now getting behind this project by putting on extra seminars to train magistrates in the new code.

This is a far-reaching reform which could radically improve the business climate in Romania. One of the common complaints of foreign investors is that the legal system is slow and unpredictable. The new code will be much simpler and more coherent.

But for it to succeed business need to get involved too.  The Ministry of Justice has opened its doors to a dialogue between the private sector and government.  Business needs to do more to assist the government to highlight and tackle examples of malpractice in the public sector, whether these be allegations of corruption or poor bureaucratic procedures. And where the courts fall short in processing cases or  misinterpreting the law businessmen should  take this up with the Superior Council of Magistracy, the body that oversees the magistrates and courts.

There is a growing movement for reform in Romania. It needs the support of the private sector, including British businesses, to make a concerted effort to improve the investment climate. The entry into force of the Civil Code on 1 October marks an important milestone, and should encourage more foreign direct investment in Romania.  A strong partnership between private and public sectors will help Romania realise its full potential as an attractive destination for foreign investment and a great place to do business.