Romanian HORECA entrepreneur speaks of burgeoning local bureaucracy

Dragos Petrescu, the owner of the City Grill restaurant chain, says an entrepreneur who has the money to make and investment and the business plan can expect to wait two to three years to effectively start their business, Hotnews.ro reported. “If today you have the money needed for an investment and have made the business plan, you need to expect to have the first functioning day within two and three years since setting everything up. Getting the construction authorization takes in between one and three years, regardless of whether you are a greenfield or are refurbishing a space,” Petrescu said during a conference organized by business organization Romanian Business Leaders. Petrescu explained that up until 2004 companies obeyed a law that stipulated that five authorizations were needed but after the 2015 Colectiv nightclub fire a new procedure was introduced, allowing each local council to decide how many documents are needed for a functioning authorization. “This set of documents is different from one city hall to another, and, on top of it, in Bucharest, from one street to another, depending on the district you are in. For instance, in District 1, 16 documents are required, the same in District 2. If you are operating in District 3, you need 13 documents, in District 4 you need 19 documents, in District 5 you need 23 documents, and in District 6, 19 documents,” Petrescu said. Petrescu outlined several issues that the hospitality industry is confronted with. One of them is that the issuing of authorizations by local authorities is not unitary throughout the country or even Bucharest, and unfair competition conditions are created in certain areas. At the same time, an agreement from neighbors is required yearly in order to receive a working point from the Trade Registry, which can lead to abuses from neighbors. Furthermore, the issuing of a functioning permit can be made in most cases only if units retailing food own an authorization issued by the Inspectorates for Emergency Situations, which depends in its turn to another authorization, such as the building one, which is issued by district city halls. Some 3,500 public food units are currently impacted by this situation, according to the same source. Another entrepreneur speaking at the same conference, healthcare network founder Mihai Marcu, referred to delays caused by a lack of clarity as to who is to issue certain authorizations. “Instead of putting money into infrastructure and connecting Romania’s regions, we are being reminded of these salary increases. This needs to be thought through with the Fiscal Council. More recently, there is a new law saying that buildings located in the area of historical monuments need to have an approval from the Bucharest City Hall. We are being passed on from the Bucharest City Hall to the district city halls because nobody has the authority to grant the authorization. For each authorization we paid hundreds of thousands of euros, and only in Bucharest we have three such situations at three different city halls,” Marcu said.