Amendments to Law no. 10/1995

Enforcing quality of construction

On 02.07.2015, the Official Gazette published law no. 177/2015 (hereinafter "Law no. 177"), which amends law no. 10/1995 on the quality of constructions (hereinafter "Construction Quality Law"). The changes brought by Law no. 177 came into force on 31.08.2015[1]  and are designed to raise the responsibility levels of constructors, to fight tax evasion and prevent black market working.

The new amendments aim to strength the level of expertise of each of the professionals performing in the construction field. Thus, starting from 31.08.2016, the building designers and other specialists authorized in the construction field must have professional liability insurance policies. In addition, Law no. 177 provides an obligation for building designers to technically assist both, on all building execution stages that are performed based on the building project they have designed (including by being physically present at every relevant execution stage) and subsequently, after the execution of the construction, in the post-utilization period. Furthermore, the additional costs generated by design errors [resulting from an expertise requested by the investor/beneficiary] will be supported by the building designers /project managers (regardless of any of them being a natural or legal person), which will be jointly liable with the project verifiers.

As an additional protection, the fines for disregarding the legal requirements contained in the Construction Quality Law are currently much higher, in opposition with the previous ones. Furthermore, along with the fines, the State Inspectorate for Constructions can also suspend the right to practice of the specialist that had direct involvement in the misdemeanor, up to a maximum of 12 months.

The tax owed by the investors/owners to the State Inspectorate for Constructions was reduced from 0.7% to 0.5% out of the total value of the authorized construction works. Law no. 177 provides two deadlines for paying such tax, respectively 50% at the beginning of the construction, and the difference when the reception minute is signed, at the end of the construction works. Delays in paying this tax are sanctioned with a delay penalty of 0.15% of the due amount, per day of delay. Investors/owners that perform intervention works to strengthen residential buildings classified as class I of seismic risk are excepted from paying this tax.

The requirement of sustainable use of natural resources while doing any kind of construction works shall become effective as of 31.08.2016. Thus, starting from 2016, natural resources, the backbone of every economy, are to be considered in construction works. Although this concept is not explained by Law no. 177, some form of legal provision, containing practical applications of this concept within the construction field is surely to be implemented.

The amendments brought by Law no. 177 to the Quality Construction Law are expected to have impact especially on the construction quality process. Additional pressure on the constructors, developers and authorized construction specialists will lead to a superior result on their behalf. These changes are part of a natural movement that aims to create additional protection for the investors and the owners of constructions and to improve the construction market in Romania.

 


[1] Except for art. 5 par. (1) letter g) - regarding the sustainable use of natural resources and art. 291 - regarding the compulsory obligation of the building designers and other specialists to conclude professional insurance, which will come into force on 31.08.2016.

Author

Alexandru Roman

Associate
Romania