Financial Capacity Certifications

CERTIFICATIONS OF FINANCIAL CAPACITY
TRANSPORT OPERATORS CERTIFICATION
REGULATORY REFERENCE

Page updated with the changes introduced by Law No. 190 of December 23, 2014, known as the "2015 Stability Law," Article 1, Paragraph 251 – Demonstration of the financial capacity requirement for the practice of the profession of road transport for third parties.

For the purpose of carrying out road transport of people or goods for third parties with vehicles of a total mass exceeding 1.5 tons, the combined provisions of Article 7 of Regulation (EC) No. 1071/2009 and Law Decree No. 5/2012, converted into Law No. 35/2012, require the possession of the prerequisites of good repute, professional competence, and establishment, as well as the demonstration of the financial capacity requirement. This must be proven by the availability of capital or reserves amounting to €9,000 for the first vehicle and €5,000 for each additional vehicle used.

Through specific circulars and interpretative notes, the Ministry of Infrastructure and Transport has clarified the implementation methods of these provisions. It allows for the financial capacity requirement to be demonstrated, as an alternative to the certification by an auditor based on the company's accounts, through a surety bond issued by Banks, Insurance Companies, or authorized Financial Intermediaries, or through a Professional Liability Insurance policy.

Law No. 190 of December 23, 2014, established that new companies, which from January 1, 2015, apply for authorization to practice the profession of road transport, may demonstrate the financial capacity requirement also through a professional liability insurance policy. However, this is limited to the first two years of business operation, due to the absence of accounts to be certified in newly established companies and the difficulties these companies face in obtaining surety guarantees.

Moreover, the law specified that, starting from the third year of business operation, the financial capacity requirement can only be proven by certification issued by an auditor, based on the company's annual accounts, or alternatively, through a surety guarantee issued by a bank or insurance company.

This surety guarantee may only be issued by Banks, Insurance Companies, or authorized Financial Intermediaries registered in the respective registers, excluding, therefore, professional liability insurance policies.

If the competent authorities find that the financial capacity requirement has not been met, the company will be given a deadline of no more than six (6) months to fulfill the requirement again.

OUR SOLUTION

We are able to issue both the Professional Liability Insurance policy, valid for transport companies in their first two years of operation, and the surety guarantee for transport companies that have been operating for more than two years.

DOCUMENTS TO BE SUBMITTED

Only the documents mentioned below need to be produced:

CHAMBER OF COMMERCE REGISTRATION
Dated no more than 3 (three) months prior.

VALID IDENTITY DOCUMENT
Of the applicant.

QUESTIONNAIRE
Only for transport companies in their first two years of business:

LATEST AVAILABLE FINANCIAL STATEMENT / LAST TAX RETURN
Only for transport companies that have been in business for more than two years.

The response and issuance times for this type of application are 48 hours from receipt of the documents.
GENERAL INFORMATION

The Financial Capacity Product is aimed at various transport companies for third-party freight transport.
The policy includes the issuance of a validity certificate required by the offices of civil motorization, through which the contracting company demonstrates its financial capacity. This financial capacity requirement is met by the identification of a single transport manager responsible for overseeing the company’s transport activities.
The transport manager can be either internal or external to the company, depending on whether they meet both necessary criteria.

Financial Capacity refers to the company's ability to fulfill, at any time, the financial obligations connected to its business operations, which may arise during the annual accounting period.

REGULATORY FRAMEWORK

European Regulation (EC) No. 1071/2009 – Article 7 – Conditions relating to the financial capacity requirement:

To meet the requirement of Article 3, Paragraph 1, Letter c), a company must be able to comply with its financial obligations at any time during the annual accounting period. For this purpose, based on the annual accounts, certified by an auditor or other duly recognized person, the company demonstrates that it has, each year, capital and reserves worth at least €9,000.00 when only one vehicle is used, and €5,000.00 for each additional vehicle used. For the purposes of this regulation, the euro value is set each year in the currencies of Member States that do not participate in the third phase of the economic and monetary union. The rates in effect on the first working day of October are applied and published in the Official Journal of the European Union, coming into force on January 10 of the following calendar year. The accounting items referred to in the first paragraph are defined in the Fourth Directive 78/660/EEC of the Council, dated July 25, 1978, based on Article 54, Paragraph 3, Letter g) of the Treaty, concerning the annual accounts of certain types of companies.

By way of derogation from Paragraph 1, the competent authority may allow or require a company to demonstrate its financial capacity by means of a certificate, such as a bank guarantee or insurance, including professional liability insurance, issued by one or more banks or other financial entities, including insurance companies, that declare themselves jointly liable as guarantors for the company for the amounts specified in Paragraph 1, first sentence.

The annual accounts referred to in Paragraph 1 and the guarantee referred to in Paragraph 2, which must be verified, are those of the economic entity established in the Member State where authorization was requested, and not those of any other entities established in another Member State.

Executive Decree No. 291/2011 of the Ministry of Infrastructure and Transport - Article 3 - Requirements for the practice of the road transport profession:

To obtain authorization to practice the profession, companies that transport goods by road for third parties must:

Prove or have proven their good repute, professional competence, and financial capacity, as regulated by this decree, by registering with the National Register of individuals and legal entities engaged in third-party road transport, as per Law No. 298 of June 6, 1974.

Prove or have proven they have a permanent and stable establishment, and, where required by applicable provisions, comply or have complied with Article 2, Paragraph 227, of Law No. 244 of December 24, 2007.

Companies that provide road transport of passengers must prove or have proven their good repute, professional competence, and financial capacity, as well as the requirement of establishment, according to the regulations of this decree.

Road transport companies must notify the relevant authorities within thirty days if they lose one or more of the requirements outlined in Paragraphs 1 and 2.

Executive Decree No. 291/2011 of the Ministry of Infrastructure and Transport - Article 7 - Financial Capacity Requirement:

Notwithstanding the provisions of Article 7, Paragraph 1, of Regulation (EC) No. 1071/2009, road transport companies are required to demonstrate the existence of the financial capacity requirement each year through one of the following methods:

A certificate issued by an auditor registered in the register of auditors, held by the Council of Chartered Accountants and Accounting Experts, certifying that, based on an analysis of the annual accounts, the company has capital and reserves no less than the amount required under Article 7, Paragraph 1 of the aforementioned Regulation.

A certificate issued by one or more banks, insurance companies, or authorized financial intermediaries, in the form of a bank or insurance surety bond, including professional liability insurance, for the amount required under Article 7, Paragraph 1 of the aforementioned Regulation.

Road transport companies or the entities that issued the certificates mentioned in this paragraph are required to notify the competent authority in writing within fifteen days of becoming aware of any event that reduces or nullifies the certified financial capacity.

Circular of the Ministry of Infrastructure and Transport No. 1 of January 28, 2015: (excerpt):

Finally, with Law No. 190/2014, it was established that new companies applying for authorization to practice the road transport profession from January 1, 2015, have the option to demonstrate the financial capacity requirement also through professional liability insurance. However, this is limited to the first two years of business operation due to the absence – in newly established companies – of accounts to be certified and the difficulties these companies face in obtaining surety guarantees. The aforementioned law also clarified that, starting from the third year of business operation, the financial capacity requirement can only be demonstrated through a certificate issued by an auditor based on the company’s annual accounts or, alternatively, through a bank or insurance surety bond.

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