For businesses and intermediaries operating across multiple EU jurisdictions, understanding the One-Stop Shop (OSS) VAT mechanism is vital to ensure compliance and avoid unnecessary administrative burdens.

This article explores the OSS scheme from a European and Romanian legal perspective, offering practical insights for companies and advisors, including guidance from a Romanian law firm.

The OSS regime stems from Council Directive (EU) 2017/2455 and Council Directive (EU) 2019/1995, both amending the VAT Directive (Directive 2006/112/EC). Implemented as of July 1, 2021, the OSS system replaces the earlier Mini One-Stop Shop (MOSS), expanding its scope to cover a broader range of B2C supplies, including distance sales of goods within the EU and certain domestic supplies by electronic interfaces.

The OSS scheme is optional but highly beneficial. It allows taxable persons to declare and pay VAT due in multiple EU Member States through a single online portal hosted by the Member State of identification. This simplifies reporting obligations and mitigates the risk of penalties arising from non-compliance with local VAT rules.

The OSS regime is divided into three distinct schemes:

• Union Scheme: Available to EU-established businesses supplying B2C goods and services in other Member States.
• Non-Union Scheme: Accessible to non-EU businesses supplying B2C services within the EU.
• Import One-Stop Shop (IOSS): Applicable to distance sales of low-value goods (under EUR 150) imported into the EU.

These schemes do not alter the place of taxation rules. VAT continues to be due in the Member State of consumption; the OSS only consolidates the reporting and payment process.

As a Member State of the European Union, Romania implemented the OSS scheme through Government Emergency Ordinance No. 59/2021, which amended the Romanian Fiscal Code (Law No. 227/2015). The National Agency for Fiscal Administration (ANAF) serves as the competent authority responsible for managing OSS registrations and filings.

From a Romanian legal perspective, the OSS scheme significantly simplifies the VAT obligations for Romanian businesses engaged in cross-border B2C sales. Instead of registering for VAT in each Member State where they have customers, Romanian businesses can now report all relevant VAT via ANAF’s OSS portal. This development has been welcomed by Romanian lawyers and international businesses alike, as it reduces compliance costs and administrative burdens.

A business established in Romania can register for the OSS scheme with ANAF via the dedicated online platform. The registration process involves submitting identifying information, confirming the types of supplies made, and selecting the relevant OSS scheme. Once registered, the business must submit OSS VAT returns, even if no transactions occurred during the period.

VAT collected through OSS must be paid in EUR and transferred to ANAF’s dedicated OSS bank account. When services are invoiced in RON or other currencies, amounts must be converted to EUR using the exchange rate published by the European Central Bank on the last day of the reporting period.

Subsequently, ANAF redistributes the VAT to the appropriate Member States of consumption. A Romanian law firm can assist with OSS registration, ensure the correct classification of supplies, and support ongoing compliance to mitigate audit risks and potential penalties.

The OSS scheme offers a multitude of advantages:

• Reduced Compliance Burden: Businesses avoid multiple VAT registrations across the EU.
• Streamlined Administration: A single quarterly return and payment mechanism simplifies financial operations.
• Cost Savings: Lower administrative and consultancy costs due to reduced complexity.
• Improved Legal Certainty: Clear guidelines and standardised procedures enhance legal predictability.

For Romanian e-commerce platforms, logistics companies, and digital service providers, these benefits are particularly relevant. Romanian lawyers specialising in tax and EU law often recommend OSS registration as part of a comprehensive VAT compliance strategy.

Despite its advantages, the OSS is not without challenges. Key practical considerations include:

• System Limitations: OSS returns are limited to certain types of supplies and cannot include B2B transactions.
• Data Accuracy: Errors in VAT identification numbers, customer locations, or transaction values can lead to discrepancies.
• Exchange Rate Risk: VAT amounts must be declared and paid in EUR, introducing exchange rate considerations for Romanian RON-based companies.
• Audit Preparedness: Each Member State retains the right to audit OSS returns relating to supplies in its territory.

A law firm in Romania can help businesses address these complexities through proactive advisory, training, and compliance audits.

Romanian businesses should evaluate whether OSS registration aligns with their operational models. For instance:

• E-commerce Platforms: Romanian sellers on various platforms may be obligated to use the OSS depending on the platform’s role in the transaction.
• Market Expansion: Companies targeting EU consumers benefit from easier VAT compliance, enabling smoother market entry.
• Digital Services: Providers of telecommunications, broadcasting, and electronic services can reduce VAT burdens via the Non-Union OSS or Union OSS schemes.

Failure to comply with OSS obligations may result in:

• Financial penalties imposed by the Member State of consumption
• Interest on unpaid VAT
• Deregistration from the OSS scheme
• Potential reputational harm

A business may also be excluded from the OSS scheme if it no longer qualifies, ceases operations, or repeatedly breaches compliance obligations. Romanian law requires strict adherence to VAT compliance rules. Romanian lawyers can assist in responding to inquiries from tax authorities and implementing corrective measures where necessary.

A Romanian law firm with experience in EU VAT law can provide invaluable support in navigating OSS obligations. Whether it involves registration, legal risk management, or liaising with tax authorities, qualified Romanian lawyers ensure that businesses remain compliant and competitive.

For tailored legal advice regarding OSS registration and compliance in Romania, feel free to contact our team at BMA Legal. Our VAT specialists and lawyers in Romania are ready to support your cross-border growth.