The Competition Council: Romanians pay notary services 14 times more than Germans do for the same transaction 

The situation of the Romanian notary markets is worse than in other EU countries and the lack of competition on this market leads to higher prices, an investigation performed by the Competition Council shows. The data indicate that Romania has the highest real cost of notary services in 21 EU states included in the study. Romanians pay 14 times more than a German do for the same services.

„The real cost of the notary services, represented by the honorary plus the mean income and estimated as a percentage from the transaction’s value, is highest in Romania, considering the 21 EU members included in the analysis, amounting to over four times the mean price. In comparison with other European countries, Romania has a real notary services cost seven times more expensive than in Portugal, 14 times higher than in Germany, five times bigger than in France, six times the prices in Austria or Spain, and four times the value in Belgium. Even if compared with other Central and East European countries, in Romania the real notary honoraries are bigger than in Poland, Hungary or Slovenia”, the analysis indicates.

The Competition Council data show that the notaries’ honoraries, in terms of the transaction percentage (100,000 euros) plus the mean income amounts to 7.59% in Romania, namely 14 times the price in Germany, where the percentage is 0.54%.

The competition proposes that the tariffs for writing the selling-buying contract are removed, to bring annually 15 to 30 million euros in savings. The Competition Council proposes that the honoraries could be reduced by 15% through standard contracts for most transactions. „The contract does not involve creativity or a special effort from the notary and this, at least, is not justified. If this measure was introduced, at the national economy level, depending on the transactions’ volume, 15 to 30 million euros could be spared annually”, the authority’s chief Bogdan Chiritoiu said.

The Competition wants the notaries to list publicly and explicitly their tariffs. This market should be opened and the competition, intensified. „If the notary market was open, they will compete against each other and will accept to work more for less. If there are means to make notary tariffs public in a way in which the client sees them on a small sheet of paper somewhere in a corner, then the notaries will be interested to have smaller tariffs to attract clients”, Chiritoiu added.

The Competition Council stated that it will „notify the national Authority for the protection of the Consumer regarding the scarce information the banks give their clients on their selected notaries for the mortgage credits transactions, especially in the information from the initial phase in regards to the tariffs those notaries employ.

Except the notary market, the Competition Council also analysed the real estate mediation services, cadastre and real estate evaluation. The investigation started in April 2008 and followed possible competition issues, especially the markets around the real estate transactions and their effects on consumers. All the derivate recommendations will be sent towards Parliamentary Commissions and the Government.