The practice of gambling in 2022
Joint venture agreement for the development of gambling activities
Due to the fact that the special regulation of gambling in Romania allows, as an exception to the general rule, the joint or non-operation of gambling between an organizer and one or more economic operators or individuals, among which there is a contract concluded under the law, for reasons of a fiscal nature, the most common form of exploitation of joint gambling is the joint venture.
The joint venture agreement, according to the legal provisions, includes mandatory elements and then conventional clauses, between the parties, with specific provisions on the organization and operation of the gambling activity.
A) The mandatory elements, which must be taken into account when concluding the joint venture contract, in the activity of gambling, presented in a synthetic form, would be:
a) Establishing and clearly describing the operations that they will undertake jointly, as well as specifying that one or more persons are granted a share in the profits or losses realized from these operations;
b) This type of joint venture agreement is proven only by a document;
c) The joint venture cannot acquire legal personality and does not constitute, towards third parties, a distinct person from the person of the associates;
d) The third party has no right to associate and is bound only to the associate with whom he has contracted;
e) The associates exercise all the rights deriving from the concluded contracts, by any of them, but the third party is held exclusively towards the associate with whom he contracted, unless the latter declared his quality at the moment of concluding the act;
f) Any clause, from the association contract, which limits the liability of the associates towards third parties is not applicable to them;
g) Any clause that establishes a guaranteed minimum level of benefits for one or more of the partners is considered unwritten.
B) The conventional clauses, in the joint venture agreement, may include:
a) The agreement of the parties that will determine: the form of the contract; the extent and conditions of the association; the causes of its dissolution and liquidation;
b) The associates remain the owners of the goods made available to the association but they can agree that the goods brought in association, as well as those obtained as a result of their use, become common property;
c) The goods made available to the association may pass, in whole or in part, into the property of one of the associates for the realization of the object of the association, under the conditions agreed by contract and in compliance with the publicity formalities provided by law;
d) The associates may stipulate the recovery in kind of the goods at the termination of the association;
e) The associates, even acting on behalf of the association, contract and commit in their own name towards third parties but are held jointly and severally by the acts concluded by any of them.
In order to organize and manage the accounting as well as to apply the appropriate tax treatment, those who have been appointed to lead the joint venture must take into account that:
a) Joint ventures do not give rise to a separate taxable person;
b) In an association, between two or more Romanian legal entities, the registered income and expenses are attributed to each associate, according to the provisions of the association contract;
c) The income and expenses, determined by the operations of the association, transmitted on the basis of a statement to each member, according to the applicable accounting regulations, are taken into account for determining the taxable profit of each member;
d) The supporting documents related to the operations of the association are those that were the basis for the registration in the accounting records, by the person designated by the associates, according to the provisions of the association contract;
e) The company that keeps the records of the joint venture keeps records and draws up check balances distinct from those corresponding to its own activity;
f) Tangible and intangible assets, made available to the association, are included in the accounting records of the owner;
g) The expenses and incomes determined by the operations of the joint ventures are accounted separately by one of the associates, according to the provisions of the association contract;
h) At the end of the reporting period, the expenses and income recorded by nature are sent on the basis of a statement to each partner, in order to record them in their own accounts;
i) At the balance sheet date, the assets of the nature of stocks, receivables, cash, as well as the debts of the joint venture, are recorded in the annual financial statements of the associate who keeps the records of the association.
“Statement for joint ventures” is the supporting document, which is used in all areas of activity, in which joint ventures are carried out, on the basis of which the expenses and income from joint ventures are reimbursed, as well as the amounts to be transferred between associates.
The statement is drawn up by the entity that keeps the accounting of the joint venture, monthly or within the terms provided in the contract, on each partner, with its income and expenses, for registration in its own accounting, according to the quotas provided in the concluded association contracts. Expenditures and revenues will be grouped by accounts in the classes of expense and revenue accounts, according to the applicable chart of accounts.
Other transfers are included in the statement, representing the value of the funds, of the realized profit, the amortization of the fixed assets and other amounts resulted from the joint operations.
The accounting records of the settlements from the joint ventures, for the activity of the joint ventures, are kept with the help of account 458 “Settlements from joint ventures”, based on the settlement of expenses and revenues from joint ventures, as well as the amounts transferred between co-participants.
Account 458 “Settlements from joint ventures” is a bifunctional account;
1. The credit of account 458 “Settlements from joint operations” records:
– the revenues from joint operations transferred to the co-participants, according to the association contract (701 to 781);
– expenses received by transfer from joint ventures, including depreciation calculated by the owner of the asset (601 to 681);
– amounts received from co-participants (512, 531).
2. The debit of account 458 “Settlements from joint operations” records:
– income received by transfer from joint ventures (701 to 781);
– the expenses transferred from joint operations, including the depreciation calculated by the owner of the asset, which is sent to the co-participant who keeps records of the joint operations according to the contracts (601 to 681);
– amounts paid to co-participants or transferred as a result of joint ventures (512, 531).
3. The credit balance of the account represents the amounts due to the co-participants as a favorable result (profit) from the joint operations, as well as the amounts owed by the co-participants to cover the eventual losses registered from the joint operations.
4. The debit balance of the account represents the amounts receivable from the co-participants to cover any losses recorded from joint operations, as well as the amounts to be collected by co-participants from joint operations as a favorable result (profit).
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