European Broadcasting Union, which runs contest, says Romania’s national broadcaster owes more than £7.9m

Romania has suffered a fate worse than nul points after being booted out of this year’s Eurovision competition because it failed to clear its debts to the European Broadcasting Union.

The EBU, which runs Eurovision, said Romania’s national broadcaster, Televiziunea Romana, had failed to pay debts totalling more than £7.9m.

Ingrid Deltenre, director general of the EBU, said it was “regrettable that we are forced to take this action” but four attempts to get a response from the Romanian government had received no reply.

“The continued indebtedness of TVR jeopardises the financial stability of the EBU itself,” Deltenre said, confirming that the Romanian act, Ovidiu Anton, would be taken out of the running order of the second semi-final on 12 May.

When the expulsion was first rumoured, TVR insisted it had paid off debts for the period 2008 to 2012, but added: “The latest payment was made in January this year in the amount of €250,000 after which TVR informed the international organisation that it can’t sustain these payments any more.”

On Monday, Romania’s prime minister, Dacian Ciolos, said the government would seek a solution to avoid being locked out of the competition. A deadline for payment was extended until Thursday, but no payment was received, according to EBU.

In recent weeks, the ministry of finance has suggested TVR, which recorded losses of more than £4.2m last year, may face insolvency proceedings and a dramatic restructuring.

“This is of course disappointing for the artist chosen to represent Romania, for our colleagues at TVR who have prepared their participation so well this year and, not least, for Romanian viewers and the many Eurovision fans in the country,” says Jon Ola Sand, executive supervisor of the Eurovision song contest at the EBU.

Anton, who was set to perform his English-language song Moment of Silence, said he had also been kept in the dark. “I don’t think this should happen to any artist,” he told the Guardian last week.

“No one has contacted me. I’ve just heard the rumours and seen the news. “I’m just going to pretend I didn’t hear anything and keep preparing until I am told otherwise. Hopefully it will be solved.”

Romania has never finished higher than third in the competition in 22 years of participating. The contest will be held in Sweden this year, with the final on 14 May.

Pre-ordered CDs will include the Romanian entry and Romanian press and fans will still be able to attend the contest in Stockholm, but will be moved to sit with the international delegation for non-participating countries, a spokesman said.

The ruling may also affect whether Televiziunea Romana can broadcast Euro 2016 and this summer’s Olympic Games in Rio.