Romania - Establishing an Office Romania - Establishing an Office
Opening a local office in Romania involves several steps:
1. Choose the type of company
General Partnership (SNC): A general partnership can be set up by at least two shareholders. The partnership relationship is based upon a contract. Like with the other four types of companies (briefly described below), the shareholders must register their partnership with the National Trade Register Office of the Ministry of Justice. The shareholders in a general partnership have unlimited and joint liability towards the company’s debts and obligations.
Limited Partnership (SCS): A limited partnership consists of one or more general shareholders who manage the company’s business, as well as one or more limited shareholders who contribute capital (money or other property) to the partnership but do not participate in its management. Limited shareholders are not liable for the debts and obligations of the partnership beyond their contribution to the registered capital, while the other shareholders (who also manage the company) have unlimited and joint liability towards the company’s debts and obligations.
Joint-Stock Company (SA): A joint stock company is a limited liability corporation with at least two shareholders and a registered share capital of at least RON 119,000 ($27.87) - (Council Directive 77/91/EEC of 1976, replaced by Directive 2017/1132/EU). Shares, with a nominal value of at least RON 0.1 ($0.02) each, can be nominative shares or bearer shares, and can be freely traded or pledged. A joint stock company may be set up privately or by public subscription. Each shareholder must pay at least 30% of his/her portion of the subscribed share capital, with the remaining 70% to be paid within a maximum of 12 months or 2 years.
Limited Partnership by Shares (SCA): This type of company has the same legal regime as a Limited Partnership, other than the fact that the capital is divided into shares. Thus, the company’s obligations are guaranteed by the share capital and by the general partners’ unlimited and joint liability. The limited partners are liable only within the limit of the subscribed share capital. Like the joint stock company, the SCA’s share capital cannot be less than RON 119,000 ($27.87)
Limited Liability Company (SRL): A limited liability company is a company set up by at least one shareholder that cannot have more than 50 shareholders. An individual or a legal entity can act as sole shareholder in only one SRL. Additionally, an SRL’s sole shareholder cannot be another company that itself is owned by a sole shareholder. The subscribed share capital of an SRL is at least RON 200 ($50), divided into shares with a nominal value of at least RON 10 ($2.34) each. The transfer of shares to third parties must be approved by the shareholders holding at least ¾ of the company’s capital.
Representative Offices: Foreign companies may open representative offices in Romania following registration with the Department of Foreign Trade in the Ministry of Economy. Representative offices cannot carry out commercial activities on their own behalf, but they are entitled to promote the business of their parent organizations.
Branches: Foreign companies have no legal capacity and can only carry out activities within the parent company’s obligations. They must be registered with the relevant trade registry office.
2. Determine location of headquarters
Foreign companies are required to have a physical location (not necessarily a postal address) as their headquarters and must demonstrate that the premises are fully operational - i.e., the company fulfills all conditions required to carry out the activities authorized at that given location (necessary equipment, computer(s), personnel allocated at the company’s premises, etc.). In order to approve the company’s fiscal registration with the relevant local authority, such conditions are strictly verified by the fiscal administration upon control on site. As an exception, upon initial registration, a newly set up Romanian legal entity may choose to establish its registered office with an attorney at law/law firm for a maximum period of one year.
3. Register the name of the company
The company’s name is registered with the Trade Registry Office in the jurisdiction where the company is to be located.
4. Create bylaws and binding documents
General partnerships and limited partnerships are usually set up by their founders through by-laws. Joint-stock companies, limited partnerships by shares, and limited liability companies are set up through by-laws and articles of incorporation. By-laws and articles of incorporation may be concluded under a single document - the Constitutive Deed.
5. Open a company account
A company account is opened in the registered name of the company prior to the company’s official registration. The shareholders (or their designees) deposit the share capital in the company account. The amount in the account depends on the form of business organization, but as an example, a limited liability company has a minimum starting capital of RON 200 ($50).
6. File other required legal documents
Other documents are required to be filed with the local Trade Registry Office under the setting-up file. Such documents include the decision of the competent body of the company’s shareholders (in case such shareholders are legal entities), statement(s) of the company’s director(s), statements from the company’s shareholders that they fulfill the legal requirements to be shareholders in a Romanian company, powers of attorney fiscal records, bank letter, etc.
7. Submit the complete dossier to the One-Stop Office
Once the application, or dossier, is complete, it is submitted to the One-Stop Office in the proper jurisdiction. This office falls under the National Trade Registry Office of the Ministry of Justice.