Romanian Joint Stock Company
SA INCORPORATION
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Romanian SA Company Registration
A joint-stock company is a limited liability corporation with a registered capital of a minimum of 25.000 EUR or the equivalent in Romanian currency Ron, but no less than 90.000 RON and with at least two shareholders. They are 2 types of shares that could be used for a joint-stock company: registered shares or bearer shares and can be freely traded or pledged. To set up the joint-stock company it is required that the registered capital is fully and simultaneously subscribed by all signers of the constitutive act or by public subscription.
In order to open a joint-stock company in Romania the following documents and information are required to be filled:
- the shareholders’ personal information: full name, place, and date of birth, residence, and nationality;
- the company’s name and registered office;
- details regarding business conduct and management;
- personal information regarding the managers’ residence, nationality, responsibilities, extraordinary powers or rights;
- types of activities performed by the business organization;
- number, nominal value, and type of shares;
- subscribed share capital and paid share capital. The minimum share capital subscribed by each shareholder at the very moment of setting-up the company cannot be less than 30% of the total sum. The other 70% must be paid in the following 12 months from the registration.
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REGISTER AN SA COMPANY
Joint-Stock Companies in Romania and its stockholders
The creation of a Stock Company in Romania is recommended for big businesses and important investments, as is a complex type of legal entity. Similar to the SRL associates, the stockholders from a Romanian joint-stock company can be companies or individuals. The difference is that the joint-stock company must have at least 2 stockholders. In the case that the company has fewer than 2 stockholders for more than 9 months, anyone interested can ask the dissolution of the company in court. There is still time to avoid the dissolution, by bringing at least one more stockholder in the company until the final decision of the court is announced.
INCORPORATE AN SA BUSINESS
Decisions of the General Meeting of Shareholders
For the joint-stock company in Romania, the law stipulates that the resolutions are made by mainstream ballot in the General Meeting of the Shareholders (1 share = 1 vote). On the other hand, General Meetings can be set up as a regular assembly, held at least once per year or under exceptional circumstances, called in case of decisions regarding modifications of the Memorandum of Association. Meetings need a quorum of 75 % of the shareholders and a simple majority vote of the quorum is demanded to agree with modifications in the Memorandum of Association. Unless the Memorandum of Association specifies something else, shareholders will vote in accordance with the shares they own. Shareholders can empower other shareholders to vote on their behalf through a substitution contract if the statute doesn’t forbid it.
The executive power of a joint-stock company is held by a Board of Directors, even though it is likely to have just one Manager. In any case, half of the Administrators have to be Romanian citizens except for the case in which the founding regulations and corporate statute stipulate something else.
It is not mandatory for executives to be shareholders. They are elected by the General Meeting of Shareholders, which institutes their authority, for a period of a maximum of four years. The managers can be re-confirmed. The procedure used when deciding to set up SA Company stipulates that, prior to beginning their job, managers are requested to place a guarantee, representing a minimum value equal to the price of ten shares or corresponding to an amount of two times their annual salary.
The General Meeting of Shareholders appoints three auditors and three deputy auditors (unless in the Articles of incorporation it is mentioned a greater number than three). At least one of them has to be a certified accountant or a chartered accountant. Most of the auditors and of the deputy auditors have to be Romanian nationals. One of the auditors has to be recommended by the Ministry of Finance in case 20% of the company’s share capital is owned by the State.
INCORPORATE A BUSINESS
Joint-Stock Companies in Romania and its stockholders
The creation of a Stock Company in Romania is recommended for big businesses and important investments, as is a complex type of legal entity. Similar to the SRL associates, the stockholders from a Romanian joint-stock company can be companies or individuals. The difference is that the joint-stock company must have at least 2 stockholders. In the case that the company has fewer than 2 stockholders for more than 9 months, anyone interested can ask the dissolution of the company in court. There is still time to avoid the dissolution, by bringing at least one more stockholder in the company until the final decision of the court is announced.
INCORPORATE AN SA BUSINESS
Registered capital
The registered capital must be at least 90.000 lei. This threshold is regulated by the Government every two years in order to match the equivalent of 25.000 Eur in Romanian currency. The stockholders may contribute with receivables or cash and the working performance is not accepted to increase the capital.
Contributions that are made in-kind must be economically evaluated by the experts appointed by the judge in 5 days from submitting the registration request. The expert, or experts, must be from the authorized list and will write a report which includes the evaluation and description of each good, as must clearly state the granted shares in exchange for their value.
The stocks have the following characteristics:
- Stocks are indivisibles: a single person must represent the rights deriving from a social share that is the property of more persons
- Stocks are fractions of the capital that have a certain value which is nominal and cannot be less than 0.1 lei according to the law
- Stocks have equal nominal value resulting in equal rights for the owners. Still, stocks that are issued according to the Articles of Incorporation and provisions of preference stocks law, do not offer their holders the voting right in the General Gathering. Holders of these types of stocks are entitled to priority dividend distribution through the financial year. Certain key persons in the company are not entitled to preferred dividend stocks: directors, administrators or auditors.
- Stocks might be nominative or to the barer depending on their nature which is determined by the Articles of Incorporation. However, if the general gathering decides, nominative stock can be turned into barer stocks and barer stocks can be turned into nominative stocks.
- Stocks are negotiable as they incorporate patrimonial value. Therefore, they are considered securities of bonds and can be traded on regulated markets.
INCORPORATE A BUSINESS
Responsibilities and rights of shareholders
Shareholders can participate in general meetings of shareholders, they can vote (if this right was not suspended for those who weren’t informed about due levies), beneficiate from dividends, know about the activity in the company and also have the right to their deserved part in the case of dissolution. On the other hand, they must pay their levies due according to the legislation and if they do not pay, a request for payment will be published twice in 15 days in the Romanian Official Gazette.
Joint-stock companies management
Since 2006, the Romanian commercial law implemented a new concept regarding joint-stock company management to meet the European Union regulations. According to this legislation, there must be a board of administrators and directors that will realize the management and administration of the joint-stock company, this board is known as the unitary system. On the other hand, the administration can be done through a dual system: the supervisory board and the directorship. One of these two systems will be chosen by the Articles of Incorporation.
Therefore, there are advantages for both systems as follows:
The Unitary system:
- There is only one Board of Administrators that can delegate the leadership of the company to directors. The company can be managed by only one administrator of more (odd numbers only), the Board of Administrators will be formed when there are more than three administrators of the company. The number of administrators is also determined by the Articles of Incorporation. The board must elect a President and none of the administrators can be employees of the joint-stock companies.
- The board must establish accounting policies and financial control systems, determine the main directions of development and activities, supervise directors’ activity, appoint and remove directors, prepare annual reports and implementing the decisions made at the Shareholders General Meeting that they also have to organize.
The Dual system:
- Separates control powers and executive powers
- The Supervision Board controls the directorship’s activities, which are in control of the company leadership and administration. Members of Directorship cannot be employees of the company of members of the Supervision Board, as the Supervision Board assigns them.
- The Directorship must present a report to the Supervision Board every three months
- The Supervision Board must verify the compliance of the General Assembly decisions and management operations to the legislation provided by the Articles of Incorporation and once a year report to the General Assembly of Stockholders regarding their activity.
Contact Romania Company to Get Your New Business Live in 5 Working Days
Romania Company has been providing incorporation services for all industries for over 18 years. We have helped our clients to make the right choices, to realize their visions, to overcome obstacles, and, above all, to succeed. We offer transparency and efficiency and we are committed to always acting only in your interest.
Our experience in obtaining the companies and banking accounts differentiates us from the competition. We cover all your needs, from the incorporation of your company, the creation of fiscal and compliance structures, to obtaining the banking account and operating licenses.
We invite you to schedule a consultation with us. We like to communicate with our customers, troubleshoot their problems, and offer solutions. We invite you to contact us today to discuss this with one of our agents. Let us help you take your business to the next level.
For more information do not hesitate to contact our law firm Romania Company to assist you. We offer a free consultation. Our lawyers in Cluj Napoca have vast experience in supporting local and international companies.
