Romanian Company Setup
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Romanian Company Setup
According to Romanian law, in a local company, both Romanian or foreign investors (and ventures) are equally treated, benefiting from the same opportunities for setting up business operations in Romania by founding separate legal bodies.
These entities operate as independent bodies and are distinct from the legal units of their shareholders or partners. Businesses have their own possessions, headquarters, patrimony, appellation, registered capital, administration, and bank accounts.
Romanian law defines two forms of companies:
- limited liability company “societate cu raspundere limitata” (SRL);
- joint-stock company “societate pe actiuni” (SA);
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A foreign corporation can be a sole shareholder (if SRL) or a foreign company can be a shareholder together with at least one other shareholder which can be a legal entity or private person (if SA). The most frequent types are limited liability companies named SRL.
Any business entity must be incorporated with the National Trade Register Office organized by the Romanian Chamber of Commerce and Industry. The date of incorporation is considered the starting moment of its legal existence. The National Trade Register Office is a public institution mandated to maintain statistical information on business activities in Romania.
The Romanian company incorporation process implies that each business organization should have at least one shareholder for the SRL and two shareholders for SA. One private person can’t own more than one company in which he holds 100% of the shares. Furthermore, one company owned 100% by one private person can’t have 100% in another company. The shareholders can be all non-Romanians, individuals, or companies.
START A NEW BUSINESS
Choosing the Business Name in Order to Start Company Romania
The owner will decide the name of the company, the form of organization (S.A., S.R.L.), and the main activity field in order to reserve the name with the Trade Register Office. It is also important to know that the name reservation is done in the Trade Register Office or online on their website, and this procedure is usually completed within one working day. The name of the company is not allowed to include certain words or geographical suggestions. Some words are also subject to approval from the Government or local councils.
For the case when it is requested to include the word “Romania” in the company name, it is needed to obtain special permission from the Government, and this procedure takes about 30 days. The main condition to obtain this name is that the major shareholder of the Romanian company is a company with the same name as the Romanian company.
But the title of the company which contains the term Romania in its name can be used only together with the entitled shareholder. Obtaining the corporation’s name is the first step necessary to acquire subsequent documents.
REGISTER AN ADDRESS FOR THE BUSINESS
Registered Office – Essential to Set up Business Romania
In order to set up business in Romania, the company needs a registered address which must be the official postal address of the company and the place where the authorities can send official letters and claims, serving as well for tax control procedures. All financial and fiscal documents, registers, company papers, etc. must be archived at the registered office of the business. The registered address used for the Romanian company incorporation procedures must be an updated address, no P.O. BOX address is permitted.
Among other services that we provide, is the registered office facility intended to offer an official address for clients who don’t have a company office.
To prove the existence of the registered address the company needs to have a renting contract, property, or a free-lease contract. Attached to the contract would be added a copy of the property title of the landlord (contract, court decision, or another ownership title). It is very important to know that if the property is located in a building of flats, duplex, etc. the approval of all owners or owner’s association is required.
INCORPORATE A BUSINESS
Share Capital
The business setup process in Romania is almost identical for limited liability companies (S.R.L.) and joint-stock companies (S.A.). First of all, some extremely important documents must be prepared, agreed upon, and signed upon by the investors. These documents are the incorporation contract and/or company By-laws, as applicable, or the articles of incorporation which is a sole document containing all details required by law.
The subscribed capital must be paid upon registration of the company. In the case of a joint-stock company (SA), each shareholder must pay at least 30% of its subscribed capital. The registered capital may be subscribed and rewarded by the shareholders by payment in cash, in-kind, or in receivables.
The initial capital must be subscribed and paid in cash. The law allows in-kind contribution, but cash contribution is compulsory for any type of business organization. The minimum share capital is 200 RON (approximately 42 EUR) for a limited liability company (SRL) and 90.000 RON (approximately 25.000 EUR) for a joint-stock company (SA).
The share capital is divided into shares of equal value. One share cannot be less than 10 RON. Consequently, a 200 RON company can have only 20 shares, which means that 1 share equals 5% of the share capital. In joint-stock companies, 1 share is a minimum of 0.1 RON. Shares cannot be divided.
INCORPORATE A BUSINESS
Certificate of Incorporation
After all the documents are verified, the corporation is registered with the Trade Register by the issuance of a Registration Certificate. This provides a registration Code valid for both the Trade Register and the tax authorities.
The Registration Certificate also contains a license of acknowledgment mentioning that all requirements for commercial activities are accomplished. The corporation comes into existence and it is entitled to conduct its activities from the date of its registration with the Trade Register.
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.
