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Romania Company Formation


A company according to the Romanian law, 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.

The Romanian law defines two forms of companies:

  1.     limited liability company "societate cu raspundere limitata" (SRL);

  2.     joint stock company "societate pe actiuni" (SA);


A foreign corporation can be a sole shareholder (in the case of the SRL) or the foreign company can be a shareholder together with at least one other shareholder which can be a legal entity or private persons (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.

 Quick Facts  
  Types of companies
which can be started by foreigners

Private limited liability company (LLC/SRL)

Public limited liability company (SA)

Minimum share capital

for LTD Company 

1 RON

Minimum number of

shareholders for Limited Company 

 1
Time frame for the incorporation 

7 days

Corporate tax rate 16%
Dividend tax rate 

0% or 5%

VAT Rate 

19% standard rate

5% and 9% reduced rates

Number of Double Taxation Treaties (approx. ) 90 
Do you supply a Registered Address/Virtual Office?   Yes 
Local Director Required   No
Annual Meeting Required  Yes
Redomiciliation Permitted  Not specifically provided for 
Electronic Signature  Yes 
Is Accounting/Annual Return Required?  Yes 
Foreign-Ownership Allowed  Yes 
 Any Tax Exemptions Available?  Corporate income tax reduction, applicable between 2021 and 2025, subject to certain conditions 
Any Tax incentives (if applicable)   Deductions for qualifyign R&D activities, subject to conditions

Types of companies in Romania

 
The two business forms previously mentioned, the SRL and the SA company are the types of corporations that can be incorporated by local and foreign investors in Romania. Understanding the particularities and the advantages of each business form is essential before starting the actual registration process. Our team outlines some of the most important issues below:
 

  • Capital: there is no mandatory minimum for the SRL, while the minimum share capital for the SA is substantial;
  • Number of shareholders: the SRL requires one shareholder and can have a maximum of 50, while the SA needs at least two shareholders and it can have an unlimited number of shareholders;
  • Capital: the SRL cannot have its capital through public subscription, while this is a choice for the SA capital, including for the initial capital;
  • Meetings: the SRL has the general meeting of shareholders, however, the SA can also hold an extraordinary shareholder’s meeting in addition to the general one, as may be the case; the conditions for the quorum and the majority for decisions made within general meetings is also different;
  • Management: the SRL company can have a sole administrator, if this is suitable, however, the SA company is subject to different conditions and it can opt for unitary management (one or more directors who form the Board) or a two-tier system (when the company has a Supervisory Board as well as a Directorate).


As understood from the differences outlined above, the SRL company is suitable for small and medium enterprises (including the Romanian micro company regime), while the SA company is the preferred business form when opening a large entity or a company that will be publicly listed.
In practice, the Romanian Commercial Code also allows for the creation of the joint stock limited partnership (SCA company, which shares similarities to the SA company), and the European Company (also referred to as the SE company).

The main laws and regulations that govern the establishment of the different types of companies in Romania, along with their control, taxation, and other provisions, are the Commercial Code, the Civil Code, and the Fiscal Code, among others.

Our company formation experts can give you more information about the types of companies in Romania, their advantages and particularities. 
 

The steps required for Romania company formation

 
Our team highlights the main requirements for registering a limited liability company, the SRL. This is the most commonly used business form in the country as it offers a number of clear advantages: simple incorporation with low capital contributions, as well as complete separation from its founders. What’s more, a qualifying SRL can be subject to a very advantageous taxation regime, as detailed below in this article by our experts.
 
The main steps for open a SRL in Romania are the following:
 

  1. Check the name availability: this is a key pre-registration requirement as any company in the country needs to have a unique name; the application for the name check includes 3 desired names, in the order of preference;
  2. Prepare the documents: the company’s constitutive documents, the Articles of Association, which will include the approved name, the type of company, the number of shareholders and their identification details, the main object of activity and the secondary objects of activity and other details;
  3. Proof of payment: this is the fee for the publication in the Romanian Gazette and the fee is 122 lei/manuscript page;
  4. Register: once all of the documents are complete the founders fill in the application form and submit the application for registration with the National Trade Register Office.

 
Investors should also know that they are required to submit a statement attesting to the real beneficiary of the company. The company representatives will also provide their specimen signatures and a sworn statement that they comply with the legal requirements for fulfilling their role (having no criminal record and other requirements). When one of the shareholders is a legal entity the respective company’s articles of association will also need to be submitted.
 
You can read below more about each of the mandatory requirements when opening a company in Romania. When there are differences between the SRL and the SA company, our team highlights these.
 
Talking to one of our agents before commending the Romania company formation process is advisable in order to make sure that you have a complete list of documents for submission. You can thus rest assured that your application will be processed and not rejected due to incomplete documentation.
 

Romanian company shareholders


The Romania company incorporation process implies that each business organization should have at least one shareholder for the SRL and two shareholders for SA. One person cannot have more than one company in which he/she holds 100% of the shares. Furthermore, one company-owned 100% by one person cannot have together with its sole shareholder 100% in another company. The shareholders can be all non-Romanians. The shareholders can be individuals or companies.

We invite you to watch a short video about the main requirements for company creation in Romania:

 

Choosing the Business Name in Order to Start Company Romania


The customer decides the name of the company, the form of organization (S.A., S.R.L.) and the main field of activity in order to reserve the name with the Trade Register Office. It is also important to know that the name reservation is done with the Trade Register Office and this procedure is usually completed within one working day. The appellation must not include certain words or geographical suggestions. Some words are also subject to approval from the Government or local councils.

In order to start company Romania, individuals should know that for including the word "Romania" in your company name you need to get permission from the Government; this procedure takes about 30 days. The main condition to obtain this name is the following: the major shareholder of the Romanian company has to be a company with the same name like 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.

Registered Office - Essential to Set up Business Romania


In order to set up business 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 Romania company incorporation procedures must be an up-dated address, no P.O. BOX address is permitted.

Among other services that we provide we included also the registered office facility intended to offer an official address for clients who don't have a company office.

The registered address is proven with a renting contract, property, or a free-lease contract. To the contract there shall be added the copy of the property title of the landlord (contract, court decision or other ownership title). For all clients who intend to start a company in Romania it is important to know that if the property is situated in a block of flats, duplex, etc the approval of all owners or owner's association is required.

What are the share capital requirements?


The inscription process necessary to set up business 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 and signed by the investors.We mention here 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.

Furthermore, 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 was 200 RON, however, this was abolished starting with November 2020. The minimum share capital for the joint stock company (the SA company) is at least 90.000 RON, adjusted as to represent the equivalent in lei of approximately 25.000 euros.  If this minimum capital payment for the SA is not submitted in its entirety upon registration, the founders have 12 months from the registration date to submit the rest of the capital value in cash. The period can be longer if the rest of the amount is paid in kind.
 
If you wish to know more about the requirements for the share capital of the SA, as these are subject to more complex rules compared to the ones for the SRL, our Romanian company formation specialists can give you more information.

When is the certificate of incorporation obtained?


In the end, the corporation is registered with the Trade Register by 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 acknowledgement 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.

What are the main taxes for companies in Romania?

 
The SRL and the SA companies need to fully observe the provision regarding taxation in Romania, imposed by the National Agency for Tax Administration, under the Ministry of Finance.
 
The corporate income tax rate has a standard value of 16% and small qualifying companies can be subject to the micro company regime, under which they are taxed on their revenue at rates of 3% or 1% (if they meet the criteria to have at least one employee). Corporate income tax returns and payments are due on a quarterly basis and the annual corporate income tax is payable by the 25th day of the third month in the next tax year.
 
An advantage for foreign investors interested in Romania company formation is that their newly formed SRL company can, for example, initially, qualify as a small company and be taxed as a micro company because of the fact that the criterion for eligibility is for the company to have a turnover below EUR 1 million. If you need to know more about the micro company regime, our tax specialists can provide more information.
 
Our team can give you more details about each of these requirements and they can help you throughout the registration process. Company formation in Romania has become more attractive to foreign nationals, especially as the business environment is encouraging and permitting foreign ownership and because of the fact that the limited liability company can be incorporated with only 1 leu. This is also reflected in the  number of companies: 
 

  • The total number of companies incorporated in Bucharest in 2023 was 6.98% higher than in 2022;
  • As far as company types are concerned, the SRL (private limited liability company) remains the most popular business form in Bucharest and in the rest of the country; the data for Bucharest shows that the total number of SRL companies registered in 2023 was 21.812, compared to 52 SA companies;
  • The most recent data, for January 2024, indicates that there were 1,925 SRL company registrations and 1 SA company registration was also recorded in Bucharest;
  • The total number of companies registered in January 2024 (including SRL and SA companies sole traders, and other business forms) is 2,630 which represents a 12.83% increase compared to the same period a year prior.

 
Data from the National Trade Register also indicates that most types of companies in Romania registered throughout the country will activate in the wholesale and retail trade; repair of motor vehicles and motorcycles sector, followed by companies in the information and communication sector.
 
Following the steps for company formation in Romania with the relevant authorities and obtaining the needed permits and licenses according to the NACE codes is mandatory. With our assistance, the process to register a company in Romania can be simplified and handled partly of wholly by our experienced team.
 


For any further details or information on company registration and company compliance please do not hesitate to contact us. Our team can answer any additional questions, as well as provide complete, professional assistance during the pre- and post-registration stages.

by Cristian Darie

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