How to register a Branch

The investors can carry out their business in Romania through one of the forms of organization provided by law 31/1990 and the Romanian Fiscal Code. Among these forms of organization are the branches of companies already established, in Romania or abroad.

What is a Branch?

According to the Romanian law, “branches are dismembered without legal personality of companies and are registered, before starting their activity, in the trade register of the county in which they will operate”.

The main advantages of a branch (sucursala) is that it benefits from the respectability of the parent-company (since it is basically the same company) and transferring the funds between the branch and the parent-company is simpler. The disadvantage is that the parent company is directly liable for any debts or other obligations the branch might have.

What I need to establish a branch of a foreign company?

The following documents are required:

1. The Articles of Incorporation / the statute of foreign legal entities if they are 2 separate documents, together with all amendments to these documents or the updated constitutive act, in a legalized translation made by an authorized translator;

2. Documents attesting to the registered office of legal entities abroad, its object of activity and, at least annually, the value of the subscribed capital (if this information is not found in the documents from point 1 above);

3. Identity documents of the persons authorized to represent the branch (copies certified by the party);

4. The document certifying the right to use the space intended as the branch’s registered office (you can use a virtual office for registration purposese; can offer you a virtual office for a period of 12 months)

5. In the case of branches opened by legal entities that are not governed by the law of a member state of the European Union or the European Economic Area, the annual financial statements of the economic operator are submitted to the trade register at the headquarters of the branch,

6. A certificate, certifying the existence of the company, issued by the register in which the foreign legal entity is registered, accompanied by a legalized translation into Romanian, carried out by an authorized translator;

7. As the case may be, information regarding the fiscal records of natural persons who have the obligation to present the certificate of fiscal records (for Romanian citizens of foreign citizens who have Romanin fiscal residency) or the authentic declaration for personal responsibility of natural persons (foreign citizens who do not have Romanian fiscal residency) authorized to represent the branch , from which it appears that it is not fiscally registered in Romania and, as the case may be, the translation made by an authorized translator of the signature to be legalized by a public notary;

8. The affidavit of the representative of the legal entity that deals directly with the activities of the branch, from which it can be seen that he fulfills the legal conditions for holding this quality;

9. Standard declaration on own responsibility regarding the fulfillment of the conditions of operation/performance of the activity;

10. If applicable, the owner’s association’s opinion regarding the change of destination of collective buildings with housing regime,

11. proof regarding the authorization of the appointed person to fulfill the legal formalities (original);

12. Evidence regarding the payment of legal fees

13. Application for registration Annex regarding fiscal registration;

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The main management structure of the company in Romania is the general meeting of associates / shareholders. The constitutive act establishes the rules for convening and adopting decisions and whether the exercise of the vote can be delegated by special mandate by the associate / shareholder who cannot take part in the meeting. In the limited liability company, each shareholder entitles the holder to one vote in the respective meeting. The general meeting of associates has the following main obligations: ✓ to approve the annual financial statement and to establish the distribution of the net profit. ✓ to appoint the administrators and the censors, to revoke / dismiss them and to discharge them, as well as to decide to contract the financial audit, when it is not obligatory, according to the law; ✓ to decide the pursuit of the administrators and censors for the damages caused to the company, designating also the person in charge to exercise it; ✓ to modify the constitutive act.
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The limited liability company is the most common form of company in Romania, being the legal entity that best serves the interests of investors both from the point of view of the reliability of the activity, and from the perspective of its management. The limited liability company is abbreviated "SRL" in Romania and is the equivalent of the American limited liability company Limited Liability Company (abbreviated to LLC) or the German economic structure "Gesellschaft mit beschränkter Haftung" (abbreviated to GmbH), or the structure called "limited" , the structure used in most Latin American states.
The limited liability company is characterized by:
✓ the character intuitu personae, which means that this economic structure is based on the trust between the associates;
✓ the division of the share capital into fractions called shares, which cannot be negotiable securities;
✓ the liability of the associates is limited to their contribution to the share capital.
The limited liability company may also have a single partner, natural or legal person, of Romanian or foreign nationality, who will be the owner of all shares. Instead, the maximum number of associates is 50 people.
At present, the Romanian law no longer conditions the subscription and payment of a certain amount as share capital.
Through registration, the company acquires legal personality, becoming, under the law, a collective subject of law. The conclusion given by the judge is sent, ex officio, to the Official Gazette of Romania for publication at the expense of the company and to the Financial Administration in whose territorial area is the main headquarters of the company for fiscal registration, mentioning the registration number in the Trade Register .

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