Starting and developing businesses in Romania – Part I

An important chapter for starting and developing businesses in Romania is that of understanding the structure and functioning of companies in Romania, at least at a reference level that allows the best strategic decisions to be taken.

The first analysis will be dedicated to the most complex business structure, which is mandatory to develop certain businesses in Romania, such as consumer credit activity (NFI).


A joint stock company is a legal entity whose share capital is represented by shares with a nominal value of at least 0.1 RON and a total value of 25,000 EURO (RON equivalent).

Shares are ideal fractions of the share capital having the following characteristics (without being an exhaustive list):

– they grant the owners equal voting rights;

– they represent securities;

– they can be mortgaged to guarantee a debt of the shareholder who owns them;

– can be traded on the capital market;

– may be acquired by the issuing company either directly or through a person acting in his own name but on behalf of that company. Under this method, own shares may be distributed to the company’s employees within 12 months of the date of acquisition.

The shares may be ordinary shares or preference shares without voting rights. However, preference shares may not exceed one quarter of the share capital and will have the same nominal value as ordinary shares.

Preference shares and ordinary shares may be converted from one class into the other by resolution of the extraordinary general meeting of shareholders.


General meetings of shareholders are ordinary and extraordinary and are the supreme governing body of the company.

The ordinary general meeting meets at least once a year, at the latest 5 months after the end of the financial year, to adopt the financial statements, to elect and dismiss the members of the Board of Directors, the Supervisory Board and the auditors, to establish the income and expenditure budget and, where appropriate, the work programme for the following financial year, to decide on the pledging, leasing or closure of one or more units of the company, and to discuss and adopt other items on the agenda of the convocation.

The presence of shareholders holding at least one-fourth of the total number of voting rights is required for the deliberations of the ordinary general meeting to be valid. Resolutions of the ordinary general meeting shall be passed by a majority of the votes cast. The constituent instrument may lay down higher quorum and majority requirements.

The right to decide on certain matters relating to the day-to-day running of the company may be delegated to the Board of Directors or the Executive Board, as appropriate.

Extraordinary General Meetings shall be convened whenever necessary for the adoption of decisions other than those referred to in the legal provisions applicable to Ordinary General Meetings.

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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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