What are the types of contracts in Romania?

What types of contracts are available for the construction sector in Romania?

Investors who are involved in the construction sector in Romania should be aware that there is no specific type of contract for this sector. However, when it comes to large construction projects, such as infrastructure projects, the companies involved have to draw up and sign the standardized forms required by local legislation; our law firm in Romania can show you the main types of contracts available in this case.

If the construction project concerns a publicly funded project, there are two types of model contracts to be drawn up. Such contracts have been created by the Ministry of Regional Development, Public Administration and European Funds, following European Commission regulations.

What does a real estate sales contract contain in Romania?

Contracts in Romania can also be signed when selling real estate for commercial or residential purposes; our Romanian lawyers can present the characteristics of each type of contract and it is also necessary to know that before signing a sale contract it is highly recommended to carry out due diligence procedures.

In the case of a contract for the sale of a commercial property, the document must provide information about the parties who will conclude the contract (the seller and the buyer), the subject of the contract (in this case, the commercial property), with details of the property itself, the cadastral number of the property and the price at which the property is sold.

At the same time, the contract must also state the means of payment agreed by the parties and the deadline by which the buyer must complete the transaction. It must also include clauses on termination of the contract and other similar provisions. Please contact our law firm in Romania for detailed information on other provisions relating to this type of contract; our lawyers in Romania can help you with advice on any type of contract that is required by local law.

International contracts in Romania

As the Romanian Civil Code allows the parties to determine the content of a contract, it is obvious that, in the case of an international contract, they could choose the law applicable to the contract.

The law stipulates that the applicable law must be expressly stated or clearly apparent from its content or circumstances. There are two ways in which the parties can express their will: an explicit choice (by actually mentioning this information in the contract or in an annex) or a tacit choice. The elements used to infer a possible tacit choice of the parties are the following:

  • the use of legal concepts or institutions specific only to a particular legal system.
  • reference to a procedure used only in a particular country may place the contract in that legal system;
  • signing the contract in a particular language may indicate a choice of the parties, but this is not considered very relevant;
  • the choice of a particular court in a country is not considered very relevant.
  • If the parties have not expressly or tacitly designated an applicable jurisdiction to govern the contract, the court will have to make a decision to that effect on the basis of objective criteria.

The main criterion is the application of the law of the State with which the contract has the strongest connection. This is a more recent solution, an influence of Anglo-Saxon law (the notion of “proper law”). For example, a contract has a stronger connection with the law of the state where the debtor has – at the time of performance of the contract – his domicile/legal seat.

The secondary criterion will be the application of the law of the place where the contract is signed. If the contract is signed by the parties by correspondence, it is deemed to be signed in the State of the party who initiated the offer to contract, which offer was accepted.

The Legality team can assist you both in the process of deciding on the procurement strategy or establishing the legal relationship with contractual partners and in drafting the contracts necessary to materialize the legal relationship. Our team of Romanian lawyers has more than 23 years of experience in this field.

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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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