Business Entities in Romania: Their formation, our expertise

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Before elaborating any further, one can say that forming a company in Romania is most probably a quite standardized process according to which certain criteria have to be met, however none of them can definitely be considered as extraordinary and unexpected.

The most certain criterion that has to be fulfilled is the registration of the newly-fledged company, regardless its size and characteristics, with the national Trade Registry, while at the same time and without any further a-do, the same registration stands for the Fiscal Authorities.

As soon as the registration of the company’s statute has been completed with the Trade Registry, the legal person as such has acquired its legal personality, thus get actually involved in the entrepreneurial life of Romania and the EU.



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National Law 31/1990 is the one governing the business entities of the sort, dealing in essence with every fundamental issue that relates to the formation of the five different types of company formation currently available to be set up in Romania. At the same type with regards to those entities, but also as far as general principles of taxation apply on the Romanian tar reality, a number of information need to be taken into consideration which in a few words read as follows:

  • Standard corporate income is of 16%;
  • If the annual revenue of a certain type of entity which is called micro-company is of a million euros, a beneficial regime of some extreme low taxes shall be applied
  • Elaborating further – and in relation to the just aforementioned – this practically means that a micro-company is taxed only at a rate of only 1% after having hired just one employee
  • Otherwise a micro-company of no employees is taxed on a standard basis of 3% in relation to its annual income
  • 5%, on the other hand, is the tax rate for dividends
  • Having said that, though, it is also vital to know that if the revenues with regards to dividends relate to gambling activities, then that specific rate equals just to 1%

In light of the above one can say without any prejudice whatsoever that the overall tax structure in Romania is quite alluring, especially if one takes also into consideration the fact that the necessary capital for a limited liability company to be established is only that of 45, 00€. On top of that, if a private company is to be formed, NO capital whatsoever is necessary, and it is merely the establishment of an SA that requires a capital share that amounts to 25.000, 00€.

Going back to the establishment of a Romanian Limited Liability Company [LLC], which in plain Romanian reads SRL, it needs to be noted that this is the most favorable of all company formation type when it comes to foreigners who wish to get involved in the entrepreneurial life of Romania, to begin with, because it takes an amount of less than 45, 00€ so as to have it established. Simultaneously, it is a company formation of the sort that its founders are not in any way responsible and liable, merely up to their initial amounts of contributions when actually forming the said company type. Please, also, bear in mind that the company’s capital needs to be divided in shares of 10 RON, e.g. of merely 2+ €.

There is also a certain provision regarding founders/ partners of an SRL who can be up to 50 in number, regardless of them being natural or legal persons.

Please, also, note that an LLC can have one or more Directors with an extensive or merely a very restricted mandate, depending each time on the statute of the Company as such which can be quite flexible; those directors could as well be nationals but also foreigners. Last thing to have in mind is that an LLC can be of merely one shareholder, who at the same time could be employed as the LLC’s only employee; should that be the case, a Labor Contract has to be in place which also needs to get registered with the competent Labor Registration Authority/ Chamber of Romania

Moving further to a different company type, one must not omit to mention the Romanian Joint-Stock Company – or at it is coined in Romanian “Societate pe Actiuni”- which is a type of company that if properly founded, then it is eligible to enter the national stock exchange market. Its structure is quite complex, and its scope is most definitely related to the investment procedure. At least two persons, legal or natural, need to cooperate and the share capital needed cannot be less than that of 90, 000 RON, e.g. practically 19.000, 00€

Its most vital body is the General Assembly, i.e. the body which makes decisions, manages accordingly and in essence, ensures the well-being of such a demanding corporate structure. The kind of decisions that need to be taken on a regular basis practically relates to the following:

  • The company statute,
  • The company seat/ headquarters
  • Terms and conditions relating to the company’s scope
  • Set-up of branches or subsidiaries
  • Share capital formation and management, i.e. by decreasing or by issuing new shares, depending on the time-junction at hand
  • Having said that, it could be provided that a certain person is appointed as Managing Director of the Romanian Joint Stock Company, or it could, also, be that a certain group of people need to cooperate to that effect, thus forming a Board of Directors/ Administrators/ Supervisors with such a mandate at hand

The Collective-Name Company – in Romanian “Societatea in Nume Colectiv” – constitutes, furthermore, another company type which is not, however, especially popular within the Romanian entrepreneurial reality. Once more, at least two people need to partner in order to fulfill a major requirement of such a formation. Despite that, though, it is also of key importance to note that this formation needs not to involve actual tangible money, merely interests which are not transmissible in any way. At the same time, probably the most important characteristic of this company type is the requirement for capital, something which in essence, i.e. both in theory and in practice. means that the company’s creditors shall ultimately turn to the partners as such in order to be compensated should anything goes south.

If we wish to establish in just a few words the way the shareholders are able and authorized to act within the framework of the company at hand, it should be noted that besides the right to manage the company, to receive dividends and make the best of the company’s financial muscle, they are also liable with their own personal belongings, while, in case of liquidation they are the ones entitled to the money collected after such a procedure has taken place accordingly

Another more not so popular company type within the Romanian business realm constitutes the Sleeping Partnership Company – in Romanian “Societate in Comandita Simpla”. In essence it resembles the formation of the Limited Partnership legal entity given that there are two distinctive shareholders within the company, the ones that are liable for the company’s obligations even with their own personal belongings, while there are also the ones who are only liable up to the amount of their contribution to the company’ s share capital. Having said that, it should be noted that there is no restriction, or obligation in terms of a certain number of shareholders, as long as the minimum standard of two partners has been reached, however, at all times, there has to be at least one such partner who shall be liable with his/ her personal property, who, to that end, are also the partners that are allowed and obliged, at the same time, to take decisions and manage the whole of the company’s everyday life. If for some reason the overall liable partners are not so eager of managing themselves the company at hand, they could appoint other-s to act on their behalf; just, for your information and with regards to this last point, please bear in mind that these representatives could be either natural or legal persons/ entities, as long as such an option forms part of the company’s statute

There is also the option of forming a Partnership Limited by Shares – in Romanian “Societatea in Comandita pe Actiuni” – a type of company which is not so popular either within the business realm of Romania. It bears too many identical points like the just aforementioned Sleeping Partnership entity, as for instance the fact that at least two shareholders need to get actively involved, their liabilities, though, completely different in theory and in practice, exactly the way it happens with the “Sleeping” version; however, its main differentiation deals with the capital of the company as such, which in the latter case needs to be in the form of shared capital. In any case, and before getting yourselves any further involved, our Firm could give you an extensive yet thorough heads-up on any of the aforementioned similar formations and guide you through details in case you actually decide to move forward with such a company type. For instance, please do notice that in the latter case a capital of definitely RON 90.000, 00 – which translates in 19.000, 00€- is necessary


Features and Advantages of an SRL established according to the Romanian legal provisions

  • Rapid process of only three days’ time
  • Single-member entities that can be founded even by a foreigner
  • The company’s shares are not to be divided
  • An official address is necessary, as is most of the times the case, for correspondence purposes, let alone for proper registration purposes

Having said just that, we should elaborate a little further on the documents needed when an SRL is to be established in Romania:

  • Statute of the company, along with the certificate of incorporation, both of which need to get registered with the competent National Trade Registry
  • If the ones to have an SRL established are legal persons, please bear in mind that the statutes of these companies respectively need to be registered as such as well
  • On top of that, and in case of foreign entities, necessary Certificates issued by the respective competent authorities have to be provided for, as evidence of their good-standing
  • In addition and regardless of the legal entities being national of foreign, a certificate/ letter of financial liability issued by the competent National Finance/ Tax Authorities has to be presented and submitted accordingly


The situation business-wise in Romania, in terms of actually registered companies and relevant paraphernalia

According to the available data of late 2017 525,660 companies had been registered with the National Trade Registry of Romania. The services sector seems to be the one currently flourishing in the country, with a percentage of almost 46.7% out of the total number of all companies established, which practically translates into 35.4% of the workforce currently employed in all Romanian industries

On the other hand, and in terms of the trade sector, there had been 172.000 registered companies, a number of entities that cannot pass unattended

And if we were to speak a word or two about Bucharest, Romania’s iconic capital, 79% of its workforce is employed in the services sector, while in August 2018, almost half of its population –  that is, one out of two million people – had been practically employed somewhere, marking the word unemployment extinct

For what is worth and just for the sake of clarity, it also needs to be stressed that as per the  2017 available records, practically 73.000 multinational business entities are involved in the local Romanian market, of which merely  a 7,3% has been established by national Romanians, thus the actual Romanian market is foreign-oriented and our Law Firm could be your helping hand once you decide to get yourselves involved in this much too promising EU country, where construction, trade and manufacturing are constantly on rise

Key Contacts

Oikonomakis Christos

Papageorgiou Zoi

Mitrogianni Aikaterini

Zgurov Dobrin

Papadimitriou Margarita

For more information on Business in Romania

Please contact us on 800 11 500500 (Free Phone Number/Assignor Service – 24/7), or

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