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the conditions for carrying on commercial activities in
The general legal
framework for commercial activities has been established
by the Constitution adopted in 1991.
specifically describes the Romanian economy as a market
economy. According to the Constitution, the state is
bound to ensure the necessary conditions for free trade
and fair economic competition. Therefore, the law of
supply and demand functions in the Romanian economy. The
grounds of this system are ensured by the existence of
private property, which is protected and GUARANTEED .
Article 41 of the Constitution, entitled The Protection
of Private Property specifies (at paragraph 1): "
the right to property and debts of the state are
guaranteed". Private property is subject to the same
conditions and is equally protected by the law,
regardless of the holder of the right.
Within this general
framework there are specific laws regulating various
aspects such as the legal ways to create, obtain
authorization and carry out the activities of a
commercial company, taxes, consumer protection, etc. All
these specific laws comply to the general principles
prescribed by the Constitution.
2. What types
of commercial companies can be created in Romania?
The types of
commercial companies that can be created in Romania are
specified in the Law 31/1990, modified and published in
the Official Monitor of Romania, no.33/ January 29, 1998.
The following types
of commercial companies can be created, according to
Romanian laws: general partenership (societate in
nume colectiv) limited partnership (societate in
comandita simpla) joint-stock company (societate pe
partenership by share(societate in comandita pe actiuni)
company (societate cu raspundere limitata) Each of these types of
companies has specific traits. The choice among these
types is determined by various factors, such as: the way
the entrepreneur conceives the structuring and the
further development of the business, the number of
partners, the starting capital, etc.
should the constitutive documents of a limited liability
company or of a joint-stock company contain?
The Law 31/1990
concerning commercial companies prescribes the contents
of the constitutive documents of a commercial company
needed in order to obtain the authorization. If there are
two or more associates, however, and you want to develop
a functional business and do not want to waste time and
money in lawsuits among the associates, these data are
not sufficient. In reality there is a great number of
lawsuits among associates because of the insufficient
attention paid to the regulating of relations among
associates and to the way the company functions. Thus, if
there are two or more partners, it is necessary that you,
together with an attorney, brainstorm about potential
situations that may occur in the organizing and the
functioning of the company.
In what concerns
the mandatory clauses needed for the authorization, they
first name, the date and the place of birth, the address
and the citizenship of the associates (in case they are
natural persons); the name, the headquarters address and
the nationality of the associates (in case they are legal
type, name, headquarters address and, if the case, the
emblem of the company; the object of activity, also
mentioning the field and the main activity; the registered capital,
subscribed and deposited, also mentioning the
contribution of each associate in cash or in kind, the
value of the contribution in kind and the way of
evaluation, the date when the total subscribed capital is
deposited, the number and the face value of the shares,
as well as the number of shares given to each associate
according to its contribution; the managers of the company, their
prerogatives and the way they are to exercise these
prerogatives; the share given to each associate
in case of profit and loss; secondary headquarters (branches,
agencies, offices or other units without legal
time-span of the company the method of dissolution and
liquidation of the company.
documents of a joint stock company contains all the data
required for a limited liability company with the
- the registered
capital deposited by each partner cannot be less than 30%
out of the subscribed one. The rest of the registered
capital can be deposited within 12 month from the
registering of the company.
- the constitutive
documents of a joint stock company will also have to
specification if the shares are nominal or not; if
different categories of shares exist, the number, the
face value and the rights given by each category will be
mandatory guarantee the manager must deposit; the surname, the first
name, the date and place of birth, the address and the
citizenship of the auditors (if they are natural persons);
the name, the address of the headquarters and the
nationality of the auditors (if they are legal persons).
4. Which is
the minimal registered capital of a limited liability
company? How about a joint stock company ?
registered capital of a limited liability company (societate
cu raspundere limitata) is of 2 million lei.
registered capital of a joint stock company (societate pe
actiuni) is of 25 million lei.
5. How can an
associate be excluded from the company?
must be made. Thus, the issue of excluding an associate
appears only in the case of a general partenership, of a
limited partnership or of a limited liability company; in
the case of a limited partnership by shares, the issue
regards only the active and responsible partners and not
the silent partners. The shareholders in the joint stock
companies who paid for their shares cannot be excluded,
as the basis for the functioning of these companies is
the capital and not the person.
associates in general partenership, in limited
partenership, in limited liability company, as well as
the active and responsible associates in joint stock
sleeping partnership companies can be excluded. The
reasons for their exclusion are provided by the Law 31/1990,
republished with further modifications.
The exclusion can
be decided by a Court, at the request of the company or
of any of the associates.
The final decision
of exclusion will be filed within 15 days at the Office
of the Register of Commerce in order to be registered.
The decision will be published in the Official Monitor.
6. How can I
withdraw from a limited liability company of which I am
The associate can
withdraw from a limited company in the following cases:
prescribed in the constitutive documents; upon the agreement of the
other associates; if the constitutive documents do
not prescribe the cases regarding the withdrawal or if
the unanimous agreement of the other associates is not
achieved, the withdrawal can be made for well-grounded
reasons upon the decision of the Court; In what concerns the
worth of the share you are entitled to receive, this is
to be established: upon settlement among the
associates or by an expert appointed by them; when a settlement cannot
be achieved, by a competent Court.
7.I intend to
expand the activity of the company by creating sub-companies
(filiale) or branches (sucursale). What is the difference
between the two and which type should I choose to set up:
sub-company or branch?
The main difference
between them consists in the fact that the sub-companies
posses independent legal personality while the branches
are dependent parts of the "mother" company,
having no legal personality.
Therefore: the sub-companies are
companies distinct from the "mother" companies;
they engage in legal relations on their own behalf, they
take on rights and obligations on their own liability.
Sub-companies can be created as a commercial company
according to the provisions of the Law 31/1990 regarding
the types of commercial companies, under the conditions
and having the legal status prescribed for that specific
type of commercial company. Although an independent
company, the sub-company is however under the control of
the "mother" company which has the majority of
the registered capital. the branches do not have
independent legal personality, do not engage in legal
relations on their own behalf and the liability extends
to the "mother" company. The creation of
branches is done in the conditions prescribed by the
constitutive documents and they are registered in the
Register of Commerce from the county where they will
function. If the constitutive documents does not
stipulate anything concerning the branches, a general
meeting of the associates is needed in order to dispose
of the modification of the constitutive documents.
would be better to create, a sub-company or a branch, it
cannot be said what would be best. The choice is done
according the features and the type of business to be
developed. The corporate development and extension of the
company imposes the creation of various company
structures, not only sub-companies and branches, but also
agencies, bureaus, other secondary headquarters and work
units. Only after a thorough analysis, together with a
specialized jurist who understands the business
mechanism, the way that fits best to the pursued ends can
8. What is
the difference between a limited liability company and a
The general legal
framework is established by the Law 31/1990 concerning
commercial companies. This stipulates various specific
provisions for each type of company, from the point it is
constituted to its liquidation. The main differences
between a limited liability company and a general
partenership is given, however, by the responsibility of
the partners and by the registered capital. Thus: In a general partenership
(societate in nume colectiv) the associates shall have an
unlimited and joint liability for the company's
obligations; the creditors of the company may sue the
company in order to recover the credit given; if the
company does not pay within 15 days, the creditors may
then sue the associates. In the case of limited liability
companies (societate cu raspundere limitata), the
associates may be kept liable only up to the value of
their subscribed registered capital. In the case of limited
liability companies (societati cu raspundere limitata)
the law prescribes a mandatory minimal amount of
registered capital. In the case of general partenership (societati
in nume colectiv) there is no minimal limit of registered
9. If an
associate decides to withdraw from a limited liability
company, what is the legal procedure to be followed?
It depends if the
other associates agree or do not agree with the
If there is an
agreement of the other associates, the constitutive
document will be modified, respecting the substantial and
the formal conditions for its being signed. This means
that the associates will conclude an additional act that
will register the withdrawal, as well as the other
modifications of the constitutive documents that the
withdrawal presupposes: registered capital, the way it
will be distributed, the sharing of the benefits and
losses among the remaining associates, etc. The
additional act that modifies the constitutive document is
authenticated with a public notary and filed at the
Register of Commerce in order for it to be registered.
After that it will automatically be sent to the Official
Monitor in order to be published at the expenses of the
If there isn't a
unanimous agreement the associate may withdraw for well-grounded
reasons upon the decision of a Court.
One of the shareholders is deceased. The shares are
nominal. What can be done in order to transfer the shares
to the successors of the late associate?
First of all, the
quality of successor must be proven.
Thus, following the
decease, succession will be open. The successors will
receive an abstract share of the inheritance. After the
distribution among the successors, proportionally to the
percentage each one has, each successor becomes exclusive
owner of some goods. In this sense a successor's
certificate is issued.
According to the
Law 31/1990, joint stock companies must keep, with the
help of the Council of Administration, a register of the
shareholders that specifies the surname, the first name
and the address of the shareholders.
If, on the basis of
the successor's certificate you become a shareholder,
solicit the company your registering in the register of