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Company registration in Romania: micro-enterprise regime

A company in Romania is an alternative to offshore companies. Company registration procedure, corporate structure, collection of necessary documents and annual administration.

Major advantages of doing business in Romania:

  1. 1% corporate tax (for companies with revenue of up to EUR 1 million and at least 1 employee);
  2. Positive image of a European jurisdiction;
  3. Not on any offshore blacklists;
  4. Quick company registration;
  5. Small statutory share capital of just EUR 50;
  6. Local bank account can be opened, with trouble-free transfers to/from offshores;
  7. Quick and affordable creation of substance in the country of registration;
  8. Large network of double tax treaties.

Time frame for setting up business in Romania:

  • Company registration within 2 weeks;
  • Local bank account opening from 2 weeks.

Romanian company registration procedure:

1. You need to decide on:
1. Company name to be checked for its availability (at least two names), such name: - must not be identical or similar to the name of an existing company; - must end with a suffix denoting the type of entity;
2. Company structure (administrator, members);
3. Registered office;
4. Share capital and distribution of shares between members (RON 200, or appr. EUR 50);
5. Activity and geography of business.

2. Payment of fees. At this stage, not only do you need to pay the fees of the registering person (lawyer handling the company registration), but also leave a deposit to cover other expenses, such as notary fees, registration fees, etc.

3. You need to provide documents for administrators / members / attorneys:

  • internal and international passports;
  • proof of address (unless  the internal passport contains an address stamp).

4. Payment of share capital. Money can be deposited either by the shareholders themselves, or by direct wire transfer to a temporary bank account or to the account of the agent handling the registration. The share capital later becomes available for use. Due to a small statutory share capital (appr. EUR 50) it is paid in by the registering agent.

5. Preparing a package of documents for company registration, having the documents signed by directors and members.
To prepare the constitutive documents, it is necessary to provide the following:

  • Confirmation of company name reservation at the Trade Register;
  • Constitutive documents signed by members;
  • Confirmation of depositing the share capital in a bank account;
  • Notarized Declaration by administrator and members of compliance with requirements for administrator and members;
  • Notarized specimen signature card with administrator’s signature;
  • Proof of company having an office to conduct business (lease agreement);
  • Declaration stating the company’s business activity;
  • Due Diligence documents: administration contract, questionnaire, AML declaration.
If a member of the company is a legal entity, then additional documents will be necessary to disclose the entity’s structure and individuals within it:
- Extract from the trade register specifying the entity’s structure;
- Resolution of member to form a subsidiary in Romania;
- Power of attorney authorizing to sign the constitutive documents and make necessary filings;
- Reference letter from a bank where the entity holds an account.
Company registration documents in Romania are filed in the Romanian language only. The fees for translation, notarization, legalization and apostille are charged additionally.

6.  Filing a company registration application with the Trade Register. After receiving and processing the application, the Registry issues a Certificate of Incorporation. The share capital is now deemed to be unlocked.

The overall time to register a Romanian company is 2 weeks, on average.

STRUCTURE

Administrator

The affairs of a limited liability company in Romania are managed by the administrator. (Administrator is a traditional title for the sole executive body in Romania; it is effectively a Director.) The administrator can only be an individual (either resident or non-resident in Romania). The minimum number of administrators is 1. The same individual can be both administrator and member.

Members

The minimum number of shareholders / members in a company is 1; they can be individuals or legal entities; there are no statutory requirements as to their residency. The maximum number of members is 50.

Restrictions

An individual cannot be the sole member of more than one limited liability company in Romania. A sole-member limited liability company cannot be the sole member of another limited liability company.

Share capital

The minimum share capital is RON 200 (appr. EUR 50) divided into shares of min.  RON 10 (appr. EUR 3) each. It must be paid up by the time of filing the company for registration.

Registered office

Every company in Romania must have a registered office in the country of incorpora-tion. We also assist with setting up an office and establishing substance in Romania.

Micro-enterprise regime. Can a micro-enterprise be regarded an “EU offshore”?

Romania has the most attractive tax regime for small businesses in the EU. A company is a micro-enterprise if its revenue in the past years did not exceed EUR 1 million. The corporate tax rate will be:

  • 1%, if the company has at least one full-time employee;
  • 3 %, if the company has no full-time employees.
To assess the company’s tax burden, we recommend seeking tax advice (which can be arranged upon request).

 

Fees[1]

Services Fees (EUR)
Company registration in Romania and 1st year of administration
Total cost of a limited liability company incorporation with one shareholder and standard Articles of Association (including preparation and provision of original constitutive documents, compliance fee, and a company seal)

3 850

Minimum share capital 50
Local bank account opening 1 050
Registered office for the 1st year: physical office lease [2] 3 960
Preparing and filing financial statements 100 – 400 / hour
(depending on time spent)
Annual renewal of the company
Annual renewal of the company, including registered office for a year: physical office lease[3] 4 950
Compliance fee

Payable in the cases of:
-           renewal of a company,
-           liquidation of a company,
-           transfer out of a company,
-           issue of a power of attorney to a new attorney,
-           change of director\shareholder\beneficial owner, except the change to a nominee director\shareholder)

250 (standard rate – includes the check of 1 individual)

+ 50 for each additional individual (director, shareholder, or beneficial owner) or legal entity (director or shareholder) if such legal entity is administered by GSL
+ 100 for each additional legal entity (director or shareholder) if such legal entity is not administered by GSL

350 (rate for High Risk companies, including the check of 1 individual)

Preparing and filing financial statements 100 – 400 / hour
(depending on time spent)

 

[1] The fees do not include 19% VAT, which may arise under certain conditions. Please refer to the consultants of GSL Law & Consulting for details.
[2] This fee is not inclusive of physical placement of any employees in the office. However, such placement is possible; the terms, cost and format should be agreed with the consultants of GSL Law & Consulting.
[3] This fee is not inclusive of physical placement of any employees in the office. However, such placement is possible; the terms, cost and format should be agreed with the consultants of GSL Law & Consulting.
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