Setting-up a company in Romania. Types of company.

When incorporating a company in Romania, one must know there are several available options, each suited to a different business need.

We will hihlight below the most frequently used ones:

1.    Limited Liability Company (SRL):

The most popular company type, especially used for small and medium businesses is the limited liability company.

It requires a minimum share capital of 1 RON (i.e. aprox. EUR 0.2).

The SRL can have up to 50 shareholders, Romanian or foreign. Shareholders have limited liability, meaning their personal assets are protected from business debts.

2.     Joint Stock Company (SA):

This tye of company is typically used for larger businesses or those looking to raise capital through the sale of shares. It is ideal for companies with large-scale operations or plans for public offering.

It requires a minimum share capital of RON 90,000.

It can have one or more shareholders and the liability is limited to the invested capital.

3.    Limited Partnership (SCS):

The limited partnership is often used for businesses with diverse expertise or investment types.

Composed of at least one general partner (with unlimited liability) and one limited partner (with liability limited to their contribution).

4.    Branch office

In addition, a foreign comaony can establish in Romania a branch office in order to conduct its business.

A branch is legally part of the parent company and shares the same legal status; thus, it does not have legal personality and it is limited to the activities carried out by the mother company.

Lastly, one must bear in mind that each company type has different implications for taxes, liability, and governance, so choosing the right structure depends on the size, objectives, and scope of the business.