The Romanian business environment

Student: Musuroi Rodica IoanaGrupa 8214Profesor: Mihai Daniel Frumușelu

Information about the Romanian Business Environment

Company Law, which has been modified several times since it came into force, allows and defines five forms of companies: This section outlines the various business organizations that exist in Romania and will provide you with the main characteristics of each of these forms of companies.

• Limited liability company

• Joint stock company

• General partnership

• Limited partnership

• Limited partnership by shares

Limited liability company

A limited liability company may be established by one or more entities, either individual or legal. Restrictions exist with respect to the number of shareholders of a limited liability company, as well as the number of limited liability companies one can establish by himself.

Joint stock companyA joint stock company can be formed by at least 5 shareholders (there is no maximum number of shareholders stipulated in the Company Law).Decisions are made by majority vote in the General Meeting of Shareholders, in accordance with the general principle that 1 share equals 1 vote. Shareholders may, however, impose restrictions on the number of votes that a shareholder owning more than 1 share is entitled to.The company is managed by one or more administrators and it should also have at least three internal censors, or an independent auditor.

General partnership

Under Company Law there are three types of partnerships: General partnership The major feature of a general partnership is that all partners are jointly and severally liable with the other partners without any limit. The liability exists only for the period the partner is a member. Two limited liability companies are allowed to form a general partnership.

Limited partnership

In the case of a limited partnership, at least one partner faces unlimited liability (see above on general partnerships) while at least one other partner must exist who is liable only for the amountof its contribution to capital.

Limited partnership by shares

The obligation of the partners is restricted to the amount of their contribution to the registered capital of the partnership.

The Romanian law allows also foreign investors to form, in Romania, branches, permanent establishments or registered offices.Approximately 98% of the businesses in Romania are conducted via limited liability companies, or joint stock companies. Investors, either domestic or foreign, usually prefer a limited liability company when they decide to set up a small or a middle sized business in Romania, especially if the company will be managed by its shareholders, while the joint stock companies are usually, but not always, large companies with more widely dispersed ownership.

Irrespective of its legal form, a company becomes a legal entity upon its registration with the Romanian Trade Register Office, where certain legal formalities have to be followed, including a delegated judge’s decision and the granting of the fiscal code of the new company.

Bibliography

https://www.google.rohttps://scholar.google.rohttps://wikipedia.org/wiki/The/Romanian/business/environment