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Open your company in Romania

by | Oct 18, 2022 | Corporate Structuring

Open your company in Romania

Romania is one of the fastest developing countries in the European Union for the past few years respecting the economical environment, therefore being an ideal choice for new foreign investors looking to start a company in the EU.
Company formation in Romania has many advantages such as a uniform tax rate of 16% which can be decreased to as low as 1% for small companies. Romanian company incorporation and maintenance costs are quite reasonable and the minimum share capital for a limited liability capital in Romania is quite low.

Benefits of setting up a company in Romania

• A good location: Romania‘s geographical location can be considered strategic for transportation and import/export purposes. It is also an easy gateway toward the Middle East. Also, other European Union markets are easily accessible.
• Ease of Doing Business: a Company can be easily established in Romania with minimum ease. An LLC in Romania can be established within two weeks.
• European Union: Romania is a part of the European Union, thus, the four freedoms are enjoyed by businesses in Romania which comprise goods, services, capital, and people.
• Cheap Labour: the cost of labor in Romania is very reasonable.
• Corporate Tax: the corporate tax charged in Romania is quite less when compared to other member states.

Business Structures to open your company in Romania

• Joint Stock Company (Societate pe actiuni – S.A.): this form of entity is similar to a public limited company, which offers its shares in a public stock exchange. One or more directors are obliged to form this type of entity. This entity has to have an executive board and a supervisory board. There are unique provisions present for joint stock companies in Romania.

• Limited Liability Company (Societate cu răspundere limitată – SRL): this form of entity has the principle of limited liability which is different from its members and directors. Up to 50 shareholders can be allowed to form this type of company. But an individual cannot be a shareholder in more than one LLC.

• Branch (Sucursala): a branch office is just an extension of a foreign parent company. Profit-making activities can be conducted by a branch office and the branch office must file yearly returns and corporate tax returns as required by the applicable regulatory authority.

Incorporation Process of a company in Romania

The most popular company status in Romania is Limited Liability Company and its main features in Romanian are:
• the number of partners must not surpass 50
• it’s Partners may be Romanian or foreigners
• It is possible to create a Romanian LLC with a sole partner
• the transfer of shares is free of charge among partners but employs the consent of three-quarters of the partners when transferring to third parties
• the assignment of an auditor is necessary if the number of partners is more than fifteen

Documents needed to form a company in Romania

• Articles and Memorandum of association
• Resolutions of the board of directors
• Resolutions of the general meeting of shareholders
• Shareholders’ register
• Passport information and Visas of Foreign Directors and Members.

Steps to register a company in Romanian

The process of incorporating a company in Romanian with the status of an LLC involves the following:
• Preparation and drafting of the articles of association
• Obtaining proof of domicile for the registered office
• Depositing the share capital with a bank
• Registration with the Trade Register and obtaining the sole registration code from the Trade Register.
• Opening a separate bank account for the company
Note that the provided documents must be translated and authenticated if the partners or the director are foreign citizens.

Romanian VAT Registration

After the incorporation of the company, in order for business owners to be able to create their activities securely and legally, there are a few factors related to VAT registration that must be clarified. Holders of companies must get well informed and they must meet specific conditions if they decide to register for VAT, as provided by the VAT registration procedure.
The current VAT rate in Romania is 19%.

Registration with the Register of Intra-Community Operators (ROI)

Romanian companies who are considering carrying out intra-community operations must request their registration with the Register of Intra-community Operators to collect an intra-community VAT number, before carrying out the applicable transactions.

Corporate income Tax in Romania

The standard rate of corporation tax in Romania remains 16%. But, registering a company in Romania that has an annual revenue of less than €1,000,000 will be considered a micro-company with a lower Corporation Tax rate of 1% for micro-companies with one or more employees and 3% for micro-companies with no employees.

Do you require additional information or needed help with your company formation in Romania? – Let’s go ahead and contact your Damalion expert now.

Damalion

Open your company in Romania — legal forms, share capital, directors & UBO, tax registrations, permits, bank account, and practical timelines.

For entrepreneurs, investors, family offices, holding companies, SPVs and international groups • We help you scope, prepare and coordinate with vetted providers. Approvals remain at the sole discretion of authorities and financial institutions.

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Quick overview

Romania welcomes foreign founders. Most choose an LLC (SRL) for speed and limited liability. Expect notarial incorporation, trade register filing, tax/VAT numbers where relevant, and a business bank account. Clear ownership charts and basic compliance (KYC/AML) are standard.

Common legal forms

Form Use case Capital Governance highlights
SRL (Societate cu Răspundere Limitată) Most SMEs, tech, services, trading From RON 1 (customary higher) 1+ shareholders; 1+ directors; quotas not freely transferable without formalities
SA (Societate pe Acțiuni) Larger ventures, listings, complex cap tables RON 90,000 minimum (statutory) Board/dualistic models; audited accounts; higher formalities
PFA/Authorized individual Self-employed professionals n/a Personal liability; simpler accounting
Branch / Subsidiary Foreign group presence n/a Branch has no separate legal personality; subsidiary does (usually SRL)

Exact thresholds are set by Romanian law; market practice often opts for a modest but practical SRL capital to support early operations.

Documents you will typically prepare

  • Founders’ IDs and recent proof of address; corporate founders add certificate of incorporation and good standing.
  • Articles of association (SRL/SA), registered office evidence (lease, domiciliation contract).
  • Directors’ acceptance statements and specimen signatures where required.
  • UBO declaration and ownership chart.
  • Business description: activity codes (CAEN), suppliers/clients, expected turnover, countries.
  • Tax registrations (CIF), VAT registration where applicable; EORI if importing.
  • Bank account onboarding pack including source of funds and expected payments.

Registrations and permits

  • Trade Register filing with required forms and annexes.
  • Tax ID; VAT optional/mandatory depending on thresholds and activity.
  • Sectoral licences where applicable (transport, food, construction, financial services, healthcare).
  • Ultimate Beneficial Owner filing where required by Romanian law.

Bank account and payments

Local banks request a clear profile: purpose of account, payment volumes, currencies, counterparties and countries. Be ready with ownership evidence and a simple activity note. Multi-currency is available at many institutions. Remote/on-site onboarding depends on each bank’s policy.

Tax points at a glance

Area SRL SA
CIT Standard corporate income tax (check current national rate and micro regime eligibility) Standard CIT
VAT Standard and reduced rates apply; registration thresholds and special schemes may apply Same
Withholding Treaty-dependent; EU directives may apply intra-EU Same
Payroll Employer/employee contributions as per Romanian law Same

Always align with current Romanian fiscal rules and any applicable EU directives. Independent tax advice is recommended for cross-border structures.

Timelines and costs

  • Drafting & filing: usually fast when documents are complete and registered office is arranged.
  • Registry turnaround: from a few days to a couple of weeks depending on filings and follow-ups.
  • Bank onboarding: varies by profile and policy.
  • Cost drivers: notarial/legal drafting, registry fees, translations/apostilles, registered office, accounting, and banking fees.

Frequently asked questions

Can a non-resident own 100% of a Romanian SRL?
Yes. Foreign shareholders may own 100% of an SRL subject to general restrictions (sanctions, AML/KYC). No local shareholder is required.
Is a Romanian registered office mandatory at incorporation?
Yes. An address in Romania must be evidenced (lease, ownership, or domiciliation) and recorded at the Trade Register.
What is the minimum share capital for an SRL?
Statute permits very low nominal capital (RON 1+). Many founders choose a practical amount to support operations and banking.
What is the minimum capital for an SA?
RON 90,000 minimum as provided by law. Additional market or regulatory requirements may apply for regulated activities.
Are directors required to be Romanian residents?
No general residency requirement. Banks and certain licences may prefer local management presence depending on activity.
Is a notary required for incorporation?
Yes for SRL/SA deeds and related corporate acts. The notary verifies identity and corporate approvals where relevant.
How are UBOs declared?
UBO information is filed according to Romanian law. Updates are filed upon changes in control or ownership.
Can the SRL have a single shareholder and single director?
Yes. Single-member SRLs are permitted. Certain conflict-of-interest and corporate law rules still apply.
When is VAT registration required?
VAT registration is mandatory once thresholds or activity conditions are met; voluntary registration is possible for input recovery.
Are financial statements public?
Yes. Annual accounts are filed and become public records in accordance with Romanian accounting and filing rules.
Is an audit mandatory?
Audit depends on thresholds, legal form, and specific criteria (e.g., SA). Many SRLs are unaudited unless limits are exceeded.
Can I convert an SRL into an SA later?
Yes, by corporate resolution, capital adjustments, and registry filings following Romanian company law.
How are dividends taxed to non-resident shareholders?
Withholding applies per local law; treaty rates or EU directives may reduce or eliminate withholding if conditions are met.
Can the company open foreign currency accounts?
Yes. Multicurrency accounts are common. Bank policy applies on onboarding and activity monitoring.
What CAEN code should I choose?
Choose the CAEN activity code(s) matching actual operations. Some codes trigger licences or special compliance.
Is remote incorporation possible?
Frequently yes via powers of attorney and digital steps accepted by the notary and registry. Exact feasibility depends on the file.
Do employment contracts need a local payroll setup?
Yes. Romanian labour, payroll taxes and social contributions apply to Romanian employment relationships.
Are intra-group loans subject to transfer pricing?
Yes. Arm’s-length principles and documentation obligations apply above thresholds or risk profiles.
What happens if the registry requests clarifications?
Provide the missing items (translations, legalizations, additional evidence). Deadlines must be respected to avoid rejection.
Can a bank decline without disclosing reasons?
Yes. Each bank applies its own risk policy and may decline an application. Another bank may assess the file differently.

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