Menu
Expat.com

Starting a business in Romania

Setting up a business in Romania
Shutterstock.com
Updated byAnne-Lise Mtyon 04 March 2020

Romania is one of Eastern Europe’s most colourful and exciting destinations for starting a business. The reasons are multiple. The location, meaning the proximity to the Middle Eastern Markets through the port on the Black Sea, the resources (oil, gas, timber) and also the population itself are few of the reasons why Romania is welcoming the foreign entrepreneurs. Also, Romania is the 2nd country where there is a great number of people who are speaking foreign languages, after Holland. Through this article, expats will find the conditions for opening a business in Romania, the types of companies and the steps to setting up a new company. 

Conditions and benefits of opening a business in Romania

Today, Romania has the reputation of an international business hub. Also, the government of the country has taken further steps for encouraging and developing investment and the growth of the Romanian economy. Therefore, the GDP per capita has increased in 2019 to $2,786.

The benefits of opening a business in Romania are multiple and very tempting for expats:

  • Advantageous geographical location: between Europe and Asia, Romania is open to the sea, with a generous border formed by the Danube River. The Constanta Port links to three pan-European transport corridors.
  • Low costs for opening a business: the income in Romania is one of the lowest in Europe, which also means low costs in the EU for business operations.
  • Low Corporate Taxes in Europe, meaning 16% in Romania and a great number of double taxation avoidance treaties. This makes it easy to start a business in IT, transportation and other business that are easy to manage from abroad.
  • Foreign languages on a large scale. There is asignificantg number of Romanian people who are speaking English, as well as French or other foreign languages. Romania occupies the 2nd place in Europe, after the Netherlands, regarding this topic. This is the reason why many outsourcing firms have expanded in the country, such as HP, Oracle, Wipro, Depot, and others.
  • Many different types of specialists. Although the education system in Romania is still old-fashioned, it produces well-trained specialists in lots of fields. The IT field is the best example. 
  • General openness to foreign capital and investors. Banks in Romania are open to foreign investors. Generally speaking, foreign shareholders are very welcome in this country. 

Types of companies to open in Romania

For those who are looking for setting up a new business in this European country, well, they should know about the four types of companies they can open here: 

  • The limited liability company, which requires a maximum of 50 partners and a minimum capital of 200
  • The public company, which requires approx 19,4000 euros needs at least two parts
  • The partnership, with at least two partners and no minimum capital
  • Single sponsorship company, with one limited partner. Each partner's responsibility is limited to the amount of contribution.

Steps for setting up a business in Romania

The steps for opening a business in Romania are pretty common, like in other European countries, and we detailed them in this article. 

Verify and then book the name of the company

The first thing to do is to choose a name for your business and then check its availability on the National Trade Register. Once the name is available, it is time to produce three original company logos, proof of fees payment, around 16 euros, at the same authority. 

Open a Romanian bank account

The second step to make is to open a bank account. For this step, you will need to have these documents: a company name availability certificate, statutory provisions, proof of address for the company's head office, and a proxy letter of the bank account if you ask a third person to open it in your name.

 Good to know:

The minimum bank deposit varies from bank to bank. Once making the deposit, you will receive a receipt which indicates the amount you have deposited. 

Register the company to the National Trade Register 

Once you have reached this point, you need to register the company with the National Trade Register within 15 days. You need to follow the establishment of statutory provisions, which state the amount of capital contributed by each partner. 

You need the following papers to present:

  • the company's incorporation documents
  • the company's tax registration number issued by the Ministry of Public Finance
  • a legal notice published in the Romanian Official Gazette.

Note that fees of 600 lei (approx. 130 euros) apply. Procedures should be completed within three days.

Register the company with the Ministry of Public Finance

You need to register the company with the Ministry of Public Finance. This applies to all moral and physical persons residing or operating any commercial activity in Romania. Hence, you can download the VAT registration forms TVA 098 and registration form 010 to be produced to tax authorities. Note that this step has to be accomplished within 30 days following registration with the National Trade Register. In general, procedures should be completed within three days, but, in certain cases, they can take longer.

Set up an electronic staff register

This document then has to be transferred to an office of the Labour Inspectorate nearest to your company's head office. This procedure can also be carried out online after you have called personally at the Labour Inspectorate's office to create a virtual account and obtain a password.

Adapt the activity to the working conditions in Romania

The labour laws in Romania states a legal working week, which consists of 8 hours per day over 5 days. You will need to pay the employees for 20/21 days of local leave per year. All the working conditions need to be clearly explained and indicated in the employment contract. Mention if you have part-time contracts or a teleworking basis. 

Make sure you are paying the social contributions

In 2019, the Romanian government has established the social security contributions to the employee at a total of 45 per cent from their gross salary. 

 Useful links: 

National Trade Register
National Trade Register - Request form for the verification of the company name availability
National Agency for Tax Administration
PKF - Doing business in Romania

We do our best to provide accurate and up to date information. However, if you have noticed any inaccuracies in this article, please let us know in the comments section below.

About

Anne-Lise studied Psychology for 4 years in the UK before finding her way back to Mauritius and being a journalist for 3 years and heading Expat.com's editorial department for 5. She loves politics, books, tea, running, swimming, hiking...

List of Romania's guide articles

Comments

  • andreea.baceanu
    andreea.baceanu4 years ago(Modified)
    Starting a business in Romania is an adventure even for Romanian citizens, let alone for an expat :D I would definitely recommend that anyone who is looking to get into business here to get in touch with a local team of professionals (at least a lawyer and an accountant), the paperwork can be quite scary :) Another way of getting into the market with a little less effort is buying a turnkey business (yup, we have some of those, too). Best of luck to everyone out there!

See also

  • Working in Timisoara
    Working in Timisoara

    Timisoara has always been a pro-western Europe city and a trendsetter for the rest of Romania's counties. With a ...

  • Working in Bucharest
    Working in Bucharest

    As the Romanian capital, Bucharest is also the most important financial centre here, and also the most dynamic and ...

  • Working in Galati
    Working in Galati

    Galati is one of the biggest cities in Romania and also an interesting and challenging option for those ones ...

  • Working in Cluj Napoca
    Working in Cluj Napoca

    If you are looking to move to Cluj, the Romanian city might be a perfect choice. With the best quality of life in ...

  • Working in Constanta
    Working in Constanta

    Constanta, the third-largest economy in the country that is located in the Eastern part, is one of the few regions ...

  • Working in Iasi
    Working in Iasi

    Iasi is the most important political, economic and cultural centre in Moldavia, one of the provinces of Romania. ...

  • Accommodation in Timisoara
    Accommodation in Timisoara

    Also named the City of Roses, Timisoara is an urban adventure, a popular destination for both people living in ...

  • Driving in Romania
    Driving in Romania

    Whether you are coming for a short stay or moving to Romania for a period of time, it is a pity not to ...

All of Romania's guide articles