To establish subsidiaries or secondary offices in Romania, companies must comply with the provisions of the Law on commercial companies.
Types of secondary offices
If you wish to expand your activities in Romania, you may choose between a subsidiary and different types of secondary offices, of which the best-known are:
- representative offices
- work points
Any subsidiary that you set up in a Member State of the EU must be registered with the Trade Register in the respective country.
Without legal personality
Branches are secondary offices of a company, without legal personality. By law, they must be registered in the Trade Register before beginning their activity.
Representative offices are set up and operate in accordance with the provisions of the Decree-Law on the authorisation and operation in Romania of representative offices of foreign companies and economic organisations.
With legal personality
Subsidiaries are companies that hold legal personality, but are controlled by the parent company. They are set up and carry out their activities in accordance with the provisions of the Law on commercial companies.
The Romanian government applies EU legislation dealing with common tax schemes to the Romanian subsidiaries of European companies. The standards for applying these directives in Romania are stipulated in the Fiscal Code.
Many of the requirements and procedures for opening a secondary establishment are the same as for starting up a business.
The Services Directive: Points of single contact
The Services Directive is a European law that aims to make life easier for businesses that wish to provide services in the European Union - in their home country or abroad. The Directive defines the rules that apply to entrepreneurs wishing to establish a business or perform temporary services in the EU/EEA area (the 27 EU member states, plus Iceland, Liechtenstein and Norway). It obliges member states to eliminate unnecessary bureaucracy, simplify formalities for businesses and make public administrations more efficient.
For the implementation of the Directive, each member state had to set up ‘Points of Single Contact (PSC)’ , e-government portals which help businesses complete their administrative procedures on-line. The PSCs provide comprehensive information on all administrative matters related to setting up or expanding a services business in a given country. This includes for example:
- Which licences, notifications or permits do I need to obtain to start a business (at home or abroad)?
- What do I need to do when I want to offer my services abroad on a temporary basis?
- What do I need to do to apply for a licence? Which authority is responsible?
- Are the licences subject to a fee? What kinds of deadlines apply?
- Which acts and decrees apply in my sector?
- What do I need to do to establish, for instance, a restaurant or a shop? Or to work as a tour operator in another country without actually setting up a company?
- Where can I turn for personalised advice and further information?
With the PSCs, you no longer need to approach various authorities one by one!! The PSC allows you to find all relevant information and to send in your online applications to the responsible authority through one single contact point, the PSC. You can complete your administrative formalities electronically through the PSC. Just contact the PSC of the country that you want to do business in.
All PSCs are part of the European EUGO network; through a central website you can easily access all PSCs in Europe. Of course, the services of the PSCs are optional. You may always address yourself directly to the relevant authorities, too.
The following documents are required to obtain authorisation to operate a representative office of a foreign company in Romania:
- a certificate issued by the Chamber of Commerce and Industry in the country where the company's headquarters are located. This confirms the legal existence of the foreign company, as well as the nature of its business and its share capital;
- a certificate of creditworthiness issued by the bank through which the company carries out its financial operations;
- the articles of association, which certify the organisational form and manner of operation of the foreign company;
- a power of attorney issued to the head of the representative office by the foreign company.
These documents must be submitted to the headquarters of the Ministry of the Economy, Commerce and the Business Environment.
Most of the requirements and procedures for establishing a subsidiary or secondary office are the same as those for starting up a company.
Usual payment obligations
A tax registration declaration / declaration of remarks regarding secondary offices must be completed when registering secondary establishments that have payment obligations.
A declaration regarding secondary offices must be completed for secondary offices that do not have any payment obligations.
Details on how to complete and submit these declarations are available on the website of the Agenția Națională de Administrare Fiscală, ANAF (National Agency for Fiscal Administration).
Foreign companies that have representative offices operating in Romania must pay an annual tax in accordance with the provisions of the Fiscal Code in force.