[ESTABLISHING A BUSINESS ENTITY IN ROMANIA] 390
company shall not be dissolved if the number of shareholders is re-established up until the moment when the resolution of the competent courts becomes definitive. The minimum share capital for a joint-stock company is RON 90,000. In addition, every two years, the Government may modify this amount, taking into consideration the exchange rate, in order for the said amount to represent the equivalent in RON of EUR 25,000. Some of the contributions to the share capital of joint-stock companies must necessarily be made in cash, but the relevant legislation does not set forth a minimum. Contributions in kind may be made, but contributions to capital by way of provision of services are not accepted. Contributions by way of assignment of claims are admitted, except for joint-stock companies which proceed to public offerings. The law requires at least 30% of the share capital to be paid up upon incorporation, but a distinction is set as to the payment terms of the balance of share capital depending on the nature of share capital contributions, as follows: a) in the case of shares issued in exchange for contributions in cash, the balance of the share capital shall be paid within 12 months as of the company’s registration; b) in the case of shares issued in exchange for contributions in kind, the balance of the share capital shall be paid within a maximum of two years as of the company’s registration. The share capital is divided into shares having a par value of RON 0.1. Shares, which can be either registered or bearer shares, have an equal par value and confer equal rights on shareholders, except for non-voting preference shares. Preference
shares cannot represent more than one quarter of the share capital and shall have the same par value as ordinary shares. A joint-stock company can hold up to 10% of its subscribed share capital during a period of up to 18 months. Those shares however do not entitle it to participate in the distribution of dividends, and the voting rights thereto are suspended. The duration of the joint stock company may be
undetermined. 1.3. Branches
Branches lack a legal personality of their own, being economically and legally dependant on the parent company. They have their own registered seat and conduct business operations on behalf of the parent company, on the basis of a mandate granted by the latter, but they may also conclude transactions on their own behalf. Branches of foreign entities must be registered with the trade registry from Romania, where they will operate, upon the corporate decision of the mother company. No constitutive act is necessary, due to the lack of legal personality; however, the mother company must establish a head of the branch by its corporate decision. There are no requirements with regard to any “endowment capital” in the case of a branch; in addition, there is a restriction as to the business purpose of a branch set up in Romania, which must have the same business purpose as that of the foreign parent company, or a part of the activities thereof. The duration of a branch cannot exceed the duration of the mother company, as sustained by the relevant corporate documents of the latter.
ILN Corporate Group – Establishing a Business Entity Series
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