[ESTABLISHING A BUSINESS ENTITY IN ROMANIA] 391
1.4. Representative offices Representative offices lack legal personality and act on behalf of the parent company, lacking a patrimony of their own. Their registration is subject to authorization by the Ministry for Entrepreneurship and Tourism, for the time being, upon the corporate decision of the mother company, and the establishing of a head of the representative office, on the basis of a power-of-attorney. Representative offices may be set-up and perform their activity in Romania subject to a yearly functioning tax of EUR 1,000. The duration of the representative office in Romania can by no means exceed the duration of the foreign mother company and it is granted in accordance with the taxes that are paid proportionally with the envisaged duration. The only activities that a representative office may carry out are covered by the business purpose of the mother company, specifically: issuing/receiving offers and orders, negotiating, but not concluding contracts on behalf of the mother company (without a special mandate from the latter), undertaking marketing and advertising activities, carrying out any other ancillary or preparatory activities, promoting and/or supporting the business of the mother company. 2. Steps and Timing to Establish 2.1. Incorporation of entities with a Romanian legal personality Irrespective of the corporate form chosen (limited liability company or joint stock company), the following formalities need to be complied with in order to set up a company: - reserving the corporate name at the Trade Registry (which is granted instantly, either online or in hard copy);
drafting the constitutive act;
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signature of the constitutive act;
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registration with the Trade Registry;
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incorporation;
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- issuing of an incorporation certificate which shall mention the assigned Trade Registry number and the sole registration code. The incorporation and the granting of the certificate regarding the authorization of the activities declared by the company shall be effective within three days from the date the application was filed with the Trade Registry, if the complete required documentation is submitted. The company is a legal entity from the date of its incorporation in the Trade Registry. Joint-stock companies can be set up as closely held companies or by way of public offering. Specific formalities are required to set up joint- stock companies by way of public offering. The subscription of shares shall be made in one or several copies of the issue prospectus. The company can be set up only if the full share capital was subscribed and each subscriber has paid in cash half of the subscribed shares value. The other half shall be paid within 12 months from the incorporation date. The constitutive meeting will have to verify the existence of the payments, to approve the constitutive act and to appoint the members of the Board of Directors or of the Supervisory Board, as well as the auditors. Subject to the provisions regarding the issue prospectus formalities, the development of the constitutive act of a joint-stock company set up by way of public offering is no different from the one of a closely held joint-stock company, described above.
ILN Corporate Group – Establishing a Business Entity Series
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