Establishing a company in Romania is an attractive opportunity for foreign investors seeking to access the European Union market. As an EU member since 2007, Romania offers a dynamic business environment, low corporate tax rates, and a variety of legal forms suited for different business needs. This guide provides a comprehensive overview of entity types, capital requirements, shareholder liability, and the tax system in Romania to support those interested in establishing a company in Romania.
Country Overview: Romania
- Official Name: Romania (România)
- Capital: Bucharest
- Population: Approximately 19.5 million (as of 2024)
- Official Language: Romanian
- Religion: Christianity (predominantly Eastern Orthodox)
- Climate: Temperate-continental climate; cold winters and warm summers
- Time Zone: UTC+02:00 (UTC+03:00 during daylight saving time)
- Phone Code: +40
- Currency: Romanian Leu (RON)
Legal Entity Types in Romania
Foreign investors have several options when it comes to establishing a company in Romania, depending on their business size, investment strategy, and liability preferences. Romanian law also allows the formation of branches, representative offices, and permanent establishments.
| Company Type | Key Features |
|---|---|
| General Partnership (SNC) | Requires at least 2 partners. No minimum capital. Partners have unlimited joint liability. Capital amount is freely agreed upon. Ideal for close collaborations based on mutual trust. |
| Limited Partnership (SCS) | Consists of active and silent partners. Silent partners are liable only up to their contribution. No capital requirement. Flexible in defining partner roles. Suitable for small or niche businesses. |
| Joint-Stock Company (S.A.) | Requires at least 2 shareholders. Minimum capital of 90,000 RON (~€25,000). Liability limited to capital contribution. Can be private or public. Best suited for large-scale investments and public listings. |
| Partnership Limited by Shares (SCA) | Hybrid of joint-stock and partnership structures. Requires 90,000 RON capital. Active partners manage the company and have unlimited liability; silent shareholders have limited liability. Ideal for mixed ownership and governance. |
| Limited Liability Company (S.R.L.) | Most common type in Romania. Requires minimum capital of 200 RON (~€40). Up to 50 partners. Liability is limited to capital invested. Can be fully foreign-owned. Ideal for SMEs and foreign investors. |
Taxation in Romania
| Tax Type | Rate / Threshold | Details |
|---|---|---|
| Corporate Income Tax | 16% | One of the lowest corporate tax rates in the European Union. |
| VAT Registration | Required if turnover > 220,000 RON (~€50,000) | Mandatory for companies exceeding this annual revenue threshold. |
| Value-Added Tax (VAT) | Standard rate: 19% | Applies to most goods and services. |
| Reduced rate: 9% | Applies to food, medicines, drinking water, hotel accommodation, books, newspapers. | |
| Super-reduced rate: 5% | Applies to social housing, certain books, and cultural/event tickets. |
Conclusion
Whether you plan to open a small LLC or a large-scale joint-stock company, establishing a company in Romania provides foreign investors with flexibility, low operational costs, and access to the EU market. The country’s tax advantages and legal framework make it one of the most investor-friendly destinations in the region.
If you’re considering establishing a company in Romania, understanding the structures and tax rules is essential. For further guidance or help with the process, we recommend consulting with a local advisor or company formation specialist.For more information, please feel free to contact us.
