How to Do Business In Romania? – Super Business Manager

Doing business in Romania involves navigating the legal steps for company registration, understanding the tax and labor environment, and adhering to local business culture and etiquette.

Here is a comprehensive guide on how to approach doing business in Romania.

1. Company Registration and Legal Setup

The most common and popular legal structure for both local and foreign entrepreneurs is the Limited Liability Company (SRL – Societate cu Răspundere Limitată). There are generally no restrictions on foreign ownership.

Key Steps for Company Registration (SRL)

Choose and Reserve a Company Name: The name must be unique. You must check its availability and reserve it through the National Trade Register Office (Oficiul Național al Registrului Comerțului – ONRC).
Determine Business Structure and Prepare Documents:
- Minimum Share Capital: The minimum share capital for an SRL is very low, historically around RON 200 (approx. €40).
- Draft the Articles of Incorporation (Constitutive Act): This document is essential and must detail the shareholders, capital contributions, company activities (using NACE codes for classification), and management structure.
Secure a Registered Office: All companies must have an official registered address (sediu social) in Romania. This can be a leased property, an owned property, or a service from a law firm (virtual office).
Open a Bank Account and Deposit Capital: Deposit the minimum share capital into a dedicated company bank account. A deposit receipt will be required for registration.
Submit Documents to the Trade Register: Submit the complete file to the ONRC. The documents must be in Romanian or accompanied by certified translations. The typical processing time is a few business days once all documents are in order.
Tax and VAT Registration: After receiving the registration certificate, you must register for tax purposes with the National Agency for Fiscal Administration (Agenția Națională de Administrare Fiscală – ANAF).
- VAT Registration: This is mandatory if your annual turnover exceeds RON 300,000 (approx. €60,000).

Alternative Entry Methods

Joint Stock Company (SA): Suitable for larger businesses, requiring a much higher minimum share capital (approx. RON 90,000).
Branch or Subsidiary: A branch is an extension of the parent company with no minimum capital but subjects the parent company to full liability for the branch’s debts.
Employer of Record (EOR): Allows you to hire employees in Romania without establishing a local legal entity. The EOR handles all local payroll, tax, and compliance responsibilities.

2. Tax and Regulatory Environment

Romania offers a generally favorable tax environment.

Key Taxes

Corporate Income Tax: A flat rate of 16% on profits.
Micro-Enterprise Tax: Small companies with an annual turnover below a certain threshold may opt for a lower tax rate on their revenue instead of the 16% corporate income tax on profit.
VAT (Value Added Tax): The standard rate is 19%.
Dividend Tax: A tax is applied to profits distributed as dividends.

Labor and Employment Compliance

The Romanian Labor Code governs all employment relationships.

Employment Contracts: Must be drafted (at least in Romanian) and registered with the labor inspectorate at least one day prior to the employee starting work.
Working Hours: The standard working week is 40 hours over five days, with a maximum limit of 48 hours per week (including overtime).
Annual Leave: Employees are legally entitled to a minimum of 20 working days of paid annual vacation.
Social Security Contributions: As of 2018, the majority of social security contributions are paid by the employee, but the company is responsible for withholding and remitting them, in addition to an employer-paid Labor Insurance Contribution.

Licenses and Permits

General registration with the Trade Register is the first step, but many business activities require specific operational licenses or permits from local authorities (e.g., City Hall) or specialized national bodies (e.g., for banking, insurance, or pharmaceutical activities).

3. Business Etiquette and Culture

Romanian business culture emphasizes respect, professionalism, and relationship-building.

Aspect	Etiquette Guide
Greetings	Formal: Greet with a firm handshake and make direct eye contact. An older man may sometimes kiss a woman’s hand.
Titles & Names	Hierarchy is important. Use formal titles like Domnul (Mr.) or Doamna (Mrs.) with the last name until you are explicitly invited to use first names.
Communication	Communication is valued as clear, concise, and courteous. While Romanians are friendly, maintain a professional and polite tone. Patience is a virtue, as decision-making can be slow and often comes from senior management.
Meetings	Punctuality is highly regarded, so aim to arrive on time or slightly early. Exchange business cards at the beginning of the meeting. Meetings often start formally and may become more casual later.
Dress Code	Formal and conservative attire is recommended for business meetings. For men, a dark suit is standard. For women, a tailored suit or modest dress.
Relationship Building	Personal relationships are critical. Business deals are often built over social engagements like meals or coffee. Be genuine, and show interest in Romanian culture, history, or sports to build rapport.