Starting a business in Romania: a hub for your Eastern European operations

The AB is one of the most commonly used structures for foreign businesses establishing operations in Sweden. It functions as a separate legal entity, with shareholder liability generally limited to the value of the subscribed share capital. An AB requires a minimum share capital of SEK 25,000. While it allows for 100% foreign ownership, the company must appoint a board of directors, and at least half of those members are generally required to reside within the European Economic Area (EEA), though residency waivers may be available in certain cases.

In Romania, the SRL is the most common legal entity used by small and medium-sized enterprises and foreign subsidiaries. It can be formed with one or more shareholders, including individuals and companies, with shareholder liability limited to the subscribed share capital. An SRL has separate legal personality and may be incorporated with a minimum share capital of RON 1. Profits are generally subject to corporate income tax, and registration with the NTRO is mandatory.

The SA is typically used by larger businesses or those seeking to raise capital or list shares. Minimum share capital is RON 90,000 (around €17,500), with shareholder liability limited to the shares held. Compared to other Romanian entity types, SAs are generally subject to more complex regulations and reporting requirements, alongside standard corporate income tax obligations.

A branch office allows a foreign company to operate in Romania without incorporating a separate legal entity. It is treated as an extension of the parent company, which remains fully liable for the branch’s obligations, and must be registered with the NTRO. A branch office is often used for project-based or initial market entry operations. While there is generally no minimum capital requirement, the branch is subject to Romanian corporate tax on profits attributable to its Romanian operations.

A representative office may be established for non-commercial purposes. Its activities are generally limited to market research, promotional activities and coordination with customers or business partners. It cannot conduct commercial transactions or generate revenue in Romania. As a result, representatives are typically used by foreign companies assessing the Romania market before committing to full incorporation.

While less commonly used by foreign investors, Romania also recognises general partnerships and limited partnerships. These structures are typically used for professional services or joint ventures and involve varying degrees of partner liability. General partnerships require registration with the NTRO. Regulatory approval and sector-specific rules may apply, particularly where professional licensing is required.

A 'free zone company' in Romania is not a separate legal entity type, but rather a standard Romanian company – most commonly an SRL – authorised to operate within a designated free zone or special economic area. Depending on the nature of the activities carried out, companies in these zones may benefit from customs duty exemptions, as well as infrastructure and sector-focused support.

Setting up a business in Romania involves a range of costs, which vary depending on several key factors. These include the entity chosen (such as an SRL, SA, branch or representative office), the specific business activity and the city or region in which operations will be established – for example Bucharest, Cluj-Napoca or one of Romania’s free trade zones.

• Registration and licensing fees: Costs associated with company incorporation in Romania. This includes registering the company with the NTRO, securing the company registration certificate and unique registration code, as well as applying for any required licences with the relevant authorities.

• Notary and legal fees: While establishing an SRL does not always require a notarial deed, certain documents (such as specimen signatures, declarations or real estate contributions in kind) may still require notarisation. SAs and more complex structures will typically involve additional legal documentation and advisory costs.

• Capitalisation costs: An SRL can be incorporated with a minimum share capital of RON 1. An SA, however, requires a minimum share capital of RON 90,000, of which at least 30% is typically paid up at incorporation.

• Tax registration: Businesses must register for corporate income tax or the micro-enterprise regime (if eligible) and, where applicable, VAT with the National Agency for Fiscal Administration.

• Visas and work permits: Expenses related to obtaining work authorisations and long-stay visas (D/AM-type visa) for non-EU and non-European Economic Area (EEA) nationals. Applications are processed through the General Inspectorate for Immigration.

• Office space rental: Costs for leasing office space vary significantly depending on location and building grade. Bucharest generally has the highest commercial rents, followed by major regional hubs such as Cluj-Napoca and Timișoara. Virtual office solutions may be available, subject to substance and regulatory requirements.

• Professional fees: Costs for engaging professional advisers, including legal counsel, incorporation specialists, payroll providers, tax advisers and accountants. Ongoing accounting is mandatory for Romanian companies.

• Other potential costs: These may include translation and apostille/legalisation costs for foreign corporate documents, bank charges, business licences, sector-specific permits and local taxes, such as building or land tax where applicable.

Establishing operations in a new market can involve multiple administrative and regulatory steps. If you're planning to expand into Romania, we can provide expert support throughout the process to help manage these requirements more efficiently.

We typically begin with a detailed consultation to understand your business objectives, operational requirements and long-term goals. This enables us to determine the most suitable legal structure (such as an SRL, SA, branch office or representative office) while also considering location preferences and any applicable state aid schemes or regional incentives.

We can also assess potential eligibility for investment incentives available through Invest Romania.

Based on the consultation, we can prepare a strategic setup plan outlining the proposed approach for establishing your business in Romania. This can include guidance on company incorporation, governance arrangements and director responsibilities, shareholding matters (including foreign ownership aspects), as well as any regulatory or licensing requirements relevant to your industry.

We can then prepare the required documentation, helping to ensure accuracy and compliance with Romanian regulations. This may include drafting legal documents, completing application forms and coordinating the necessary filings and approvals from the NTRO.

Following incorporation, we can assist with registration with the National Agency for Fiscal Administration (ANAF) for corporate tax and VAT (if applicable), employer registration and employee reporting obligations, together with any sector-specific licences or regulatory approvals where required.

Non-EU/EEA directors or employees relocating to Romania may require work permits and long-stay visas. Where relevant, we can assist with these applications and liaise with the Romanian General Inspectorate for Immigration and consular authorities.

Banking timelines may vary depending on the shareholder structure and source-of-funds verification requirements. Having assisted businesses across multiple jurisdictions, we are familiar with the practical expectations and onboarding procedures commonly adopted by leading banks. We can support the opening of a corporate bank account in Romania, providing guidance on documentation requirements, substance expectations and compliance checks.

Beyond the incorporation phase, we can continue to assist with office setup, payroll registration, employment contracts and operational logistics. This can help reduce administrative burdens as operations begin. Our support can also extend to fulfilling ongoing accounting and tax compliance requirements. This may include VAT registration and filing, corporate income tax obligations, statutory financial statement preparation and bookkeeping in accordance with the Romanian Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS), where required.

The overall timeline for setting up a business in Romania can vary depending on several factors. To facilitate an efficient market entry, we can coordinate the various incorporation and administrative procedures while providing clear visibility on the expected stages.

• Chosen legal structure: Incorporation of an SRL can often be completed within three to seven business days once all required documentation has been prepared. Registration of an SA or branch office may take longer due to additional documentation and capital requirements.

• Complexity of business activity: Regulated sectors (such as financial services, energy, pharmaceuticals or transport) may require additional licences or regulatory approvals, which can extend the overall setup timeline.

• Free trade zone requirements: Certain permits and incentives are administered at free trade zone level. Processing times may therefore differ slightly.

• Efficiency of document processing: The time required for the relevant authorities to review and approve submitted documentation can also affect timelines. Timely submission of complete and accurate documentation may help avoid delays.

• VAT registration review: VAT registration applications are subject to review by the ANAF, which may request additional documentation and potentially extend the timeline.

• Bank compliance procedures: Corporate bank account opening may be subject to enhanced due diligence checks, particularly for foreign shareholders or more complex group structures.

• Work permit processing: Applications handled by the General Inspectorate for Immigration may take several weeks, depending on nationality and the completeness of the documentation submitted.

Our experience and proactive approach can help streamline the business setup process in Romania. We provide clear guidance on the required steps and potential bottlenecks, helping to ensure that all documentation is prepared accurately and submitted correctly to minimise delays.

• Initial planning and documentation preparation: Typically 1 to 2 weeks

• Romania company registration: Often completed within 1 week following submission of all necessary documentation to the trade register.

• VAT registration: Usually 1 to 3 weeks, depending on review by the ANAF.

• Visa and work permit processing: Commonly 4 to 8 weeks, depending on nationality and case complexity.

• Bank account opening: Typically 2 to 6 weeks, depending on compliance checks and the banking partner involved.

For a more accurate assessment based on your plans, please get in touch with our team.