The establishment, organization and functioning of a company in Romania is mainly governed by the provisions of company Law no. 31/1990, as republished and subsequently amended, and Emergency Ordinance no. 76/2001 regarding the simplification of certain administrative formalities for the registration and authorization of business operations, whereby a unified procedure for registration and authorizing of businesses was established.

Companies may operate in Romania in one of the following structures:

Joint stock companies and limited liability companies represent the highest percentage of the total number of companies currently operating in Romania.

In a limited liability company with a sole associate, the law prevents that person from participating as an associate in another limited liability company and the same may not establish another limited liability company with a sole associate.

In the limited liability companies the associates are liable for the company's obligations only up to the value of the subscribed share capital.

The minimum share capital required under the law is ROL 2 million (approximately USD 63 at an exchange rate of USD 1 / ROL 33,000) and is divided into equal social parts, the nominal value of which may not be smaller than ROL 100,000.

Social parts do not represent negotiable titles and therefore may not be transacted on organized markets. The transfer of the social parts to persons outside the company may solely be made with the approval of the associates representing at least three quarters of the share capital.

The share capital of a joint stock company is a minimum of ROL 25 million (approximately USD 780 at an exchange rate of USD 1 / ROL 33,000) and is divided into shares with a nominal value that may not be smaller than ROL 1,000. The shares may be nominative shares or bearer shares and they may be issued in material paper form or in dematerialized form, by registration into the account.

The shares in the joint stock companies may be freely transferred and they may, in certain circumstances, be transacted on organized markets.

Upon the incorporation of a joint stock company, the share capital paid in by each shareholder may not be less than 30 percent of the subscribed share capital. The remaining 70 percent of the share capital must be paid in within 12 months following the incorporation. Up to the full payment of the shares, the company may not decrease its share capital and it may not issue new shares.

Joint stock companies may issue bearer or nominative bonds for an amount representing a maximum of three quarters of the paid-in and existing share capital, as per the latest approved balance sheet.

The nominal value of a bond may not be smaller than ROL 25,000.

The bonds issued at the same time must be of equal value if they give equal rights to their holders.

The joint stock company may be administered by one or several administrators, who may be either individuals or legal entities. When there are several administrators, they form the company's board of administration. The mandate granted to the administrators under the constitutive act or by a resolution of the general meeting is temporary and revocable and it may not exceed four years.

Unless the constitutive act provides for a higher number, the joint stock company must have three censors and as many deputies, either individuals or legal entities. At least one of the censors must be a certified accountant under the law or an accounting expert. The majority of the censors or the deputies must be Romanian citizens.

Subsidiaries are companies with a legal identity and are established in one of the company structures set forth above and under the conditions provided for each respective structure. Consequently, subsidiaries are independent entities with a separate legal identity within the company structure under which they are established.

Branches are entities without a legal identity, established by Romanian or foreign companies and incorporated with the trade registry located in the county/municipality where they are to carry out their activity. The legal regime of the branches applies to any secondary headquarters established by a company (work-point, agency, etc.)

Representative offices are entities without a legal identity, established by foreign companies under the conditions set forth by Law-Decree no. 122/1990 regarding the authorization in Romania of foreign companies' representative offices and economic organizations, with its subsequent amendments.

Representative offices are established on the basis of an authorization issued by the Ministry of Foreign Affairs. After the authorization is issued, the representative office is registered with the trade registry and the General Department for Public Finances and State Financial Control.

Representative offices can only perform activities on behalf of the foreign company that are in compliance with the functioning authorization issued by the Ministry of Foreign Affairs.

Representative offices cannot engage in direct commercial activity in Romania.

Partnerships are regulated by the provisions of the Romanian Commercial Code and may be established by Romanian or foreign individuals or legal entities. The establishment of a partnership does not result in a distinct entity legal identity and is not subject to authorization. The rights and obligations of the parties in a partnership, as well as the manner of functioning thereof, are set out in the partnership contract.