Corporate & Commercial, Schoenherr updates

Romania

Contributed by Schoenherr
Streamlining procedure for declaring beneficial owners
  • Romania
  • 29 June 2020

Pursuant to a recently issued draft bill, the legal framework regarding companies' obligation to submit a statement about their beneficial owners could be simplified. The main amendments, which are expected to be well received, will remove companies' obligation to submit an annual statement regarding their beneficial owners and declare their beneficial owners (in the case of companies held by individuals).

Parliament eases procedure for setting up new companies
  • Romania
  • 13 January 2020

A series of minor yet impactful amendments will shortly be introduced to the Companies Law, making it easier for investors and entrepreneurs to set up a new company. Parliament adopted the amendments in order to reduce the red tape surrounding company incorporation and encourage investment in the Romanian economy.

Directors' confidentiality obligations
  • Romania
  • 07 October 2019

Under Romanian law, the scope and duration of a director's confidentiality obligations must be agreed in the mandate agreement to be concluded between the director and their company. In order to mitigate any risks in this regard, mandate agreements should set out the specific circumstances in which directors can disclose confidential information to their company's parent undertaking or subsidiaries.

All board decisions made by delegation of powers can be challenged in court
  • Romania
  • 15 October 2018

Although the Companies Law created flexible mechanisms and procedures allowing specific shareholder powers to be delegated to a company's management, it also provides that only some decisions made in this regard can be subject to an annulment action. Specifically, the law excludes decisions which concern an increase in a company's share capital from being challenged. However, the Constitutional Court recently recognised shareholders' right to request the annulment of such decisions in court.

Companies can now distribute dividends on a quarterly basis – but will they?
  • Romania
  • 20 August 2018

Until recently, Romanian companies could distribute dividends to shareholders only on an annual basis and on approval of their annual financial statements at the end of each financial year. This paradigm has changed and companies can now opt to distribute their dividends annually or quarterly. Although these newly acquired corporate rights have been widely welcomed within the Romanian business markets, they may initially be treated with suspicion by entrepreneurs.


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