Riding the 2025 Compliance Wave: Insights for Romanian Limited Liability Companies (“LLCs”)

On October 20, 2025, Romania’s Constitutional Court (“CCR”) ruled on the Law on the Establishment of Measures for the Recovery and Efficiency of Public Resources and for the Amendment and Completion of Certain Normative Acts (the “Law”), upholding it almost entirely. 

According to the CCR’s press release, the only provision found unconstitutional was the phrase concerning the “detection of deceptive behavior using polygraph techniques”, which the Court deemed insufficiently clear and predictable. However, this does not affect the new fiscal and corporate governance measures that shall apply  for LLCs.

Since the law was challenged before promulgation, it has not yet entered into force. Following the publication of the CCR’s decision in the Official Gazette and subsequent presidential promulgation, the law will take effect in its validated form.

Romanian businesses have already been complying with the requirements introduced by Law No. 141 of 25 July 2025, which amended the Fiscal Code by increasing the standard VAT rate to 21% and the dividend tax rate to 16%.

Now, they will soon have to face a new set of regulatory and fiscal adjustments under the upcoming Law, including minimum share capital requirements for LLCs, formalities governing the transfer of shares, and rules addressing corporate tax inactivity.

1. Brief Summary of the Main Changes:

• Minimum Share Capital Requirements

As the 1-leu minimum capital rule, originally introduced to encourage entrepreneurship, has in practice facilitated the creation of “phantom companies”, the new piece of legislation replaces the symbolic 1 RON threshold with more robust capital requirements for LLCs.

Therefore, under the new law:

• New LLCs must have a minimum capital of RON 500 (including the startups);

• Existing LLCs with a net turnover above RON 400,000 in the previous financial year must raise their capital to at least RON 5,000.

• Companies already above this threshold when the law takes effect have 2 (two) years to comply.

Failure to meet the requirement may lead to dissolution, either at the request of an interested party or by the National Trade Register Office (”ONRC”). This process can be stopped if the company increases its capital before the decision becomes final.

While this new rule may reduce the “phantom companies” phenomenon, it also raises barriers for small entrepreneurs who until now benefited from a very low-cost entry point.

• New Rules regarding Share Transfers 

The law introduces stricter requirements for transferring ownership within the LLCs whenever such a transfer results in a change of control, as defined by the Fiscal Procedure Code.

Under the new rules, companies must comply with notification and fiscal obligations involving the National Agency for Fiscal Administration (“ANAF”). Specifically, the transfer must be reported to ANAF within 15 (fifteen) days from the date of the transaction by the transferor, the transferee, or the company itself, accompanied by the share purchase agreement and the updated articles of association.

If the company has outstanding tax liabilities or other enforceable debts, the transferee or the company must provide guarantees in favor of ANAF equal to the amount stated in the tax clearance certificate. The Trade Register will not record the transfer until ANAF confirms that these guarantees are in place.

Should the tax obligations remain unpaid within 60 days from registration, the guarantees may be enforced.

While these provisions do not prevent the parties from signing the transfer agreement, they do delay formal registration with the Trade Register - and therefore the transfer will not be enforceable against third parties until the company’s fiscal obligations and guarantees are resolved.

• New Inactivity Triggers 

The law also revises the rules governing tax inactivity, introducing two additional scenarios, (beyond those already set out in the Fiscal Procedure Code) leading to fiscal inactivity, as follows:

• no bank account in Romania; or 

• failure to submit annual financial statements - if not submitted within 5 months after the legal deadline, the legal entity may be declared inactive.

Companies inactive for more than one year (or more than three years for voluntary suspension) will face insolvency, liquidation or dissolution procedures initiated by ANAF. 

If inactive beyond the maximum period without reactivation, ANAF may request insolvency, liquidation, or deregistration as appropriate.

• Dividends & Loan Restrictions

• Restrictions on shareholder loans: Companies distributing quarterly dividends will be prohibited from granting advances or loans to shareholders, associates, or affiliated persons (as defined by the Fiscal Code) until all interim dividend differences are settled.

• Companies whose net assets fall below half of their subscribed share capital, based on approved annual financial statements, cannot repay loans to shareholders, associates, or other affiliated parties (as defined under applicable accounting rules) until their net assets are restored.

• Joint liability: Both the administrator and any shareholder/associate may be held jointly liable if a company pays interim dividends without proper adjustment or repays loans while its net assets are below the legal minimum.

• Administrative penalties: Companies violating these rules may face fines of at least RON 10,000, up to RON 200,000.

• Dividend distribution conditions: Payment of dividends will be conditioned on the prior creation of legal reserves, coverage of accumulated accounting losses, and compliance with statutory reserve requirements.
  

In addition, companies whose net assets fall below half of their subscribed share capital will be allowed to distribute dividends from current-year profits only after restoring their net asset value to at least the legal minimum.

The draft also provides for the conversion of shareholder or associate loans into shares or equity interests in cases where the company’s net assets remain below half of the subscribed capital and are not reconstituted within the legal timeframe.

2. Next Steps

To stay ahead and fully compliant, companies should take a careful look at their share capital, governance, and shareholding structures, ensure taxes and financial statements are up to date, and align dividend and shareholder loan policies with the new rules. 

In addition to the new rules, it should not be forgotten that all LLCs will also need to update their NACE codes by September 2026. 

The content of this article was developed by Andreea Ceausan, Corporate Counsel at Legally Remote, and has a strictly informative and general purpose; the information contained does not constitute legal advice.

If you need legal assistance for your business, schedule a consultation call. Together with my team, I help you get rid of document stress so you can focus on the essentials of your business.

***