√ Simplified procedure for transfers of shares to non-shareholders in SRLs
√ Minimum share capital thresholds no longer applicable to SRLs
√ Simplified incorporation formalities for SRLs
On 30 October 2020, law No. 223/2020 for the simplification and debureaucratization of the transfer of shares and the payment of share capital (the Amending Law), amending the companies law No. 31/1990 (the Companies Law), was promulgated by the President of Romania. The Amending Law shall enter into force in the following days, after its publication in the Official Gazette.
The new amendments detailed below are meant to remove and/or simplify certain requirements applicable to the Romanian limited liability companies (SRLs).
- Simplified procedure for transfers of shares to non-shareholders in SRLs
A. Repeal of the 30-day standstill period
The Amending Law repeals the provisions regarding the observance of a 30-day opposition period, regulated by the Article 202 of the Companies Law, applicable to transfers of shares towards non-shareholders in SRLs, which was a highly rigid requirement in the procedure.
As such, transfers of shares in SRLs will be completed only on the grounds of the transfer documentation and registration with the Commercial Registry should now become a smoother process, with the consequence of transforming SRLs in a more appealing tool (especially exit-wise) in what concerns joint-venture type partnerships.
B. Customized majority requirements
The Amending Law provides that unless otherwise regulated by the articles of association, transfers of shares towards non-shareholders shall be approved with a majority of at least 75% of the share capital.
This new form of the Companies Law grants shareholders of limited liability companies (SRLs) full discretion in establishing if and what majority requirements are applicable for transfers of shares to non-shareholders.
- Minimum share capital thresholds repealed in respect of SRLs. Simplified incorporation formalities for SRLs
The Amending Law repeals the minimum share capital requirements applicable to SRLs and also contains provisions aimed at simplifying the process of setting up and registering an SRL with the Commercial Registry, as follows:
- Minimum share capital requirements are no longer applicable (the RON 200 threshold was repealed);
- Minimum nominal value of shares is no longer required (the RON 10 threshold was repealed); and
- Proof of payment of the initial contributions to the share capital is no longer required to be included within the set up documentation to be submitted with the Commercial Registry. However, the requirement to fully pay the initial contributions simultaneously with subscription of shares is still in force.
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