Latest news in the corporate field – Simplifying and de-bureaucratization of the share transfer procedure and the payment of the share capital in case of limited liability companies
02.11.2020 – Law no. 223/2020 for simplifying and de-bureaucratization of the share transfer procedure and the payment of the share capital via the amendment of Companies’ Law no. 31/1990 (“Law 223/2020”) has been ratified by the Romanian President on 30th of October 2020 and follows to be shortly published within the Official Gazette of Romania in order to be enforced.
By entering into force of Law 223/2020, Romania aligns with the other European states and finally eliminates the excessive formalities in respect to the functioning of limited liability companies, among which the most expected one was the elimination of the mandatory opposition against the share transfer pertaining to third parties outside the shareholders of the company.
Imagined as a protective measure for the creditors of the company (especially for recovery of the fiscal receivables), the opposition against the share transfer proved, in practice, an excessive and bureaucratic measure, both for the limited liability companies which were obliged to follow a lengthy and expensive procedure and for the courts of law vested to decide upon such oppositions.
The amendments brought by the new enactment have the purpose to meet the necessities of a business environment more and more dynamic and focused on the effectiveness within closing transactions and investments (both national and multi-jurisdictional).
In a nutshell, Law 223/2020 brings the following novelties:
(a) Elimination of the minimum threshold of the share capital amount of RON 200 (approx. EUR 40) and of the requirement that the nominal value of a share be at least RON 10 (approx. EUR 2) at the moment of incorporation of limited liability companies. The new law limits to provide that in case of such type of companies, the share capital shall be divided into equal shares.
(b) Elimination of the obligation to perform a separate registration with the fiscal authorities of the document attesting the ownership right over the immovable designated as registered office, such registration following to be performed between the Trade Register Office and fiscal authorities.
(c) Instilling an exception for the limited liability company from the obligation to provide the evidence that the payment of the share capital was performed in accordance with the articles of incorporation.
(d) Amendment of the provisions regarding the possibility of the creditors of the company and any other damaged persons to submit an opposition against the decisions of the shareholders on the amendment of the articles of incorporation, as follows:
(i) The reference to the application of art. 57 of the Companies’ Law no. 31/1990 regarding the possibility of the court to declare the nullity of the challenged decision is eliminated.
(ii) The possibility to request the suspension of the challenged decision is eliminated.
(e) Simplifying the share transfer procedure to a third-party, i.e. other than the existing shareholders of the limited liability companies, as follows:
(i) The new enactment allows the shareholders of a limited liability company to establish via the articles of incorporation lower requirements of majority then the three quarters imposed under the law for the approval of the transfer of the shares to a third-party.
(ii) Repealing of all provisions regarding the mandatory procedure for share transfer, consisting into two steps: submission of the shareholders’ decision mention with the Trade Register and publishing thereof in the Official Gazette, the occurrence of the share transfer being effective either after lapsing of a 30-day opposition period since such publishing of the decision or, in case any opposition is filed, at the date when the
The Romanian version of this update is available here.