Investors have the possibility to open a holding in Romania. While the Romanian legislation does not specifically regulate the holding as a different type of legal entity than the ones regulated under the local law (such as the partnership, the limited liability company, etc.), investors can set up this type of structure.
The option to set up a holding in Romania is given by the fact that the term simply refers to a legal entity that holds shares in other companies (partially or wholly), which is a right granted to Romanian and foreign investors under the Romanian commercial law. Our lawyers in Romania can further advise on any matter referring to a local holding.
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What are the characteristics of a holding in Romania?
The main trait of a holding is that is holds shares in other companies, which indicates that the holding is a shareholder in the said businesses. The shares held by the holding in Romania guarantees that the holding has voting rights in the respective companies.
This implies that a holding has the right to decide over the control and the management of the companies whose shares are held by this entity. Typically, the holding acts as a parent company for at least another company (a subsidiary) or more.
While the holding in Romania can decide on the other company’s management and investment policies, it can’t intervene in its commercial activities; our Romanian lawyers can present other basic characteristics of this type of corporate structure. We can also help you if want to open a company in Bulgaria, where this procedure takes approximately the same (a few days), the minimum share capital is symbolic – 2 BGN and the minimum number of shareholders for an LLC is one (the same as in Romania).
Types of assets held
A holding in Romania can own a variety of assets. In the list below, our law firm in Romania presents some of the of the main assets typically held by holdings:
- shares;
- real estate;
- intellectual property.
How to register a holding in Romania
The Romanian holding is organized as one of the legal entities prescribed by the national law. This is why the process of company formation in Romania follows the standard registration steps, which are initiated at the Romanian Commercial Registry.
Investors must prepare the company’s statutory documents, proof of the registered address in Romania, details on the company’s minimum share capital, etc. You can rely on our attorneys in Romania during the registration of the legal entity – representation can be provided after signing the power of attorney. The time frame for incorporating a company in Romania is approx. 1 week, after you submit the reguired documents with the Trade Register. There is an app – La Registru – that can help you register your firm.
Why open a holding in Romania?
The holding in Romania is an advantageous way to organize and administer businesses – from a managerial point of view, but also when referring to the taxation policies available for this type of entity. A major benefit is that the holding is not required to pay the withholding tax on dividends in certain situations.
The tax exemption is granted when the company receives dividends from its affiliated businesses, but also when the company transfers shares. Investors who want to open a business in Romania should know that starting with 1st of January 2025, the corporate tax legislation has been modified, affecting companies which are not part of a group.
Some of the highlights of the new rules are presented below:
- the new tax rules were published in the Official Gazette no. 1334 of December 31, 2024, GEO no. 156/2024;
- under the new law, starting with 1st January 2025, companies must pay a dividend tax of 10% (increased from 8%)
- the 8% tax can still be charged for dividends distributed based on the interim financial statements referring to the financial year of 2024).
Companies that are organized as a holding are exempt from paying the dividend tax, which is why this is one of the reasons for which we recommend to open a holding in Romania. In fact, it must be noted that in the 1st quarter of 2025, the number of companies organized in holdings increased by 10%, given that there are several benefits that investors can obtain.
We invite you to contact our law firm in Romania for further information on other advantages of a holding. You can also rely on us if you want to buy a property in Romania for corporate or personal purposes.