The branch is just an extension of the parent company and therefore has no legal personality and no independence. Law no. 105/1992 on the Regulation of the Private International Law Relationship adopts the accepted international practice by which a branch is governed by the national law of its parent company.
Legally, the branch has no separate status from the foreign company itself. It simply conducts business in Romania. The foreign company will be liable to the employees and creditors of the branch for the actions taken, the contracted debts by its managers and agents on behalf of the branch.
In order to set up Romanian branch you have to follow the same steps as those mentioned for the subsidiary but, there is no need to establish incorporation statutes. The documents required to incorporate branch Romania include:
• a certified copy of the articles of incorporation of the parent company;
• evidence of registration of the parent company in its country of origin;
• documentation indicating the company's solvency;
The next step to open company branch Romania is the registration with the local bureau of the National Trade Register Office.
When deciding to incorporate branch Romania you may also consider the main differences between a subsidiary and a branch:
• While a subsidiary has a legal personality and is considered a Romanian entity, the branch is just an extension of the parent company and therefore has no legal personality and no independence.
• The branch has no separate status from the foreign company itself but, a Romanian subsidiary of a foreign company is a Romanian legal person and, consequently, it is subject to Romanian laws.