Types of Companies in Romania in 2026: SRL, SA, PFA, Branch — Which One Should You Choose?
Romanian law offers four structures through which business may be carried on, and the choice between them determines liability, the rate at which profits are taxed, the capital that must be committed and the administrative burden the owner will carry for as long as the business exists. For a founder based outside Romania it is the first decision to be taken and the one most expensive to reverse.
This guide sets out each structure as it stands in 2026, following the amendments made by Law No. 239/2025, the revised microenterprise thresholds and the reinstated share capital requirements. It compares them on the criteria that determine the answer in practice, and it identifies the circumstances in which the obvious choice is not the right one.
The SRL
An SRL, societate cu răspundere limitată, is the Romanian limited liability company. It corresponds to the LLC in the United States, the GmbH in Germany and Austria, the BV in the Netherlands and the private limited company in the United Kingdom. More than nine in ten companies registered in Romania take this form.
An SRL may be established by a single shareholder or by as many as fifty. Since 1 January 2026 the minimum share capital is RON 500, approximately €100. Where net turnover exceeds RON 400,000 in a financial year, the capital must be increased to at least RON 5,000 by the end of the following year; the mechanics of that filing are set out in our note on the RON 5,000 share capital requirement. No shareholder or director need be resident in Romania, and a foreign national may serve as sole administrator without restriction.
The fiscal treatment is what draws most foreign founders to the form. A company with annual revenue below €100,000 which employs at least one person full time is taxed at 1% of revenue rather than on profit, which is among the lowest effective rates in the Union. Above that threshold, or where the conditions are not met, the standard rate of 16% applies to profit. Dividends are subject to withholding at 16%, increased from 10% with effect from 1 January 2026, and health insurance contributions apply to dividend income above thresholds expressed as multiples of the minimum gross wage.
An SRL must maintain a registered office in Romania, though not premises from which it operates. Where no activity is carried on at the address, a single instrument suffices and the consent of the owner is not required. It must be registered with the Trade Register and with ANAF, and it must open a bank account within 60 business days of registration, failing which it risks a fine and classification as fiscally inactive.
The continuing obligations are modest but unforgiving of neglect: annual financial statements, an update to the beneficial ownership declaration within fifteen days of any change, and reclassification of activity codes to CAEN Rev. 3 by 25 September 2026. Existing codes can be mapped using our CAEN Rev. 2 to Rev. 3 converter.
The SRL suits the great majority of foreign founders: consultants and service providers with clients in several countries, software and technology businesses, e-commerce operations, and any venture where limited liability and the lowest available rate of tax are the governing considerations. The steps, the documents and the timetable are set out in our guide to incorporating a Romanian company.
The SA
An SA, societate pe acțiuni, is the Romanian joint stock company, corresponding to the German AG, the French société anonyme and the public limited company in the United Kingdom. It is the form used for capital intensive undertakings, for businesses raising institutional investment and for companies contemplating admission to a regulated market.
It requires at least two shareholders, with no upper limit, and a minimum share capital of RON 90,000, approximately €18,000, divided into shares of a nominal value of not less than RON 0.10. At least 30% of the subscribed capital must be paid up on incorporation, the balance falling due within twelve months. The company must have a board of directors, or alternatively a management board and a supervisory board, and must appoint a statutory auditor.
Profits are taxed at 16%, as for an SRL outside the microenterprise regime, but the SA cannot access that regime at all. Shares are freely transferable without amendment of the constitutional documents, which is the principal structural advantage: an investor may be admitted, or an exit effected, without a registry filing recording each transfer.
The SA is the right form where institutional investors require it, where the business is regulated in a sector reserved to the joint stock company, or where a listing is genuinely in contemplation. For founders who select it in the belief that it confers standing, the additional capital, the governance apparatus and the mandatory audit represent a substantial and usually avoidable cost.
The PFA
A PFA, persoană fizică autorizată, is the Romanian authorised sole trader. It is not a company. It has no legal personality separate from the individual who holds it, and the individual is liable for its obligations without limit and with personal assets.
No share capital is required. Registration is straightforward and takes one to two weeks. The holder must possess qualifications appropriate to the activity, must limit the activity to a small number of declared codes, and may employ no more than three people. Net income, after deduction of expenses, is taxed at 10%, with pension and health contributions calculated by reference to thresholds expressed in multiples of the minimum wage.
A non-EU citizen requires a Romanian residence permit to register a PFA. The threshold is citizenship rather than residence abroad, and the parallel with the banking requirements discussed below is not coincidental: in both cases what the authority is looking for is a Romanian identity document capable of direct verification.
The PFA suits an individual providing personal services, with a small number of clients, modest turnover and no exposure that unlimited liability would render unacceptable. It becomes unsuitable as soon as the business acquires employees, inventory, significant contractual exposure or the ambition to grow. Since October 2024 a PFA may be converted into an SRL through a procedure at the Trade Register, which mitigates but does not eliminate the cost of having chosen wrongly at the outset.
The Branch
A sucursală is a branch of a foreign company registered in Romania. It has no legal personality. It is an extension of the parent, which remains liable for its obligations without limitation, and it operates within the objects of the parent rather than under objects of its own.
No share capital is required. Registration takes two to four weeks and calls for the parent's constitutional documents, a certificate of good standing and a resolution establishing the branch, each apostilled and accompanied by certified Romanian translations. Profit attributable to the branch is taxed in Romania at 16%. The branch cannot access the microenterprise regime.
The branch is appropriate where a foreign group requires a registered presence in Romania tied to a specific contract or regulatory requirement, and where the parent is content to bear the liability directly. Where the object is to carry on business in Romania on a continuing basis, a subsidiary in the form of an SRL is almost always preferable: liability is contained, the microenterprise regime may be available, and the entity can be sold or capitalised independently of the parent. A branch cannot be converted into an SRL. Closure and fresh incorporation are required, though assets, contracts and employees can be transferred with planning.
How the Choice Is Usually Made
Three questions resolve most cases.
Does the business need limited liability? If it has employees, inventory, premises, or contracts under which a claim could exceed the owner's capacity to meet it personally, the answer is yes, and the PFA falls away.
Will turnover remain below €100,000, and will the business employ at least one person full time? If so, the SRL under the microenterprise regime carries the lowest burden available in the Union. If turnover will exceed the threshold, the comparison is between 16% on profit in an SRL and the treatment the founder would face in the jurisdiction of residence.
Is a separate entity required, or will an extension of an existing company serve? A group testing the market under a single contract may find the branch adequate. A group intending to trade in Romania on a continuing basis will generally prefer a subsidiary.
Where the choice lies between an SRL and a branch, or between an SRL and a PFA, it turns on liability and on eligibility for the microenterprise regime rather than on the cost of registration. Our tax calculator compares the actual burden across SRL micro, SRL profit and PFA on your own figures, and our service page sets out what incorporating an SRL involves in practice.
