How to register a company in Romania?

In order to register a company in Romania, you need to choose the type of company form you want to incorporate, to prepare the necessary documents and to submit the application to the Romanian Trade Registry. Most common forms of companies in Romania are the Limited Liability Company (LLC), Joint Stock Company (SA) and sole trader (PFA).

How long does it take to open a company in Romania?

The company formation in Romania process will take 2 working days, since the date the incorporation application is submitted to the Romanian Trade Registry.

What is the main advantage to open a company in Romania?

One of the lowest taxation in EU: 1% turnover tax for the companies whose turnover does not exceed EUR 60,000 and have at least one employee or 3% turnover tax if the companies has a revenue exceeding EUR 60,000 or the companies is engaged in some specific activities.

Can I start a company in Romania as a foreigner?

Foreign citizens and legal persons can quickly and easily incorporate their own company in Romania, without any restrictions. There is no need for a Romanian shareholder and director

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16 November 2024

Everything You Need to Know Before Opening a Franchise in Romania

Opening a franchise in Romania is an excellent way to tap into a growing market filled with opportunities. From international fast-food chains to local service providers, franchises are gaining traction across the country. Whether you’re looking to invest in an established franchise business or exploring franchises for sale, understanding the legal, financial, and operational aspects is crucial to your success. This comprehensive guide covers everything you need to know, including legal authorizations, obtaining the right permits and licenses, and working with a franchise lawyer or franchise attorney solicitor to ensure compliance with Romanian franchise regulations.

opening a franchise in Romania, enfranchisement, franchise lawyer, franchise attorney, starting a franchise in Romania

Are you considering starting a franchise in Romania? With its booming economy, strategic location in Europe, and growing consumer market, Romania is quickly becoming a hotspot for franchise businesses. Whether you're an aspiring entrepreneur or an established business looking to expand, opening a franchise business in Romania offers numerous opportunities to tap into this thriving market. From identifying franchises for sale to understanding legal requirements such as obtaining the proper authorization, permit, or license, this guide covers everything you need to know. We'll also explore key aspects like enfranchisement regulations and why consulting a skilled franchise lawyer or franchise attorney is essential for success. Let’s dive into the essentials of starting a franchise in Romania and making your entrepreneurial dream a reality.

Why Choose Romania for Your Franchise?

Romania has become a hotspot for international and local franchises due to its strategic location in Europe, growing middle class, and increasing disposable income. Here are some compelling reasons to consider opening a franchise in Romania:

Key Benefits of Starting a Franchise in Romania

1. Growing Economy. Romania's GDP growth consistently outpaces the European average, creating a favorable environment for business expansion.

2. Consumer Trends. The demand for global brands and organized retail formats is steadily rising. Romanian consumers are embracing convenience, quality, and branded products and services. With a population of over 19 million and an expanding middle class, the demand for quality products and services is on the rise.

3. EU Membership. As a member of the European Union, Romania offers access to a common market of over 500 million people, making it easier to scale your franchise in Romania across borders.

4. Emerging Franchise Market. Romania's franchise market is still developing, meaning less competition and more opportunities for innovative concepts.

5. Strategic Location: Positioned at the crossroads of Europe, Romania offers access to both Western and Eastern European markets.

6. Diverse Franchise Opportunities: From food and retail to education and technology, multiple sectors offer lucrative franchise opportunities.

Understanding Romanian Franchise Business Basics

A franchise is a business arrangement where a franchisor grants the franchisee the right to operate a business using their brand, system, and support. In Romania, this structure is regulated under the EU framework and Romanian laws, ensuring transparency and fairness between parties.

Types of Franchises in Romania

Master Franchise: Grants the rights to develop and manage the brand within Romania.

Single-Unit Franchise: Allows operation of one franchise location.

Multi-Unit Franchise: Permits the opening of multiple locations under one agreement.

Legal Requirements for Starting a Franchise in Romania

Opening a franchise in Romania requires compliance with several legal and administrative steps. These include obtaining the necessary authorization, rights, permits, licenses, and meeting enfranchisement standards. Here’s what you need to know:

1. Franchise Agreement in Romania

A franchise agreement is a legally binding contract between the franchisor and franchisee that outlines the terms and conditions of operating a franchise business. It grants the franchisee the right to use the franchisor's brand, system, and support to establish and manage their business.

In Romania, franchise agreements are governed by national laws in alignment with the European Union’s franchising regulations. These laws ensure fairness, transparency, and adherence to ethical business practices.

Key elements of a franchise agreement in Romania include:

Intellectual Property Rights: Ensure trademarks and branding are registered and protected. The agreement specifies the franchisee’s right to use the franchisor's trademarks, logos, and other intellectual property. It ensures brand consistency across all franchise locations in Romania.
Fees and Payments. The financial structure is detailed in the agreement, including: initial franchise fees, ongoing royalties (percentage of revenue or fixed amount), marketing and operational fees, if applicable.
Duration of the Agreement. The contract outlines the term of the agreement, renewal conditions, and termination clauses. Typical franchise agreements in Romania last between 5 to 10 years, with options for extension.
Training and Support: Define the franchisor's obligations for onboarding and ongoing support. Franchisors are required to provide training and support to help franchisees establish and operate their businesses. The agreement specifies the scope and duration of this assistance.
Territorial Rights: Clearly outline the franchisee’s exclusive or non-exclusive operating territory. This section defines whether the franchisee has exclusive or non-exclusive rights to operate within a specified territory. It’s vital to understand these boundaries to avoid disputes.
Operational Standards. Franchisees must comply with the franchisor’s operational guidelines to maintain brand quality and customer experience. This includes rules on product offerings, service quality, and reporting procedures.
Termination and Dispute Resolution. The agreement should include clear terms for contract termination and procedures for resolving disputes, such as mediation, arbitration, or court proceedings.

Our specialized corporate and commercial lawyers are here to guide you through securing a franchise in Romania. From drafting the franchise agreement to ensuring all the negotiation process, compliance and implementation, we handle every detail so you can achieve your goals with ease.

2. Authorization and Permits

Before starting your franchise in Romania, you must obtain:

Business Registration: Register your business with the Romanian Trade Register.
Operational Permits: Depending on the industry (e.g., food, retail, education), specific operational permits may be required.
Health and Safety Licenses: For sectors like food and hospitality, health and safety compliance is mandatory.

3. Enfranchisement Rules

Romanian franchise law adheres to the European Code of Ethics for Franchising, which ensures fairness between franchisors and franchisees. Franchisors must provide detailed disclosure documents covering:

A description of the franchise model.
Financial performance projections.
Support and training details.

4. License to Operate Franchise in Romania

A franchise license in Romania grants the right to use the franchisor’s intellectual property, business model, and branding. Ensure that your franchise license clearly defines:

The duration of the agreement.
Renewal and termination terms.
Usage rights for intellectual property.

Market Insights for Franchises in Romania

Popular Franchise Sectors

Some of the most lucrative franchise opportunities in Romania include:

Food & Beverage: Fast food chains, coffee shops, and casual dining brands thrive in urban centers like Bucharest, Cluj-Napoca, and Timișoara.
Retail: Convenience stores, fashion brands, and specialty shops are gaining traction.
Services: Education, fitness, and beauty service franchises are increasingly popular.
Technology: Innovative tech-based franchises, such as coworking spaces and app-based services, are on the rise.

Urban vs. Rural Opportunities

While urban areas provide higher foot traffic and demand, rural regions in Romania are increasingly receptive to new business models. A careful analysis of local demographics is essential when selecting a location.

Steps to Start Your Franchise in Romania

1. Market Research. Analyze consumer preferences, competitors, and industry trends in Romania to identify the viability of your franchise model. Understanding the local market is essential. Research the demand for your chosen industry, target demographics, and competitor landscape.

2. Choose a Franchise Model. Decide between master franchising, single-unit franchising, or multi-unit franchising based on your goals and resources. Look for franchises for sale that align with your goals, budget, and expertise. Assess the franchisor’s track record, training programs, and ongoing support.

3. Secure Funding. Obtain financing through personal investment, bank loans, or partnership agreements. Franchises in Romania often require a mix of upfront costs, including franchise fees and initial investments. Determine the costs involved, including: initial franchise fees, real estate and location setup, equipment and inventory, marketing and operational costs. Funding can be obtained through personal savings, bank loans, or investment partnerships.

4. Register Your Business. Register your franchise with the appropriate Romanian authorities, including obtaining tax identification numbers and VAT registration.

5. Select a Location. Location is critical. Popular urban centers such as Bucharest, Brașov, and Constanța offer robust opportunities for franchises.

6. Comply with Legal Formalities. Obtain Necessary Licenses and Permits. Obtain all necessary permits, licenses, and authorizations. Work with a legal expert to ensure compliance with Romanian franchise laws. Ensure compliance with all industry-specific regulations by securing the required permits and operational licenses.

7. Hire and Train Staff. Recruit employees and ensure they receive proper training, especially if your franchise includes specific procedures or brand standards. Take advantage of franchisor-provided training programs to understand the operational model.

8. Launch Your Franchise. Plan a strong marketing campaign to announce your business opening and attract customers. Utilize local advertising, social media, and franchisor-provided promotional materials.

Challenges to Anticipate When Starting a Franchise in Romania

Opening a franchise in Romania also comes with challenges, such as:

Regulatory Hurdles: Navigating Romanian bureaucracy can be complex. Engage local consultants to streamline the process.
Cultural Adaptation: Tailoring your product or service to meet Romanian tastes and preferences may require adjustments.
Economic Fluctuations: Monitor economic conditions that could impact consumer spending.

Tips for Success in Romania’s Franchise Market

1. Localize Your Approach. Even global brands need to adapt to local cultural and economic conditions in Romania.

2. Partner with Experts. Work with local franchise consultants, legal advisors, and market researchers to ensure smooth operations.

3. Focus on Marketing. Invest in digital marketing strategies, including social media, to build brand recognition. Highlight the unique value of your franchise in Romania.

4. Prioritize Training. Equip your staff with the necessary skills and knowledge to maintain quality and service standards.

How a Franchise Lawyer or Attorney Can Help

A skilled franchise lawyer or franchise attorney plays a critical role in your franchising journey when reviewing or negotiating a franchise agreement in Romania by:

Ensuring your franchise agreement complies with Romanian laws. Verify that the agreement meets Romanian and EU legal requirements.
Advising on dispute resolution and exit strategies. A lawyer can help secure better fees, extended territorial rights, or additional support from the franchisor.
Protecting intellectual property rights. Ensure the agreement aligns with your goals and minimizes risks.
Assisting with renewals and transfers of licenses or permits. Franchise agreements often include complex legal language. A lawyer can break it down into understandable terms.

Our specialized corporate and commercial lawyers are here to guide you through securing a franchise in Romania. From drafting the franchise agreement to ensuring all the negotiation process, compliance and implementation, we handle every detail so you can achieve your goals with ease.

Conclusion: Your Guide to Opening a Successful Franchise in Romania

Starting a franchise in Romania is a rewarding way to tap into one of Eastern Europe’s fastest-growing markets. With its expanding economy, increasing consumer demand, and diverse opportunities across industries, Romania offers fertile ground for franchise success. Whether you're exploring franchises for sale or launching your own franchise business, understanding the steps, from obtaining the right authorization, permit, and license, to ensuring compliance with enfranchisement regulations, is essential.

To navigate the complexities of opening a franchise in Romania, working with a qualified franchise lawyer or franchise attorney is highly recommended. They can help review agreements, ensure legal compliance, and protect your investment. By planning strategically, researching thoroughly, and aligning with the right franchisor, you can build a thriving business and capitalize on the potential of the franchise Romania market.

Take the leap today, and turn your vision into a reality in this dynamic and promising market!

For further assistance and detailed guidance on any aspects related to franchise in Romania, feel free to get in touch with our lawyers at sorina@roadvocacy.ro or +40 744 65 09 50 or using the contact form on at www.roadvocacy.ro.

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Everything You Need to Know Before Opening a Franchise in Romania

Why Choose Romania for Your Franchise?

Romania has become a hotspot for international and local franchises due to its strategic location in Europe, growing middle class, and increasing disposable income. Here are some compelling reasons to consider opening a franchise in Romania:

Key Benefits of Starting a Franchise in Romania

1. Growing Economy. Romania's GDP growth consistently outpaces the European average, creating a favorable environment for business expansion.

3. EU Membership. As a member of the European Union, Romania offers access to a common market of over 500 million people, making it easier to scale your franchise in Romania across borders.

4. Emerging Franchise Market. Romania's franchise market is still developing, meaning less competition and more opportunities for innovative concepts.

5. Strategic Location: Positioned at the crossroads of Europe, Romania offers access to both Western and Eastern European markets.

6. Diverse Franchise Opportunities: From food and retail to education and technology, multiple sectors offer lucrative franchise opportunities.

Understanding Romanian Franchise Business Basics

A franchise is a business arrangement where a franchisor grants the franchisee the right to operate a business using their brand, system, and support. In Romania, this structure is regulated under the EU framework and Romanian laws, ensuring transparency and fairness between parties.

Types of Franchises in Romania

Master Franchise: Grants the rights to develop and manage the brand within Romania.

Single-Unit Franchise: Allows operation of one franchise location.

Multi-Unit Franchise: Permits the opening of multiple locations under one agreement.

Legal Requirements for Starting a Franchise in Romania

Opening a franchise in Romania requires compliance with several legal and administrative steps. These include obtaining the necessary authorization, rights, permits, licenses, and meeting enfranchisement standards. Here’s what you need to know:

1. Franchise Agreement in Romania

A franchise agreement is a legally binding contract between the franchisor and franchisee that outlines the terms and conditions of operating a franchise business. It grants the franchisee the right to use the franchisor's brand, system, and support to establish and manage their business.

In Romania, franchise agreements are governed by national laws in alignment with the European Union’s franchising regulations. These laws ensure fairness, transparency, and adherence to ethical business practices.

Key elements of a franchise agreement in Romania include:

Intellectual Property Rights: Ensure trademarks and branding are registered and protected. The agreement specifies the franchisee’s right to use the franchisor's trademarks, logos, and other intellectual property. It ensures brand consistency across all franchise locations in Romania.

Fees and Payments. The financial structure is detailed in the agreement, including: initial franchise fees, ongoing royalties (percentage of revenue or fixed amount), marketing and operational fees, if applicable.

Duration of the Agreement. The contract outlines the term of the agreement, renewal conditions, and termination clauses. Typical franchise agreements in Romania last between 5 to 10 years, with options for extension.

Training and Support: Define the franchisor's obligations for onboarding and ongoing support. Franchisors are required to provide training and support to help franchisees establish and operate their businesses. The agreement specifies the scope and duration of this assistance.

Territorial Rights: Clearly outline the franchisee’s exclusive or non-exclusive operating territory. This section defines whether the franchisee has exclusive or non-exclusive rights to operate within a specified territory. It’s vital to understand these boundaries to avoid disputes.

Operational Standards. Franchisees must comply with the franchisor’s operational guidelines to maintain brand quality and customer experience. This includes rules on product offerings, service quality, and reporting procedures.

Termination and Dispute Resolution. The agreement should include clear terms for contract termination and procedures for resolving disputes, such as mediation, arbitration, or court proceedings.

Our specialized corporate and commercial lawyers are here to guide you through securing a franchise in Romania. From drafting the franchise agreement to ensuring all the negotiation process, compliance and implementation, we handle every detail so you can achieve your goals with ease.

2. Authorization and Permits

Before starting your franchise in Romania, you must obtain:

Business Registration: Register your business with the Romanian Trade Register.

Operational Permits: Depending on the industry (e.g., food, retail, education), specific operational permits may be required.

Health and Safety Licenses: For sectors like food and hospitality, health and safety compliance is mandatory.

3. Enfranchisement Rules

Romanian franchise law adheres to the European Code of Ethics for Franchising, which ensures fairness between franchisors and franchisees. Franchisors must provide detailed disclosure documents covering:

A description of the franchise model.

Financial performance projections.

Support and training details.

4. License to Operate Franchise in Romania

A franchise license in Romania grants the right to use the franchisor’s intellectual property, business model, and branding. Ensure that your franchise license clearly defines:

The duration of the agreement.

Renewal and termination terms.

Usage rights for intellectual property.

Market Insights for Franchises in Romania

Popular Franchise Sectors

Some of the most lucrative franchise opportunities in Romania include:

Food & Beverage: Fast food chains, coffee shops, and casual dining brands thrive in urban centers like Bucharest, Cluj-Napoca, and Timișoara.

Retail: Convenience stores, fashion brands, and specialty shops are gaining traction.

Services: Education, fitness, and beauty service franchises are increasingly popular.

Technology: Innovative tech-based franchises, such as coworking spaces and app-based services, are on the rise.

Urban vs. Rural Opportunities

While urban areas provide higher foot traffic and demand, rural regions in Romania are increasingly receptive to new business models. A careful analysis of local demographics is essential when selecting a location.

Steps to Start Your Franchise in Romania

1. Market Research. Analyze consumer preferences, competitors, and industry trends in Romania to identify the viability of your franchise model. Understanding the local market is essential. Research the demand for your chosen industry, target demographics, and competitor landscape.

4. Register Your Business. Register your franchise with the appropriate Romanian authorities, including obtaining tax identification numbers and VAT registration.

5. Select a Location. Location is critical. Popular urban centers such as Bucharest, Brașov, and Constanța offer robust opportunities for franchises.

7. Hire and Train Staff. Recruit employees and ensure they receive proper training, especially if your franchise includes specific procedures or brand standards. Take advantage of franchisor-provided training programs to understand the operational model.

8. Launch Your Franchise. Plan a strong marketing campaign to announce your business opening and attract customers. Utilize local advertising, social media, and franchisor-provided promotional materials.

Challenges to Anticipate When Starting a Franchise in Romania

Opening a franchise in Romania also comes with challenges, such as:

Regulatory Hurdles: Navigating Romanian bureaucracy can be complex. Engage local consultants to streamline the process.

Cultural Adaptation: Tailoring your product or service to meet Romanian tastes and preferences may require adjustments.

Economic Fluctuations: Monitor economic conditions that could impact consumer spending.

Tips for Success in Romania’s Franchise Market

1. Localize Your Approach. Even global brands need to adapt to local cultural and economic conditions in Romania.

2. Partner with Experts. Work with local franchise consultants, legal advisors, and market researchers to ensure smooth operations.

3. Focus on Marketing. Invest in digital marketing strategies, including social media, to build brand recognition. Highlight the unique value of your franchise in Romania.

4. Prioritize Training. Equip your staff with the necessary skills and knowledge to maintain quality and service standards.

How a Franchise Lawyer or Attorney Can Help

A skilled franchise lawyer or franchise attorney plays a critical role in your franchising journey when reviewing or negotiating a franchise agreement in Romania by:

Ensuring your franchise agreement complies with Romanian laws. Verify that the agreement meets Romanian and EU legal requirements.

Advising on dispute resolution and exit strategies. A lawyer can help secure better fees, extended territorial rights, or additional support from the franchisor.

Protecting intellectual property rights. Ensure the agreement aligns with your goals and minimizes risks.

Assisting with renewals and transfers of licenses or permits. Franchise agreements often include complex legal language. A lawyer can break it down into understandable terms.

Our specialized corporate and commercial lawyers are here to guide you through securing a franchise in Romania. From drafting the franchise agreement to ensuring all the negotiation process, compliance and implementation, we handle every detail so you can achieve your goals with ease.

Conclusion: Your Guide to Opening a Successful Franchise in Romania

Take the leap today, and turn your vision into a reality in this dynamic and promising market!

For further assistance and detailed guidance on any aspects related to franchise in Romania, feel free to get in touch with our lawyers at sorina@roadvocacy.ro or +40 744 65 09 50 or using the contact form on at www.roadvocacy.ro.