Last updated: 16 March 2017
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When a shareholder wishes to leave a Limited Liability Company (SRL), it has to sell its shares either to another shareholder or to a third party. Shares may be sold either at nominal value or for a price superior to such value.
In order to be enforceable against third parties, share assignment must be registered with the Trade Registry. Here are some procedural elements you should know.
ASSIGNMENT REGISTRATION AND TRANSFER OF OWNERSHIP OVER THE SHARES
If the share assignment is made between the company’s shareholders, the registration of this operation with the Trade Registry is done in a single step (without opposition period), by following the simplest procedure.
If the shares are assigned to a third party, the operation will take place in a more complex procedure. In fact, once the share assignment deed is signed, the documents must be submitted to the Trade Registry.
Subsequently, an opposition period of 30 days begins to run; this period is provided by the law to the benefit of the company’s creditors, including the tax authority. Therefore, creditors and/or the tax authority can oppose the assignment if, on assignment date, the company has debts towards them. In practice, the tax authority does not hesitate to oppose such assignment for the smallest debt the company has towards it…
The 30 days opposition period begins to run after publication in the Official Journal of the company’s decision approving the share assignment.
If an opposition to the share assignment is made, the deadline for the registration of the assignment will be extended with the period the competent courts need in order to issue a ruling. Therefore, in practice, the company first has to pay its debt towards the creditor in question and then go to court and prove such payment and obtain a ruling by which the court dismisses the opposition.
Transfer of ownership over the shares will be effective on the date when the Trade Registry communicates the decision dismissing the opposition or on the date of expiry of the opposition period, if no opposition was submitted.
All share assignment operations (between shareholders or towards third parties) must also be registered in the Shareholders’ Registry.
TAXATION OF SHARE ASSIGNMENT OPERATIONS
Shares can be sold either at nominal value or at a higher value. In this latter case, the seller (the assignor) residing in Romania must pay in Romania a 16% tax on revenue/profit.
However, if the seller is a non-resident natural or legal person or if a tax convention was concluded with the country where the income beneficiary has its tax residence, the latter can invoke this Convention (provided that it submits a tax residence certificate, issued by its country of residence) and pay the tax in accordance with the Convention (generally, no tax to be paid in Romania, but income obtained from the sale must be declared in the other country).