How to Set Up a Representative Office in Romania: A Practical Guide

Many foreign companies choose to test the Romanian market before committing to a full legal entity. A representative office offers a low-cost, low-risk way to establish a local presence for market research, promotional activities, and liaising with partners—without triggering the same tax and reporting obligations as a subsidiary. This guide explains what a representative office is, how to register one, and what to expect once it is operational.

What is a representative office?

Under Romanian law, a representative office is a structure without separate legal personality, created by a foreign company to carry out preparatory or auxiliary activities on its behalf. It is not a separate legal entity, meaning the parent company remains fully liable for its actions. The office operates under the name of the parent company, with the addition of the words "representative office" and the location.

What a representative office can and cannot do

The permitted activities are strictly limited to non-commercial functions. A representative office may:

• Conduct market research and analysis
• Promote the parent company's products or services
• Establish and maintain contacts with local partners, clients, and authorities
• Coordinate activities between the parent company and Romanian counterparts

However, a representative office cannot:

• Generate revenue or invoice clients
• Sign commercial contracts on its own behalf
• Engage in production, trade, or service delivery
• Import or export goods for commercial purposes

Any revenue-generating activity requires a different legal structure, such as a subsidiary (SRL) or a branch office.

Registration process

Registering a representative office is relatively straightforward, but documents from the parent company must be notarised and legalised. The typical steps are:

1. Prepare documents from the parent company: This includes the certificate of incorporation, articles of association, a board decision or resolution authorising the opening of the office, and the appointment of a local representative. All documents must be translated into Romanian and notarised or apostilled, depending on the country of origin.
2. Submit the application to the Trade Register Office: The application is filed with the Oficiul Registrului Comerțului (Trade Register) in the county where the office will be located. The application must include the purpose, duration, and address of the office, along with details of the appointed representative.
3. Obtain the registration certificate: Once approved, the office receives a unique registration code and is entered in the Trade Register. The certificate serves as proof of establishment.
4. Register for tax purposes: The office must register with the National Agency for Fiscal Administration (ANAF) to obtain a tax identification number. Even without income, the office has reporting obligations for payroll and possibly VAT.

The entire process typically takes between two and four weeks, depending on document preparation and office workload.

Tax and accounting obligations

A representative office is generally not subject to corporate income tax because it does not generate profit. However, it must comply with several administrative duties:

• Payroll taxes: If the office hires employees locally, it must withhold and remit income tax and social contributions according to Romanian labour law.
• VAT registration: Although the office cannot issue invoices for services, it may need to register for VAT if it acquires goods or services locally and wishes to deduct input VAT. This is usually optional but recommended to recover VAT on expenses.
• Accounting records: The office must keep simple accounting records of its expenses and submit annual declarations to the tax authorities, even if they show zero profit.

The parent company remains responsible for funding the office's operations; no local capital is required.

Practical considerations

Before opening a representative office, consider these points:

• Office space: You will need a registered address in Romania. Many companies opt for a virtual office or serviced office space to keep costs low.
• Local representative: The office must appoint a local representative who acts on behalf of the parent company. This person can be a Romanian citizen or a foreigner with a valid residence permit.
• Duration: The office is authorised for a specific period, which can be renewed. If the parent company later decides to establish a full subsidiary, the representative office can be converted or closed.
• Compliance: Even with limited activities, the office must comply with Romanian employment, data protection, and anti-money laundering rules.

For companies exploring the Romanian market, a representative office offers a flexible and low-commitment entry point. It allows you to build relationships, understand local demand, and plan a more substantial investment—all without the full obligations of a commercial entity.