Starting a business in Romania can be an exciting opportunity, especially with the country’s growing economy and its position as a gateway to European markets. But before jumping into the entrepreneurial world, one of the first questions you’re probably asking is: How much does it actually cost to open a business in Romania?
The answer isn’t as straightforward as you might hope. There are several factors that can influence the overall costs, from the type of business entity you choose to set up, to the legal fees, administrative costs, and ongoing operational expenses. This article will break down the key costs you should be aware of when considering opening a business in Romania.
1. Choosing the Right Business Structure
When setting up a business in Romania, the first major decision is choosing the legal structure. The two most common types of business entities are PFA (Sole Trader) and SRL (Limited Liability Company). The choice between these will significantly influence your startup costs.
- PFA (Persoana Fizica Autorizata): This is a sole trader or freelancer, where you are personally responsible for your business. It’s often simpler and cheaper to set up, but it comes with personal liability.
- SRL (Societate cu Raspundere Limitata): The most common type of company in Romania. It offers limited liability protection, which means your personal assets are not at risk in case the business runs into financial difficulties.
The costs to register these entities vary slightly:
- PFA Registration: Costs are minimal, ranging between 50 and 100 EUR, depending on your specific business activities and any associated permits.
- SRL Registration: Registration costs for an SRL typically range from 200 to 500 EUR. This includes fees for registering the company at the Trade Registry, publishing the official announcement, and other administrative costs.
In both cases, it’s recommended to work with a legal advisor to ensure everything is properly handled. For instance, Buju, Stanciu & Asociatii can assist in ensuring that your business is registered smoothly and without complications, potentially saving you from costly mistakes later on.
2. Mandatory Capital Requirements
For certain business structures, Romania has mandatory capital requirements. For an SRL, the minimum share capital is 1 RON, which is symbolic. However, many entrepreneurs opt for a slightly higher amount (typically between 100 and 200 RON) for operational flexibility.
There is no mandatory capital requirement for PFA registrations, which is one of the reasons it’s cheaper and easier to set up.
3. Legal and Administrative Costs
It’s always a good idea to work with professionals when setting up a business to avoid issues down the line. Here’s a breakdown of potential legal and administrative fees:
- Legal Fees: Whether you opt for a PFA or an SRL, consulting with a lawyer is highly recommended. Lawyers can guide you through the documentation, ensure your business is legally compliant, and handle any unforeseen challenges. Typical legal fees for setting up an SRL range from 300 to 800 EUR, depending on the complexity of your business.
- Accounting Fees: Romania has specific accounting requirements depending on the type of business you run. For an SRL, you will need to hire an accountant, as the law requires maintaining double-entry bookkeeping. Monthly accounting fees start at 100 EUR for small companies, but this can increase as your business grows or if you deal with more complex transactions. For a PFA, accounting is simpler and may not require an ongoing accountant, although many still choose to hire one to keep their books in order.
- Notary and Administrative Fees: The Romanian Trade Registry requires several documents to be notarized, particularly for SRL registrations. These fees can add up to around 100 EUR.
4. Business Premises and Utility Costs
One of the bigger considerations when opening a business in Romania is deciding where your business will be located.
- Home-Based Business: For small businesses or freelancers operating as a PFA, working from home is a viable option and can significantly reduce costs. In this case, your only expenses may be utilities and possibly upgrading your home office space.
- Renting Office Space: If you’re setting up a company that requires physical office space, you’ll need to factor in rental costs. Office rent varies depending on the city and location. In Bucharest, for example, office space in the central areas can cost anywhere from 10 to 25 EUR per square meter. If you’re starting small, you can look into shared office spaces, which are more affordable and flexible, with prices starting around 100 EUR per month for a desk in a co-working space.
- Utilities: The cost of utilities (electricity, internet, etc.) will also vary based on your business needs, but for a small office, you can expect to pay 100 to 200 EUR per month.
5. Permits and Licenses
Depending on the nature of your business, you may need specific permits or licenses. This could include anything from health and safety certifications to environmental permits.
For example, if you are opening a restaurant, you’ll need a food and hygiene permit, which comes with its own set of fees and compliance requirements. Similarly, if you’re opening a retail store, you’ll need permits from local authorities.
Permit costs vary widely, ranging from 50 to 500 EUR, depending on the type of business and local regulations. It’s important to research what your specific business might need and budget accordingly.
6. Marketing and Branding Costs
Once your business is set up, it’s time to let people know about it! Whether you’re a local café or an online consultancy, marketing is a key part of attracting customers.
- Website: Building a professional website can range from 500 to 2,000 EUR depending on the complexity and functionality you need. A basic website with a few pages and contact information will be on the lower end, while a fully integrated e-commerce platform will cost significantly more.
- Marketing Campaigns: You’ll also want to consider the cost of marketing your business through digital channels, social media, or traditional advertising. A well-rounded digital marketing strategy, including social media ads, Google ads, and content marketing, can start at 200 EUR per month and go up depending on how aggressively you want to promote your business.
7. Ongoing Business Costs
Finally, after your business is up and running, you’ll have ongoing operational costs. These can include:
- Employee salaries: The minimum wage in Romania is currently 3,000 RON (about 600 EUR) per month, but skilled employees, particularly in industries like tech, finance, or marketing, will demand higher salaries. You’ll also need to factor in payroll taxes and social security contributions.
- Taxes: Depending on whether you set up a PFA or SRL, your business will be subject to different tax obligations. Small SRLs with a turnover of less than 1 million EUR can benefit from a 1% tax on revenue if they have employees, while PFAs are taxed on income, plus health and social contributions.
Conclusion: Is It Worth It?
So, how much does it cost to open a business in Romania? In summary, the costs can vary based on your business type and specific needs, but on average:
- PFA setup: 200 to 400 EUR
- SRL setup: 500 to 1,500 EUR (depending on legal and administrative fees)
- Ongoing monthly costs (accounting, rent, utilities): 500 EUR and up
Starting a business in Romania can be both affordable and profitable, but like any business venture, it requires careful planning and understanding of all potential costs.
If you’re looking for expert legal advice on setting up your business, the team at Buju, Stanciu & Asociatii is ready to assist. Whether you’re unsure about the legal structure, or need help navigating permits and tax obligations, their expertise ensures that your business is set up for success. Contact them today for a consultation and get started on your entrepreneurial journey!
