In brief
An Israeli developer building a project in Romania almost always operates through a Romanian limited liability company (SRL), which can register land in its name even when all its owners are Israeli. Setting up the company is relatively simple, but the decisions that determine the success of the project are who decides, what happens in a deadlock between partners, how the money returns to the owners and how the structure is taxed in Romania and in Israel. All of these are settled before signing for the land.
Key takeaways
- 1Under Law 312/2005 a citizen of a country outside the European Union does not register land directly in their own name, but a Romanian SRL in Israeli ownership can.
- 2Since Law 239/2025 (in force from 18 December 2025) the minimum capital for a new SRL is 500 lei.
- 3A company whose net assets have fallen below half of its share capital cannot repay shareholder loans, and this directly affects the developer's cash flow.
- 4In a company of two equal partners, the default rules of the Companies Law lead to deadlock. A decision-making mechanism is written in advance.
- 5A Romanian bank will ask to identify the beneficial owner and the source of the money before it opens an account.
The move from buying a single property to a development project changes all the legal questions. A person who buys one home in Romania usually manages without a company. A person who buys land, plans, obtains a permit, takes credit and sells units needs a Romanian legal entity to hold all of these.
This guide is intended for Israeli developers and investors building a structure for a first project in Romania. It deals with the questions that are worth settling before signing for the land, because after signing any change to the structure is more expensive and more complicated.
Why does an Israeli developer need a Romanian company?
Because of a restriction on foreign ownership of land. Law 312/2005 provides in article 6(1) that a citizen of a country outside the European Union may acquire land in Romania only under the conditions regulated by international treaties, and subject to reciprocity. In practice, an Israeli will not be registered as the owner of a plot in their private name.
A person buying a single home usually makes do with a Superficie right, that is, a right to erect a building and hold it on land belonging to someone else. For a developer this does not work, because the plot itself has to be planned, permitted and mortgaged to the bank. This is where the company comes in: an SRL is a Romanian legal entity even when all the shares are held by Israelis, so the plot can be registered in its name. For agricultural land outside the built-up area there are additional rules, and a separate check is required there.
Since Law 239/2025 (in force from 18 December 2025) the minimum capital for a new SRL is 500 lei.
What does the Companies Law require to set up an SRL?
Law 31/1990, the Romanian Companies Law, defines the building blocks:
| Component | What the law provides | Article |
|---|---|---|
| Shareholders (asociați) | From one shareholder up to a maximum of 50 | 5(2), 12 |
| Liability | Each shareholder is liable only up to the amount of their share of the capital | 3(3) |
| Director (administrator) | One or more directors, shareholders or not, appointed in the articles of association or by the general meeting | 197(1) |
| Registration | Application for registration with the county trade register within 15 days of signing the articles of association | 36(1) |
| Share capital | 500 lei for a new company, and 5,000 lei for a company whose net turnover in the previous year exceeded 400,000 lei | Law 239/2025, section VI |
The share capital rule is relatively new. Law 239/2025, which entered into force on 18 December 2025, replaced the old rule that allowed a company to be set up with almost no capital. A company that has crossed the turnover threshold tops up its capital by the end of the following financial year. The low capital says little about the size of the project: a development company is usually financed by shareholder loans and bank credit.
Romanian citizenship is not a requirement, either for the shareholders or for the director. The law merely lists who is not eligible to serve, for example a person convicted of certain offences (article 6(2)). The registration procedure is carried out by a lawyer licensed in Romania, together with the local professionals.
What will the bank, the accountant and the beneficial owners register ask of you?
Three bodies will want to know who stands behind the company and how it is run:
| Body | The requirement | The legal source |
|---|---|---|
| The beneficial owners register at ONRC | A declaration of the beneficial owner on registration and on every change. A holding of more than 25% is an indicator of a beneficial owner | Law 129/2019, articles 56(1), 19(5)(a), 4(2)(a) |
| The bank | Identification of the company and the beneficial owner and understanding of the purpose of the business relationship. Without completing the check, the account is not opened | Law 129/2019, articles 5(1)(a), 11 |
| The accountant and ANAF | Bookkeeping and annual financial statements for the tax authority | Law 82/1991, articles 1(1), 36 |
Where one of the shareholders is an Israeli company, fund or trust, the entire chain of ownership must be presented up to the private individual at its head. It is worth coming to the bank prepared with the articles of association, the details of the beneficial owners and documentation of the source of funds. As for the financial statements: late filing of the annual statements takes the company out of the micro-enterprise regime (article 52(2) of the Fiscal Code), so a Romanian accountant is needed from the very first month.
What happens to shareholder loans when the project is loss-making?
They may get stuck in the company. One of the amendments in Law 239/2025 prohibits a company from repaying to its shareholders money they lent to it, as long as the net assets in the annual financial statements are lower than half of the share capital (article 67(2^4) of the Companies Law). If the shortfall is not remedied within the period set by the law, the company may be required to convert the loans into capital (article 153^24(4^2)).
In a development project, where the construction years often end in an accounting loss, this rule can delay the return of money to the owners. The financing structure, the ratio of capital to loans and the repayment schedule must be planned in advance with a Romanian accountant and lawyer.
A local partner: in the company or by contract?
A Romanian partner has clear advantages: they know the municipality, the professionals on the ground and the prices. What needs to be decided is the legal framework through which they come in:
| Framework | How it works | When it is used |
|---|---|---|
| Shareholding in the SRL | Decisions are made at the general meeting of shareholders. A plot can be transferred to the company as a contribution in kind | When the partner is a full partner in the project |
| asociere în participațiune (joint venture association) | An agreement under which one party gives the other a share in the profit and loss of a defined operation (article 1949 of the Civil Code). It has no legal personality, and each party is liable to third parties only for itself (article 1951) | When the owner of the plot is not willing to sell it |
How is deadlock between partners prevented?
By determining in advance how decisions are made. If the articles of association are silent, the general meeting decides by an absolute majority, both of the shareholders and of the capital (article 192(1)). For shares to be sold to an outside party, unless otherwise provided, the consent of those holding three quarters of the capital is required (article 202(2)).
Where there are two partners with equal shares, these default rules may paralyse the company. The articles of association and the shareholders' agreement should therefore answer at least the following questions:
- On which matters each partner holds a veto, and on which a majority is sufficient.
- To what financial ceiling each authorised signatory is limited.
- How a deadlock is broken: an outside decision-maker, a mediation procedure, or a mechanism for buying out the other partner's share.
- What happens to a partner who has not provided the financing they committed to.
- To whom shares may be transferred, and who has a right of first refusal.
The agreement between the partners cannot override Romanian law or the articles of association, so it is drafted by a local lawyer, in coordination with the advisers in Israel.
Which structure suits which project?
| Structure | Suitable where | What to watch |
|---|---|---|
| An SRL owned by you alone | One developer holds the whole project | Who the actual director is and where decisions are made |
| A joint SRL with a Romanian partner | The partner brings land, connections or management on the ground | Shareholders' agreement, deadlock mechanism, signing rights |
| An SRL with several Israeli investors | Several partners finance together | Beneficial owner declaration, rules on selling shares, who finances when more money is needed |
| A joint venture association with a landowner | The landowner does not want to sell | In whose name the land is, what happens on termination, allocation of losses |
| A private purchase without a company | A single home and not a project | A Superficie right to the land and no more |
How is a development company taxed in Romania, and what happens in Israel?
Romanian corporate taxation has undergone several changes in 2025 and 2026. The table is based on the consolidated text of the Fiscal Code (Law 227/2015) as updated in August 2026:
| Tax | Rate | Notes |
|---|---|---|
| Corporate income tax | 16% of profit | Article 17 |
| Micro-enterprise regime | 1% of revenue | Article 51(1). Only for a company whose revenue in the previous year, including related companies, was up to 100,000 euros and which employs at least one employee (article 47). From the quarter in which the threshold is crossed, the company moves to corporate income tax (article 52(1)) |
| Dividend tax | 16% | On distributions from 1 January 2026 (article 43(2); for a non-resident article 224(4)(b)) |
In a project selling apartments or villas, the company's revenue will quickly exceed the micro threshold, so it is advisable to plan on the basis of corporate income tax.
The tax treaty between Romania and Israel has applied since 1 January 1999. The Romanian Fiscal Code provides in article 230(1) that if the treaty offers a rate lower than the statutory rate, the lower rate prevails. An amending protocol has been added to the treaty, and the relevant rate must be checked in the current text.
In Israel there is also something to check. If decisions in the Romanian company are in practice made from Israel, the Israel Tax Authority may treat it as an Israeli company, and in addition there are reporting obligations on holding a foreign entity. This picture is built with a tax adviser who knows both systems, before the company is even registered.
Before signing for the land: how we build the structure
We start from the project and not from the company: who the partners are, who finances, who decides and how the money is supposed to come back. From this follow the articles of association, the shareholders' agreement and the beneficial owner file. The incorporation, the registration and the opening of the account are carried out by a lawyer and an accountant licensed in Romania, and we coordinate the Israeli tax aspects with your tax adviser.
This article is general information, current as of October 2026, and is not legal or tax advice. Company and tax law in Romania and in Israel change frequently. Choosing a structure for a project requires individual advice before signing for the land.
Frequently asked questions
How much share capital is needed to open an SRL in Romania?
Under Law 239/2025, in force from 18 December 2025, 500 lei for a new company. A company whose net turnover in the previous year exceeded 400,000 lei needs capital of at least 5,000 lei, and tops it up by the end of the following financial year.
Can an Israeli be a shareholder and director of a Romanian SRL?
Yes. The Companies Law does not require Romanian citizenship from shareholders or a director, and lists only certain disqualifications. In practice the bank and the accountant will ask for identity documents and documentation of the source of funds.
Can a Romanian company owned by Israelis register land in its name?
Yes. It is a Romanian legal entity, and the restriction in Law 312/2005 applies to citizens and entities of countries outside the Union, not to a Romanian company. For agricultural land outside the built-up area, additional rules apply.
Is a Romanian partner required?
No. An SRL can be set up by a single shareholder, and the director does not have to be Romanian. A local partner is worthwhile when they bring land, know-how or management on the ground, and the relationship is then regulated in a shareholders' agreement.
When is a beneficial owner declaration filed?
On registration of the company and each time the beneficial owner changes, under article 56(1) of Law 129/2019. The declaration is recorded in the beneficial owners register kept at ONRC.
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- Legea societăților nr. 31/1990, text consolidat - legislatie.just.ro
- ANAF - Modificări ale Legii 31/1990 prin Legea 239/2025
- Legea 129/2019 pentru prevenirea și combaterea spălării banilor - legislatie.just.ro
- Legea 312/2005 privind dobândirea dreptului de proprietate privată asupra terenurilor de către cetățenii străini - legislatie.just.ro
- Codul civil - legislatie.just.ro
- Legea contabilității nr. 82/1991 - legislatie.just.ro
- Codul fiscal, Legea 227/2015 - legislatie.just.ro
- Israel Tax Authority - Convention for the Avoidance of Double Taxation with Romania
The information in this guide is general in nature and does not constitute legal or tax advice on any specific transaction. Every transaction is assessed on its own facts.