Legal structuring of an investment in Romania

For an investor, the question is not only whether a project looks commercially attractive.

The question is whether the investment can be carried out in the proposed form, whether the asset or company being acquired has the expected legal standing, and whether the transaction structure adequately protects the capital invested.

These points must be settled before signing.

Once a contract is signed, many of the essential elements of the transaction (the price, the warranties, the completion conditions, the exit mechanisms or the allocation of risk) are already fixed.

That is why legal structuring is not the stage that follows the investment. It is one of the conditions of the investment.

1. The first question: what is the investor actually buying?

The phrase "investment in a company" can describe very different legal operations.

The investor may buy shares in an existing company, acquire only certain assets, take part in a capital increase, set up a new company together with a local partner, fund the company through a mix of equity and debt, or combine several of these mechanisms.

In a share deal, the investor steps into the existing company, together with its legal history, contracts, assets and liabilities.

In an asset deal, the investor selects certain assets or parts of the business, and each transfer must be reviewed individually in terms of ownership, contracts, permits and any approvals required.

In a capital increase, the money goes into the company and the investor receives the agreed stake.

These structures can produce commercially similar outcomes, but the legal risks are different. That is why the form of the transaction must be chosen based on what the investor aims to achieve.

2. Due diligence must be done before the risk is bought

Before an acquisition, the investor needs to understand what actually exists in the company or project under review. That is the function of legal due diligence.

Depending on the project, the review may cover: the corporate structure; key contracts; assets; permits and licenses; existing litigation and risks; employees and management; intellectual property; real estate and its legal status.

The goal is not to produce the longest possible report. The goal is to identify the issues that can affect the price, the transaction structure or even the decision to invest.

3. The ownership and control structure must be set from the start

An investment is not just a percentage of the share capital. What matters is the rights that come with that percentage.

An investor may need the right to appoint directors, veto rights over key decisions, anti-dilution protection, information rights, rules on future funding, exit mechanisms, drag-along or tag-along rights, deadlock rules and restrictions on the transfer of shares.

For an SRL (Romanian limited liability company), the Companies Law provides that, unless the articles of association state otherwise, shares may be transferred to persons outside the company only with the approval of members holding at least three quarters of the share capital. Source: Law no. 31/1990, art. 202.

The documents of the existing company must therefore be reviewed before the acquisition mechanism is decided.

4. The term sheet or LOI can set the deal before the final contract

Many investments start with a Term Sheet, Letter of Intent (LOI), Memorandum of Understanding (MOU) or another preliminary document.

It can define the price or valuation mechanism, the stake acquired, the investment structure, the due diligence period, exclusivity, confidentiality, the main terms of the transaction, the timeline and the conditions for signing or closing.

A preliminary document should not be treated as a mere formality. It must be clear which provisions are binding and which elements remain open to negotiation.

5. Some investments must also be reviewed for CEISD clearance

For certain investments in Romania, the transaction structure must also be reviewed under the foreign investment screening regime.

Under the current form of OUG no. 46/2022 (Government Emergency Ordinance), as amended in March 2026, the investments covered by art. 3 para. (1) that concern the relevant sectors and whose value exceeds the EUR 5 million threshold are subject to screening and clearance by CEISD (the Commission for the Examination of Foreign Direct Investments). Investments below this threshold may also be screened if, by their nature or potential effects, they could affect national security or public order, or projects or programs of interest to the European Union. Source: OUG no. 46/2022, art. 3.

If clearance is required, the transaction documents must reflect this through appropriate conditions for closing.

6. Check whether the transaction is also an economic concentration

For investments that lead to acquiring control over a company, the merger control regime may also become relevant.

The Competition Law requires notification when the combined turnover of the undertakings concerned exceeds the RON equivalent of EUR 10 million and at least two of the undertakings concerned each had a turnover in Romania above the RON equivalent of EUR 4 million in the previous year. Source: Competition Law no. 21/1996, art. 12.

In some transactions, the CEISD review and the merger control review can run in parallel. The legal timeline must be set before the parties commit to closing on a specific date.

7. The investment agreement must turn identified risks into legal protections

Due diligence identifies the risk. The contract must establish who bears it.

Depending on the transaction, the documentation may include a Share Purchase Agreement (SPA), an Asset Purchase Agreement (APA), an Investment Agreement, a Shareholders’ Agreement (SHA), capital increase documents, financing agreements, security agreements and closing documents.

The main agreement must address, among other things, the price, representations & warranties, indemnities, conditions precedent, closing mechanics, limitation of liability and exit mechanisms.

The contract must reflect the actual investment, not just a standard template used in another transaction.

8. The price is not the only amount that needs structuring

An investment can involve more than paying a price to the seller.

Capital can reach the project through a capital contribution, a capital increase, a shareholder loan to the company, bank financing, intra-group financing, an in-kind contribution or hybrid mechanisms.

These options are not equivalent. They can have different effects on the investor's rights, the company's balance sheet, future cash flows and the tax structure.

That is why the legal component must be aligned with the tax and accounting review before the transaction is funded.

9. The beneficial ownership structure must remain transparent

An investment can also change the company's beneficial ownership structure.

Law no. 129/2019 requires the beneficial owner information to be updated whenever a change occurs, and when the identification details of the beneficial owner change, the declaration must be filed within 15 days of the change. Source: Law no. 129/2019, art. 56.

For international structures, this may require reviewing the entire ownership chain up to the individuals who exercise ultimate control.

The beneficial owner is also relevant for KYC, banking, financing, compliance and, in certain cases, for the authorities' review of the investment.

10. Closing is not the end of the project

After the investment is completed, the next steps may include registering the share transfer, amending the articles of association, updating the directors, updating the beneficial owner, implementing the new governance, access to the bank accounts, changing signing authorities, contractual integration, funding the company, operational reorganization and implementing the obligations assumed under the contract.

A well-documented transaction must also be workable in practice. Having the documents signed is not enough.

1. Investment objective
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2. Structure
   ↓
3. Due diligence
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4. Negotiation & documentation
   ↓
5. Approvals
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6. Signing
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7. Closing
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8. Implementation

11. How does BOSFORA approach an investment?

At BOSFORA, the review does not start with the question: "What contract do we need to sign?"

It starts with: "What does the investor want to achieve through this transaction?"

Based on the answer, we review the investment vehicle, the target company or asset, the ownership structure, the due diligence, the form of the transaction, the required approvals, the financing mechanism, the contractual documentation and the implementation after closing.

The legal component is then aligned with the tax, accounting, financing and operational aspects of the project.

The goal is not only to sign the contract. It is for the investment to work in the form in which it was negotiated. If you would like to discuss your project, write to us.

Frequently asked questions

What is legal due diligence?

It is the review of the legal standing of the company, the assets and the relationships relevant to the transaction. The goal is to identify the risks that can affect the structure, the price or the terms of the investment.

What is the difference between a share deal and an asset deal?

In a share deal, the shares in the company are acquired and the company continues to hold its assets and liabilities. In an asset deal, certain assets or parts of the business are acquired directly, and the transfer of each one must be reviewed according to its nature.

Is CEISD clearance mandatory for every foreign investment?

No. The regime applies depending on the nature of the investment, its value, the sector of activity and the other legal criteria. The general threshold set by art. 3 of OUG no. 46/2022 is EUR 5 million, but investments below this threshold can also be screened in certain situations.

Does a company acquisition always have to be notified to the Competition Council?

No. The obligation depends on whether there is an economic concentration and whether the legal thresholds are met. The relevant thresholds are a combined turnover above EUR 10 million and above EUR 4 million in Romania for at least two of the undertakings concerned.

Can the contract be signed before the approvals are obtained?

In some transactions, signing and closing are separate, and obtaining the required approvals is written into the contract as a condition for completion. The exact structure must be set based on the applicable clearance and the specifics of the transaction.

This material is for informational purposes only and does not replace the legal, fiscal, or administrative analysis of a specific situation.

Last updated: September 23, 2026