Considerations on nullity in case of companies under Romanian law

Author:Cristina Cojocaru
Position:Department of Law, Bucharest University of Economic Studies
Pages:45-51
SUMMARY

The company acquires legal personality after a series of formalities required by law are fulfilled, formalities that concern the constituent acts on which it is based. For this reason, it is very important to know the legal status of the company's constitutive acts and the consequences of their irregularities. Hence, both the essential conditions and the form of the company’s constitutive acts... (see full summary)

 
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Considerations on nullity in case of companies under Romanian law
Lecturer Cristina COJOCARU
1
Abstract
The company acquires legal personality after a series of formalities required by law
are fulfilled, formalities that concern the constituent acts on which it is based. For this
reason, it is very important to know the legal status of the company's constitutive acts and
the consequences of their irregularities. Hence, both the essential conditions and the form of
the company’s constitutive acts are analyzed based on the legal provisions. It is also
necessary to distinguish between the nullity resulting from the unlawful drafting of these
constitutive acts and the nullity of society as such. Therefore, this paper is focused on these
differences, as well as on certain practical issues about nullity starting from a recent court
decision handed down by the Romanian Supreme Court.
Keywords: Romanian law, company, companies’ law, nullity.
JEL Classification: K22
1. Introduction
The effect of a company’s incorporation is that a new legal entity, a new
statutory body emerges in the business area and such entity needs to comply with
several requirements provided by law in order to ensure the security and stability of
legal relations.
Such legal requirements cover conditions to be complied with by the
company at the time of incorporation, that is formalities provided by law which must
be fulfilled, as otherwise, the company may not be incorporated.
At the same time, the constitutive act(s) of incorporation based on which the
company is established and which regulates (regulate) the legal relations between
shareholders must be concluded as provided by law, as otherwise the company may
not be legally set up.
A recent case handled by the High Court of Cassation and Justice
2
reveals
certain difficulties that might be encountered in the judicial practice, when a
company’s nullity might be mistaken for the absolute nullity of a company’s
memorandum of association. The paper does not pretend to analyze exhaustively this
topic, but rather to underline certain important aspects.
1
Cristina Cojocaru Department of Law, Bucharest University of Economic Studies,
cristina.cojocaru@cig.ase.ro
2
High Court of Cassation and Justice, Civil Division II, Decision No. 1063 of 7 June 2016.

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