What is treasury management? Find out in this helpful guide to companies trading overseas.
Romania has become an appealing destination for expats looking to establish their businesses. Several factors make the country an attractive choice. Its geographic position lets it serve as a gateway to the Balkans, promising significant growth opportunities.
The country's business environment has garnered favourable recognition on the global stage, evident in its impressive rankings in international business surveys like World Bank.¹
UK businesses can benefit from the Romanian market due to its large domestic consumer base, favourable business environment, educated workforce, steady economic growth, EU membership advantages, lower operational costs, and diverse sector opportunities.
In this article, we will explore how to do business in Romania as a UK entrepreneur, how to benefit from the Romanian market, and successfully conduct business in this promising European destination. We will also cover how you can get paid like a local when doing business in Romania with a Wise Business multi-currency account.
The Romanian business culture is hierarchical and formal, with a strong emphasis on reverence for seniors and elders. In general terms, junior associates do not firmly stand against decisions made from the top of the tree, and there's a sense of respect.
Some standard Romanian business etiquette is as follows:²
- Romanian nationals are warm and welcoming to foreigners.
- Handshakes are the usual form of greeting, and sometimes, older men may kiss a woman's hand in greeting.
- Business cards are essential and should be exchanged during meetings.
- Flowers are popular gifts for various occasions, but offering an odd number is essential as even numbers are associated with funerals.
- Casual wear is generally acceptable for social events, while formal attire may be required for evening entertainment.
- In conversations, formal titles like "domnul" (sir) and "doamna" (madam) are used. Still, first names are common among young people and in business with English-speaking partners.
- Saying "pofta buna" (bon appétit) before meals and "noroc" (cheers) before drinks is customary.
If you are starting a business in Romania or expanding your UK business to Romania, it will open doors to diverse industries with promising potential. Identified opportunities lie in the following:
- Healthcare and Life Sciences
- Retail sectors
Romania's strategic location within the Central and Eastern European (CEE) region offers easy access to over 100 million consumers, making it an attractive market for British businesses. English is widely used as the business language and is a gateway to other CEE markets.
Starting a new investment in Romania gives you an advantage in logistics, employment costs, and workspace rental. Business spaces are available at reasonable prices in different cities, including Bucharest.³
Retail and FMCG sectors stand out as lucrative options with attractive profit prospects. The construction industry is also experiencing significant growth.
One of Romania's key attractions for investors is its highly skilled and affordable workforce, including engineers proficient in foreign languages - a rarity in many other countries. As a UK business, you have an opportunity to embrace the potential of Romania's vibrant market and seize the rewarding opportunities it offers.
To open a business in Romania, you need to follow these steps:
- Step 1: Choose what type of company you want, usually a limited liability company (SRL).
- Step 2: Choose and reserve a company name at the local Trade Registry.
- Step 3: Prepare your company incorporation file with the required documents and fees.
- Step 4: Open a Romanian bank account for your company.
- Step 5: Register the company to the National Trade Register and the Ministry of Public Finance.
- Step 6: Set up an electronic staff register and pay the social contributions.
- Step 7: Adapt your activity to the working conditions in Romania.
Suppose you are starting a business in Romania as a foreigner. In that case, you can open several types of companies in Romania, including joint stock companies (societate pe actiuni or JSC) and limited liability companies (societate cu raspundere limitata or LLC).
These are the most commonly used, given their flexible incorporation procedure and limitation of the shareholders' liability. For more information on foreign entity classification for UK tax purposes, you can refer to the HMRC internal manual.⁴
Doing business in Romania presents both challenges and opportunities for new businesses. Some challenges include the oversized role of the government in the economy. Others include dealing with corruption, bureaucracy, political instability, poor infrastructure, and frequent legislative changes without prior private sector consultations.
Suppose you already have a customers in Romania. In that case, you might be interested in get to know Wise Business. The multi-currency account that lets you receive, hold, convert, and manage your money with fair and transparent fees. Wise Business is a smart alternative to traditional bank accounts for international businesses.
With Wise Business, you can get Romanian account details for free and use them to receive payments from your customers or partners in Romania.
You don't need a local address or a Romanian bank account to get these details. You can check the requirements to open a Wise Business account and follow these steps:
- Sign up for a Wise Business account.
- Activate the Romanian leu (RON) currency balance.
- Then you can share your account details with anyone who needs to pay you in RON.
- You will receive the money in your Wise Business account without any conversion fees or hidden charges.
You can also hold over 40 currencies in your Wise Business account and convert them whenever you need to with the real mid-market exchange rate and low fees. Also, you can see the fees upfront before you make a conversion, so you always know what you're paying for. You can manage your money with features like batch payments, invoices, debit cards, Xero integration, and more.
Wise Business is a great solution for entrepreneurs who want to get paid like a local in Romania and save money on international transfers. You can sign up for a free account today and start enjoying the benefits of Wise Business.
In summary, understanding and respecting Romanian business culture, along with leveraging the country's advantageous position and opportunities, can pave the way for successful ventures and growth for UK businesses in Romania.
- Romania economy profile
- Romania - Business Travel and Etiquette
- 43 business centers: Bucharest
- Considerations when using the List of Classifications of Foreign Entities for UK tax purposes - HMRC internal manual - GOV.UK
Sources last checked August 16, 2023
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
A guide to international treasury management for UK entities, including what it is and best practices.
In the fast-evolving world of pet e-commerce, one company has ridden to the forefront with its dedication to top-notch care, products, and helpful content...
New research by Wise Business has revealed the reality of international payments for SMEs in the North of England and what this means for expansion plans
Ramp is a partner of Wise and a leading finance operations platform that brings together spend management, price intelligence, and finance automation to help...
The ultimate guide to key features in the Wise Business account that will help you to grow your business without borders.