Tuesday, July 8, 2014

The Legal System in Hungary

The legal system in Hungary is regulated by 5 types of institutions:
·         the Curia
·         the regional courts of appeal,
·         the regional courts,
·         the district courts and
·         the administrative and labor courts.
The Curia in Hungary
As the highest judicial authority in Hungary, Curia is run by a President and composed out of the following departments: civil, criminal and administrative. It is also known as the Supreme Court in this country. The responsibilities of this institution are numerous and extremely complex. Its attributions include analyzing, adopting, passing and publishing all decisions related to the Hungarian civil law and criminal areas. Uniform law enforcement is guaranteed by the Curia and its decisions are binding for other courts.
The President of the Supreme Court of Hungary is elected by the Parliament, with a two-thirds majority of its members, on the recommendation of the President of the Republic. At the time of his election, the future President must already be a judge.
The Regional Courts in Hungary
The 20 regional courts in Hungary act as first instance courts and their role is to review appeals submitted against district and administrative courts. The regional Courts are run by a President and they have a status of legal entities.
Regional Courts of Appeal in Hungary
The 5 regional courts of appeal must review appeals in second and third instance submitted against the decisions of district and regional courts or other cases submitted in their jurisdiction. There are 5 such courts in Hungary and they are led by a President. Just like the regional courts, the regional courts of appeal have a legal entity status.
The District Courts in Hungary
The 111 district Courts in Hungary act as fist-instance courts. They are led by a President and don’t have legal personality. Their role is to hear the majority of criminal and civil cases in first instance and their competency must conform to the area of public administration.
Administrative and Labor Courts in Hungary
The 20 administrative and labor courts in Hungary must judge first instance cases regarding administrative and employment decisions. They are led by a President, without having the legal personality status
For legal consultancy regarding the opening of a new company in Hungary please contact our attorney partners in Hungary.

Thursday, July 3, 2014

What are the main types of companies you can set up in Italy

A foreign investor interested in doing business in Italy may choose from a large variety of companies’ types the one that suits best its interests and goals. If you don’t know what type is more appropriate for your business, you may contact our Italian lawyers who will offer you tailored solutions and then they will help you register the new company and start doing business.
The main types of companies you can set up in Italy are:
- SRL – “Societa a responsabilita limitata” or limited liability company, the most common type of company, is chosen by the most foreign and local entrepreneurs who intend to run a small or medium business in Italy. The shares in this type of company cannot be bought freely by the public. Anyone who wants to open a limited liability company in Italy is required to pay a minimum capital share of 10,000 EUR.
- SpA – Societa per azioni or joint stock company is generally chosen by investors who want to run large businesses. Every shareholder is liable for the company debts depending on the amount paid for his shares. All the shares are registered with the Stock Exchange and can be bought by the public. For opening a joint stock company, you will need at least 120,000 EUR for the capital share.
- general partnership – is formed by an association of persons interested in running a certain business. This type of company has legal personality and all the partners are liable for the debts of the company. At the registration, every partner may bring his contribution in cash or goods, such as properties.
- limited liability partnership – can be set up by one or more persons, but one of them is the general partner, with unlimited liabilities, and the others are limited partners, with liabilities limited to their contribution at the company’s capital.
For opening a company in Italy you don’t have to go in person to this country for the registration procedure if you don’t want or you don’t have time. You may give the power of attorney to one of our lawyers who will handle the entire procedure of company registration.  


What type of company would you open in Poland?

Poland is the sixth largest EU member state and one of the most fast-growing economies in the world. Due to its position in Central Europe it provides entrepreneurs decided to invest in it with the opportunity of an easy access to the worlds’ biggest free market area. This means low transportation costs and more facile trading procedures for import and export activities within this area. The United Nations Conference on Trade and Development estimated in a report in 2013 that Poland will become the 4th European most attractive country for foreign investors

In this situation it is understandable that the number of investors turning towards Poland for businesses startups has increased considerably over the last few years. Poland provides them with a wide range of structures to choose from. Also, in case they consider the process of opening a new company in Poland to be too time consuming, foreign investors have to opportunity buy a shelf company that will allow them to start conducting their business immediately.

One of the most common is the Polish Limited Liability Company (Sp.z.o.o.) which requires a minimum share capital of 5,000 PLN and at least one shareholder in order to be established. The founders can be either individuals or legal entities and they liability is limited to the amount of shares they own. A Polish Joint-Stock Company (Spólkaakcyjna) is best suited for large size businesses and the setup process requires a minimum share capital of 100,000 PLN. Another type of partnership specially designed for large businesses is the Polish Limited Joint-Stock Partnership (Spólkakomandytowo-akcyjna) that requires a minimum share capital of 50,000 PLN.

Poland also offers a variety of partnership types to choose from. The Polish Limited Partnership (Spólkakomandytowa) must be formed by at least two individuals or legal entities. It has minimum one entirely liable partner and at least one limited liability partner. Taxes are paid by each of the individuals or organizational units that form the partnership in Poland.

The Polish Civil Partnership (Spólkacywilna) is a legal form with a relatively simple structure. It is usually chosen by small businesses and it is composed out of minimum two shareholders with common business goals. Although it is easy to set up, entrepreneurs should keep in mind the fact that this type of Polish company has no legal personality and it doesn’t’ require registration with the National Court Registry.

A special type of entity is the Polish Sole proprietorship because it only requires one founder and no minimum capital. There is no legal distinction between the business and the owner, who must be registered for paying taxes in Poland

Premises for the future development of Poland from the investments point of view look bright since the country’s economy is expected growth by 3.5% in 2015 and 3.8% in 2016.

Tuesday, July 1, 2014

Why invest in Romania?

Investors are always keen to find new opportunities for great investments. So why should they consider Romania as one of their choices? In 2013, Romania registered a 22.3 percent increase in direct foreign investment, according to data released by the National Bank of Romania. The amount of capital invested in the first 11 months of 2013 totalled some 2.4 billion EURO, even though the economic climate was not one of the friendliest at the time. 

Some of Romania's industries are very attractive, not only for foreign investors but also for local ones. The top 3 industries worth considering are agriculture, energy and tourism, these industries are mentioned by most of the studies and also recommended by embassies and chambers of commerce. 

One example of investment for the energy industry is the 91 million euro investment announced by E.ON on April 8th, 2014 for this year in order to upgrade its gas and electricity distribution networks. 

Real estate ownership 

Starting January 2014 , the acquisition of land in Romania and owning buildings has been liberalised for foreign citizens and legal entities under the same conditions and terms as Romanian citizens and legal entities. The conditions for the agricultural land require compliance of a pre-emption right. The new Civil Code states that the authentic form of the sale-purchase agreement does not suffice for ensuring ownership right over real estate. This implies that it is mandatory the transfer of registration with the relevant land book of ownership. This means the ownership right will be transferred when the inscription in the Real Estate Register is made. 

Corporate legal framework 

The most commonly types of companies used in Romania are limited liability companies (LLCs) and joint stock companies (JSCs). The same corporate tax applies to both types – a rate of 16%. The payments of profits for shareholders are being treated as dividents so they may be subject to specific taxation. 

The LLCs and JSCs offer a higher degree of protection for shareholders regarding the liability perspective. The LLC has the advantage of a very low share capital requirements (approximately 45 EURO) as opposed to the JSC – the minimum is about 20.000 EURO. More so, the LLC is governed by a simpler corporate structure, involving a less costs and a lighter operating burden. 


The Law no. 220/2008 regarding the promotion of renewable energy projects was created in order to support small projects and it provides opportunities for selling the energy produced at regulated fares, this case implies that the investor no longer benefits from green certificates. The producers accredited after January 1st, 2014 there will be a number of green certificates reduced out of the initial number of green certificates. For the projects already accredited, the E-RES target for the 2014 that benefit from the green certificates scheme was established at 11.1% by the ANRE. 


In Romania, investors may find skilled workforce for competitive prices (the average gross salary is 510 EURO/month, while the minimum gross salary is 190 EURO/month). There is also regulated a trial period for employees (it is not considered mandatory), the law provides up to 120 calendar days of trial period. During this time, the employer may fire the employee without any notice and motive. The contributions for social security system vary from 27.75% to 38.45% for the employer (it depends on the working conditions), while the employee's contribution is 32.5%. 

Other incentives 

The Government Emergency Ordinance no. 102/2013 (active from January 1st, 2014) states that the dividends received by holding companies, the revenues obtained by the holding companies and the capital gains acquired by the holding companies from the sales of shares in their subsidiaries are not taxable. Another incentive is offered for deductibility of expenses that are related to development activities and research, there is 5% VAT rate reduced for selling buildings under specific conditions or for the accelerated depreciation of certain assets. The general level of income and profit tax is preserved at 16% and this measure is favourable for new and stable investments.

For further information related to the legal framework for investing in Romania, you may contact our team of lawyers.