From the debtor prison, to SRL with minimum capital. As it is in the EU and G7. Tips for entrepreneurs

Since the imprisonment of the debtors from the past centuries to the modern SRL with a share capital of 1 leu, the legislation has always oscillated between the entrepreneurial freedom and the protection of the creditors, and the proposal of the Government to increase the share capital to 8,000 lei, requires a comparative analysis with other EU and G7 states.

Today, the Government's proposal to raise the minimum threshold to 8,000 lei brings to the fore the purpose of establishing this measure, but also the effects it will produce: are we talking about a foundation in the business environment or an additional barrier for those who want to start a business?

“The Government's proposal to raise the minimum share capital to 8,000 lei for SRLs goes clear in the direction of having clear rules on a minimum capitalization and a basis for a bit of creditors, but its effects must be understood lucidly and compared to what other states do“Says Business Consultant Florin Leucă, who offered business consultancy for over 100 companies in Romania, London and Vienna. The specialist has made a comparative analysis of the share capital in the EU and G7 states.

While Germany, Austria, Sweden and Denmark retain significant thresholds, the European trend of the last 15 years has been to eliminate or reduce the minimum share capital (eloquent examples being France, Spain, NL, Belgium, Finland, Czech Republic, UK). The proposal of Romania of about 1,600 euros stands above the EU average, but far below Germany (a report of 1 to 15), and compared to the media G7 positions us more restrictively than the US, UK, Canada, Japan.

On the one hand, the minimum share capital reduces the “cardboard companies” and constitutes a guarantee for creditors and banks, a step towards normality and credibility in a society dominated by the lack of confidence. On the other hand, a barrier is created when entering entrepreneurship that can discourage the potential entrepreneur, may postpone the opening of the business, of fiscal and legal risk (the personal heritage being exposed, unlike SRL, where the liability is usually limited to the company's patrimony).

Pragmatic recommendations for entrepreneurs and future entrepreneurs

1.

Entrepreneurs can develop an internal calendar of capital increase (for example, in two installments of 4,000 lei or quarterly, 2,000 lei), recommends the business consultant Florin Leuca. They can save the amount in a dedicated account up to ONRC formalities.

2. Choosing the type of contribution:

a) cash, the simplest and fast.

b) in nature, useful if the associates already have equipment, fixed assets, but it must be taken into account the need to evaluate the goods by an expert according to the law of commercial companies and the ONRC indications.

3. Transforming associate loans in contribution to capital.

If the company has already benefited from loans from the associates, the accountant can register the conversion to share capital or capital bonuses, thus strengthening the balance sheet and credibility.

4. The alternative to start the business without an investment of 8,000 lei:

If 8,000 lei represent too much effort at the beginning of the entrepreneurial road, then the PFA/ II option is more suitable for the market validation, and once the business takes on traction, the transition to SRL can be made, with an appropriate capitalization. Many other states exactly encourage: a quick start and capitalization with the development of the business.

5.. Risk policies and financial instruments for business sustainability

At the same time, establishing clear risk policies (customer credit limits, deadlines that provide cash flow, consistently applied penalties), but also appealing to modern solutions such as factoring and commercial credit insurance, offers entrepreneurs protection, predictability and safety.

“In conclusion, we should remember that the limited liability company was born in the 19th century as a legal fiction to separate the personal heritage from that of the business and to avoid the dramatic situations of those who did not succeed, ending in the prisons of the debtors. which could suffer it is limited to the capital invested in the commercial company.

Today, the public debate on the minimum share capital of 8,000 lei for SRL is exactly in this logic: the state and the trading partners require a minimum guarantee of seriousness and responsibility. At the same time, entrepreneurs need that this rule is not a disproportionate one, in order not to transform the protection of creditors into an excessive barrier to entering entrepreneurship.

The true stake is the balance between the freedom to start a business and the responsibility towards the trading partners and the society as a whole. If the balance is respected then the minimum share capital together with the practice of some healthy risk policies And the use of modern financing tools will put the foundations of a savings based on sustainable trust and development ”, said the business consultant.