Written By: Mihaela Cracea, Esq.

Pachiu & Associates

Bucharest, Romania

The access of foreign citizens to the Romanian employment market is recognized by domestic laws and has been proven to be a very dynamic and valuable influx channel providing a highly qualified and trained work force.

The most demanding industries for skilled foreign work force in Romania are, broadly, the automotive industry, telecommunications, trade and petroleum industry, etc. While the most desired job positions are CEO, CFO, sales managers, marketing managers, supply planning manager, as well as the technical positions of engineer, operations specialist and others.

Moreover, multinational companies are frequently appointing employees of the parent companies as directors of their Romanian subsidiaries. In most of the cases, they decide to relocate the directors to oversee the development and all the activities of the subsidiary company, and sometimes they apply to obtain a residence permit for such directors in Romania.

Factors including how easy it is to access the Romanian employment market, how many documents need to be submitted to public authorities, and how long and time consuming the procedures are, vary depending on the type of residence you want to obtain for foreign citizens. (In this article, the term “foreign citizen” refers to citizens outside UE/SEE/Swiss Confederation. The citizens of the latter are assimilated with Romanian nationals and benefit from the same treatment with regard to access to the Romanian employment market.)

Consequently, in relation to foreign citizens, the most commonly used procedures are those related to the following types of residence permits: (i) for commercial activities; (ii) as director of a Romanian company; (iii) for  assigned employee; (iv) as employee of a Romanian company.

The common feature of all the above types of residence permits is the initial term of validity, which is one year. Further extensions, where possible, are also provided for successive terms of one year.

In other words, in order to maintain the right of residence in Romania for more than one year, irrespective of the type of such residence, foreign citizens are required to apply each year for the relevant extensions.

Regarding the differences between the above options, although we are not aiming here to provide a detailed description of each procedure, we will try to provide an overview of the essential features of such procedures, in terms of the main conditions to be accomplished when accessing them.

The residence permit for commercial activities is open to the shareholders of Romanian companies, either limited liability companies or joint-stock companies.

The approval of the Romanian Centre for the Trade and Foreign Investments Promotion (RCTFIP) is the main and preliminary condition for obtaining the residence permit as shareholder of a Romanian company.

Such approval is issued under the following conditions: the value of the shares the applicant owes within a Romanian company is at least EURO 100,000, if the company is a limited liability one and of EURO 150,000 if the company is a joint-stock company. Moreover, the applicant is required to submit a 12-month business plan regarding the development of such a Romanian company. For further extensions of the residence permit, proof that the applicant has actually implemented the business solutions outlined in the business plan and that it has created at least 10 job positions within the company (for limited liability companies) and at least 15 job positions (for joint-stock companies) is an important requirement.

The second type of residence permit, namely the residence permit as director of a Romanian company, is obviously open to the directors registered with the Romanian Trade Registry. The most important restriction of this type of residence permit is related to the number of directors of the same company able to obtain such residence permit. Only one director may obtain this permit. Moreover, this director must not have been a shareholder within the company or within any other Romanian company in the past two years. Further, it is mandatory for the company to have a share capital of at least EURO 50,000. or to have acquired technology with a value of at least EURO 50,000. Fulfilment of such conditions is also required for all further extensions of the residence permit.

The third type of residence permit is the residence permit for assigned employees. The employees’ assignment from a foreign company to a Romanian one is, in most of the cases, an intragroup practice. Foreign citizens, employed with a company from their home country, are usually assigned to a Romanian company pertaining to the same group of companies in order to support a specific business division of the host company in relation to which they have previously acquired significant expertise.

Such residence permit implies, as a preliminary step, the recognition by the Romanian Ministry of Education of the assigned employee’s professional education.

This certificate of recognition is one of the documents which should be submitted for obtaining the work authorization as assigned employee. Absent such work authorization, no residence permit can be granted.

The most important documents that need to be submitted to the Romanian authorities for obtaining the work authorization are, in addition to the recognition certificate, the services agreement executed between the assignor and assignee companies, the assignment order, the criminal record of the employee, the fiscal certificate proving that the Romanian company has no outstanding payments to the Romanian public budget.

The downside of this type of residence permit is that it cannot be renewed. It is valid only for one year.

The fourth type of residence permit, and the most common one, applies to the employment of foreign citizens by Romanian companies.

Although more difficult to obtain, it might be renewed on yearly basis, for an unlimited period of time.

The preliminary procedures are the same as for the residence permit for assigned employees, with one additional requirement which implies a specific recruitment procedure to be carried out by the Romanian employer.

Such procedure is meant to verify if the position for which the foreign citizen is going to be hired might be occupied by a citizen of UE/SEE/Swiss Confederation.

In this respect, the company should notify the Labour Force Agency in relation to the vacant position, asking     if any citizen of UE/SEE/Swiss Confederation with a proper qualification is recorded in their dabatase and is fit for the envisaged position. After perfoming the necessary searches within its internal database, the Labour Force Agency will issue a certificate attesting the vacancy of the position or, on the contrary, will inform the company that a citizen of UE/SEE/Swiss Confederation has been identified as suitable for that specific   job position.

Although all the above procedures might be perceived, to some extent, complicated and time consuming, if the legal terms are observed and the documents have the accuracy required by the legal provisions, the obtainment of either of the above types of residence permits might become flexible and easy to accomplish.

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