Elimination of the legality control exercised by the judge upon registration in the Trade Register and the impact of this measure

I. Context

On July 26 th 2022, the Law No. 265/2022 on the Trade Register and for amending and supplementing with impact on other normative acts affecting the registration by this institution was published in the Official Journal. This law shall enter into force on November 26 th 2022.

Among those regulated by the above-mentioned law is the procedure for registration in the Trade Register based on the registrar’s control.

In this article, we are going to address a matter of general interest concerning the preliminary procedure before the National Trade Registry Office and the authority empowered to carry it out.

II.  The control of the legality of acts or facts that are registered by the Trade Register

a) Prior to the entry into force of Law No. 265/222 of July 26th 2022

According to Article 37 of Law no. 31/1990," (1), The control of the legality of acts or facts which, according to the law, are registered in the Trade Register is exercised by the justice through a delegate judge. (2) At the beginning of each judicial year, the president of the court shall delegate one or more judges of the court to the Trade Register Office."

Legality control is also regulated by art. 8 para. (1) of the Law no. 26/1990 on the Trade Register, "The legality control of the operations carried out by the Trade Register Office shall be carried out by one of the judges of the County Court or of the Bucharest City Court, delegated annually by the President of this Court. (2) The delegated judge shall control the operations of the trade register at least once a month.

Currently, although the articles previously rendered assing to the delegated judge the competence to carry out this control, in fact, this competence was transferred by the Emergency Ordinance No. 116/2009.

Thus, according to article 2 para. (1) of GEO no. 116/2009, "The competence to decide on applications for registration in the trade register and other applications within the competence of the delegated judge belongs, until the regulation of the activity of registration in the trade register carried out by commercial registrars, to the director of the commercial register office of the court and/or the person or persons designated by the Director General of the National Commercial Register Office."

The above-mentioned regulation is in force from January 14  2010 until November 25 th 2022, when Law no. 265/2022 comes into force.

Among the reasons for transferring this power from the delegated judge to the Director of the Trade Registry Office is the need to resolve the existent blockage in the institution as soon as possible. The blockage impacted the traders’ rights, with consequences for the trade circuit.

The desired effect of this ordinance was to decongest judicial activity by taking measures to remedy the overload and to respect the deadlines established for the issuance of certain certificates or documents.

Further, in accordance with art. 6 para. (1) of the above-mentioned Ordinance "In the settlement of applications for registration in the trade register, the Director of the Trade Register Office of the Court and/or the person designated authorize, by resolution, the foundation of companies, the making of all registrations in the Trade Register, the publicity, and the registration in the trade register of the standard statements on your own responsibility.’’

A complaint may be filed against this resolution within 15 days of its pronouncement, for the parties. This term shall be calculated from the publication date of the bylaws amending act by the Official Journal, for any other interested person. Within 3 days from the date of filing, the Trade Registry Official shall submit the complaint to the court.

According to the doctrine[1] "Once the delegated judge was removed from the registration procedure, we can no longer talk about a control of legality of act and facts, the procedure becomes one of administrative control.’’ Thus, the procedure is strictly administrative "what the Trade Register Office should do is exclusively a verification of the submission by the company of the documents required by the Trade Register Rules. The verification of the ,,file’’ (the set of standard declarations, supporting documents, and opinions) and the collection of the legal fees for authorization is an administrative act.’’

The same interpretation was conferred by the Commercial Court of Mures[2], that by substituting the ORCT Director, the court can only verify the fulfillment of necessary elements for the registration of trade acts and facts in the Trade Register. At the same time, it was decided that the court cannot exercise control over these acts substantial legality, but can only perform a formal legality control.

b) Following  Law No 265/2022 entry into force

Among the amendments brought by this law is the repeal of Article 37 of Law 31/1990, which established that the control of the legality of acts and facts recorded in the trade register was the responsibility of the delegated judge.

The procedure for registration by the trade register was regulated on the basis of the registrar’s control or on the basis of the court’s decision.

Thus, the status of the trade registrar was also regulated. According to Article 28, "The registrar is the legal specialist staff of the ONRC entrusted with the public service of legality control prior to registration in the Trade Register. (2) The Registrar resolves applications for registration in the trade register and other applications for registration in the trade register.''

Further, according to Article 3 para. (1) letter (b), ''registration'' means any registration operation in the trade register that includes:

1. the registration in the trade register of legal persons subject to this obligation by law;

2. the registration in the trade register of naturally authorized persons, individual undertakings, and family undertakings before the start of the business;

3. the registration in the trade register, before the start of the economic activity, of the branches of Romanian or foreign legal entities subject, according to the law, to this obligation;

4. the registration of entries in the trade register concerning the acts and facts for which the law provides this obligation, the registration of entries regarding the submission of documents, the registration of mentions concerning the submission of standard declarations on own responsibility concerning the fulfillment of the conditions for the functioning of the data contained therein;

5. the registration in the trade register of operations provided for by law, communicated by the competent public authority or institution;

Pursuant to Article 30 of Law No 265/2022, the Registrar is competent to examine applications for enrollment and other registration applications by the trade register, as well as the documents submitted in support of them, in order to ensure the applications legal compliance.

Thus, by repealing Article 37 of Law No 31/1990 and regulating the status of the Registrar, operated another transfer of competence to perform legality control. The delegated judge jurisdiction on the control of legality was expressly eliminated and so were the legal provisions concerning the control of legality exercised by the Director of the Trade Register Office provided by GEO no. 116/2009.

The importance of the Trade Register was also noted in the Explanatory Memorandum where it was mentioned that it is an essential component in the functioning of the business environment given that companies obtain legal personality by registration.

The Explanatory Memorandum also referred to the essential amendment to the registration procedure in 2009, which replaced the judicial control prior to registration with a control carried out by the Trade Registry Office.

Thus, from November 26th, 2022, the pre-registration control procedure will be carried out by the registrars, on the basis of documents.

The importance of this amendment resides in eliminating the possibility to submit motions to intervene in the registration procedure. However, the applicant and third parties have the right to file a complaint against the Registrar’s Resolution, after the registration procedure is concluded.

III. Conclusions

In conclusion, this new structure of competence for resolving registration applications by the trade register is intended to reduce the time required by law to complete the procedures.

It can also be noted that there is a tendency to simplify law formalities by renouncing certain stages with the entry into force of Law no. 265/2022 as well as the uniformity of registration procedures for all categories of natural and legal persons registered in the trade register.

MAXIM/ Associates

Av. Diana Fechete

21.11.2022

[1] Sebastian Bodu, Annotated and Annotated Company Law, 2017 Edition, Rosetti Publishing, p. 165,
[2] By Judgment No 32/2021 of March 26 th 2021