Forms of Doing Business in Moldova
What are the forms of doing business in Moldova?
Before starting a business and the process of company formation in Moldova, an entrepreneur must familiarize himself with the organizational and legal forms of entrepreneurial activity.
In accordance with national legislation of the Republic of Moldova, entrepreneurship activity can be established in the following organizational-legal forms:
a) sole proprietorship;
b) general (full liability) partnership;
c) limited partnerships;
d) joint-stock company;
e) limited liability companies;
f) production cooperative;
g) business cooperative;
h) lease enterprise;
i) state and municipal enterprise.
The individual enterprise (Sole proprietorship) is that one which belongs to the citizen under his rights of ownership or belongs to the members of his family on the basis of collective property. The patrimony of an enterprise is formed on the basis of citizen’s (family’s) property or from other resources which are not prohibited by Law.
An individual enterprise does not represent a juridical entity (person) and is performing legal activities as a physical person. The property of the individual enterprise is not separated from the property of the individual.
A general partnership (Collective association) represents an enterprise founded by two or more juridical and (or) physical persons, who put together their property with the view of jointly performing entrepreneurial activity under one firm on the basis of foundation (society) agreement between them.
The general partnership does not represent a juridical person (entity) and is performing legal activities as a physical person. For the obligations of the society all its participants bear unlimited solidary responsibility with all their property, except the property, which cannot be reprimanded under the legislation in force.
Limited partnership (Commandite association) represents an enterprise founded by two or more juridical and (or) physical persons, who put together their property with the view of collective entrepreneurial activity under one firm on the basis of foundation (society) agreement between them.
Limited partnership includes not less than one shareholder and one “commanditist”.
Limited partnership does not represent a juridical person and is performing legal activity as a physical person.
THE JOINT-STOCK COMPANY
A joint stock company is a business company, the authorized capital of which is divided into shares and whose obligations are secured by the property of the company.
A joint stock company is an enterprise created by two or more legal entities and (or) individuals who have combined their property to conduct joint business activities under a common firm on the basis of a constituent agreement between them.
A joint stock company may also be created by one individual or legal person.
The authorized capital of the company is divided into shares belonging to its members. The document certifying the right of the participants for his share represents – the stock.
A joint stock company is a legal entity and is liable for its obligations with all its property.
THE LIMITED LIABILITY COMPANY
A limited liability company is a business company, the authorized capital of which is divided into shares in accordance with the constituent document and whose obligations are secured by the property of the company. A limited liability company may also be established by one legal or natural person. At the same time, the number of participants cannot exceed 50.
LLC is a legal entity and is liable for its obligations with all its property.
The production cooperative is an enterprise founded by five or more individuals for the joint production and other economic activities, based mainly on personal labor of its members and cooperation of shares in the capital of the cooperative. Production cooperative is a private profit-making enterprise.
The production cooperative is legal entity and is liable for its obligations with own property.
The business cooperative is an enterprise founded by at least five legal entities and (or) individuals engaged in entrepreneurial activity, which is intended to contribute in the making profits for its members. By derogation from this provisions, members of the agricultural cooperative enterprise may be persons who produce agricultural products in personal subsidiary farms.
The business cooperative is legal entity and is liable for its obligations with own property.
Lease enterprise is the enterprise established by the members of staff of converted state (municipal) enterprises and their units (sub-units), re-organized with a view of performing of joint entrepreneurial activity under one firm on the basis of statutes and contract on the rent of state (municipal) property.
Lease enterprise is juridical persons and are responsible on their liabilities with the property of enterprise. The members of the enterprise bear the responsibility at the amount of their share in the property of enterprise.
STATE AND MUNICIPAL ENTERPRISE
The state enterprise is established and the property for it is distributed by the Government or authorized bodies of state governing.
The municipal enterprise is established and property for it is distributed by local self-administration authorities.
State and municipal enterprises are juridical persons and a liable with all the property of the enterprise.
The public administration authorities and local public administration authorities do not bear personal responsibility on the liability of the state and municipal enterprise. These enterprises do not bear responsibility on the liabilities of public administration authorities or local public administration authorities.
The above is intended to provide a brief guide only. It is essential that appropriate professional advice is obtained. Our office will be glad to assist you in this respect. Please do not hesitate to contact us.