Distribution agreement in Romania illustrated by contract papers, delivery parcels and a European market map on an office desk

Distribution Agreement in Romania: What Foreign Suppliers Should Negotiate

Commercial contracts · Foreign suppliers

A foreign supplier is ready to appoint a Romanian distributor. The commercial team has agreed a territory and a margin, but the draft contract still leaves open who owns the customer relationship, which online sales are permitted and what happens to inventory if the appointment ends.

In brief

A distribution agreement in Romania should define the distributor’s actual role, territory, sales channels, purchase commitments, supply and payment terms, brand use, product compliance and a workable exit. Exclusivity and online restrictions need a competition-law review under EU Regulation 2022/720, not a generic “Romania only” clause. The foreign supplier should also choose the governing law and forum expressly. Before signing, have the agreement, annexes and expected sales model reviewed together so commercial promises and contractual rights match.

This guide is for a supplier negotiating a business-to-business distribution arrangement for goods sold into Romania. It is a negotiation guide rather than a standard form. Regulated products, sector-specific networks and a contract involving a non-EU jurisdiction may require additional analysis. Where a purchase order, agency appointment or franchise arrangement is being labelled “distribution”, first identify what the parties will actually do.

What can Atrium review before you sign?

A defined review can compare the draft agreement with the territory plan, pricing model, order process and intended sales channels, then produce a negotiation mark-up and a short list of decisions for management. Send the current draft, annexes, product list and signing timetable when making the first enquiry. For recurring distributor or retailer contracts, we can also discuss whether an ongoing legal-support scope fits the expected workload.

Is this a distributor, an agent or a reseller under individual purchase orders?

The label is not enough. Ask who buys the goods, who invoices the Romanian customer, who bears stock and credit risk, and whether the local business may bind the foreign supplier.

A distributor generally purchases goods and resells them in its own name and for its own account. The commercial risk, margin and customer contract can sit with the distributor, although the supplier may still have product-related obligations. An intermediary who has continuing authority to negotiate or conclude sales on another party’s behalf may instead be a commercial agent. That distinction matters at exit: Directive 86/653/EEC and the Romanian Civil Code regulate the agency agreement in Articles 2072–2095, including the conditions for a post-termination indemnity under Article 2091. An Article 2091 termination indemnity is conditional, including on new customers or substantially increased business with existing customers, continuing substantial benefits for the principal and an equitable assessment. The indemnity is subject to a statutory maximum based on the average annual remuneration received by the agent during the relevant reference period; the amount payable is determined by the statutory conditions and the circumstances of the case, and is not automatically equal to one year’s remuneration. Those rules do not automatically give an independent distributor an equivalent statutory payment. If the parties only exchange separate purchase orders without an enduring market-development commitment, a supply framework may be the better description. The differences affect remuneration, customer data, liability and potentially the legal consequences of termination.

Do not assume that calling a contract “independent distribution” settles the classification. Review the actual authority granted to the local party, ownership of inventory, ability to negotiate price with customers, marketing commitments and risk of non-payment. The European Commission’s Guidelines on Vertical Restraints also distinguish genuine agency from independent distribution for competition analysis by looking at the agent’s relevant financial and commercial risks. A hybrid arrangement deserves close review before the parties adopt clauses copied from either model.

Distribution model selector

Choose the intended appointment to see the commercial decision and the competition-law question it creates.

Commercial question: What exactly is reserved: Romania, a customer category, a channel, or identified accounts? Agree measurable launch duties, resources and a review point before promising exclusivity.

Legal question: Article 4 of Regulation 2022/720 permits defined restrictions on active sales into an exclusively allocated territory or customer group under its conditions. A general restriction on passive sales, including unsolicited cross-border orders, is normally a hardcore restriction. Check the treatment of the distributor’s direct customers and any online rule separately.

What should the exclusivity clause actually cover?

Define the products, territory, customer groups, channels, reserved accounts and supplier’s direct-sales rights separately. “Exclusive in Romania” leaves too many commercial questions unanswered.

A foreign supplier may wish to retain existing multinational accounts, direct e-commerce, government tenders or sales to a particular industry. The distributor may expect protection for its investment in local staff, stock and marketing. Put those expectations into a schedule that names the protected customer category and the channels where the distributor is expected to invest. Clarify whether the supplier may appoint another distributor, whether an affiliate may sell directly and whether exclusivity is conditional on performance.

Sales restrictions require more than careful wording. Under Regulation (EU) 2022/720 on vertical agreements, the vertical block exemption (VBER) offers a conditional safe harbour. Among its conditions, the supplier and the buyer must each stay at or below 30% on the relevant market identified for that party, and the agreement must avoid the hardcore restrictions in Article 4. Crossing 30% does not itself make an agreement unlawful. Article 8(d) preserves the exemption for two consecutive calendar years after the year in which a party first exceeds 30%, where its share was initially no more than 30%; thereafter an individual assessment may be needed. An Article 4 hardcore restriction generally removes the benefit of the block exemption for the entire agreement, rather than just that clause. Loss of the exemption is not itself proof of an Article 101 TFEU infringement: the agreement and any possible individual exemption require a separate competition-law assessment. Article 4 contains distinct exceptions for exclusive, selective and other distribution systems. Under the Regulation, an exclusive territory or customer group may be allocated to the supplier itself or to no more than five buyers; a permitted active-sales restriction may in certain circumstances extend to the buyer’s direct customers. That does not create a general right to prohibit passive sales responding to unsolicited demand.

Link exclusivity to a realistic implementation plan. State when the distributor must launch, which products it must carry, what information it must report and what follows if an agreed target is missed. A shortfall might trigger a negotiated cure or conversion to non-exclusivity, if the contract so provides. Avoid a clause that promises permanent market protection while leaving the minimum effort, supplier stock availability and target measurement undefined.

Can the supplier control resale prices and online sales?

The distributor’s resale pricing and its ability to use the internet need a separate EU competition review. A target margin or brand policy does not justify fixing the distributor’s minimum resale price.

Article 4(a) of Regulation 2022/720 treats restrictions on the buyer’s ability to determine its sale price as a hardcore restriction for the block exemption. A supplier may set a maximum or recommend a resale price only if the arrangement does not operate as a fixed or minimum resale price through pressure or incentives. That means the clause, emails, discount approvals, monitoring and threatened consequences all matter. A “recommended” price list backed by penalties can create a different legal picture from a genuinely non-binding recommendation.

Online sales also need a clear channel map. Will the distributor run its own Romanian website, sell through marketplaces, advertise on search engines, or fulfil an order from a customer in another EU Member State? Article 4(e) addresses restrictions that prevent the effective use of the internet for selling the contract goods or services. A proportionate marketplace condition is not necessarily equivalent to an effective ban on internet selling; restrictions on the distributor’s own website, online advertising channels and cross-border passive sales must be examined separately. The effects and distribution model determine the analysis. State brand, service and presentation standards without copying an absolute online-sales ban.

If the supplier sells directly to Romanian customers as well as through the distributor, it should also examine its own distribution activities and any sensitive information exchanged with a downstream competitor. Under Article 2(5) VBER, the dual-distribution exemption does not cover an exchange of information unless it is directly related to implementing the vertical agreement and necessary to improve production or distribution of the contract goods or services. A competition assessment cannot be reduced to checking the distributor’s signature on a standard territorial appendix. Romanian Competition Law no. 21/1996 and the role of the Romanian Competition Council (Consiliul Concurenței) also matter; where trade between Member States may be affected, EU and national competition rules can be applied in parallel.

How long can a non-compete obligation last?

An exclusive appointment is not automatically the same as a non-compete obligation. Check whether the distributor is barred from competing products or required to source more than 80% of its relevant purchases from the supplier.

Under Article 5 of the VBER, a non-compete obligation of indefinite duration or more than five years is generally excluded from the block exemption. This is an exclusion of that obligation, not the same rule as an Article 4 hardcore restriction that removes the exemption for the entire agreement. The Commission’s Vertical Guidelines explain that a tacit renewal beyond five years can still benefit where the buyer can effectively renegotiate or terminate on reasonable notice and at reasonable cost, allowing it to switch supplier. There is also a limited exception for supplier-owned or qualifying supplier-leased premises. Do not state an automatic five-year ban without examining the arrangement.

A post-contract non-compete receives the block exemption only under narrower cumulative conditions, including a one-year limit, a restriction to the premises and land from which the buyer operated, and necessity to protect the supplier’s transferred know-how. Continuing confidentiality protection for non-public know-how is a separate question. Review these obligations with the exit plan rather than adding an unrestricted ban to the template.

Which commercial terms deserve the most negotiation time?

Price and territory are prominent, but the difficult disputes often come from the mechanics of ordering and performance. The table below turns a draft into a decision list. It is a negotiation tool, not a statement that every item is mandatory in every distribution relationship.

Foreign supplier negotiation map
DecisionDocuments and facts to reviewContract outcome to negotiate
Orders and forecastsForecast history, minimum order quantities, order acceptance and lead timesWhich forecast is binding, when an order becomes accepted and who carries shortage risk
Price and paymentPrice list, currency, tax assumptions, credit terms and rebate schedulePrice-change mechanism, invoice dispute route, credit limit and security if needed
Delivery and riskTransport model, agreed delivery term, warehouse and insurance arrangementsPlace of delivery, transfer of risk, inspection and short-delivery procedure
Market investmentLaunch plan, local team, promotional spend and performance dataMeasurable duties, reporting frequency and proportionate target review
Product and customer issuesInstructions, traceability, customer complaints and safety escalationWho investigates, notifies, preserves records and funds corrective action
Exit and stockAgreement duration, notice, unsold stock, open orders and brand assetsExit route, transition supply, inventory treatment, data and trademark handover

In particular, identify which document controls if a framework, quotation, purchase-order acknowledgement and distributor terms conflict. A list of “standard terms” attached after negotiations can reverse the agreed allocation of risk. Version the annexes and make the order of precedence deliberate. Where Romanian law governs, Article 1202(3) of the Civil Code gives individually negotiated clauses priority over standard clauses. Article 1203 may require express written acceptance of certain unusual standard clauses, depending on the circumstances. Applicable-law, arbitration and jurisdiction clauses must also satisfy the specific formal and substantive requirements of the applicable international, EU and national rules.

For payment terms, consider Law no. 72/2013 where it applies. Article 5(1) uses 60 calendar days as the general B2B maximum, subject to an expressly agreed longer term that is not abusive under the detailed provisions of the Law. Articles 3 and 4 address when late-payment interest accrues and the applicable statutory interest where no rate was agreed. Discuss credit limits, advance payment, a bank guarantee or a carefully documented retention-of-title arrangement when the distributor carries substantial stock. A retention-of-title clause needs a separate review of identification, applicable property and security rules, third-party effect and insolvency exposure. Check the chosen law and cross-border enforceability before relying on a form clause.

Who handles product compliance, complaints and recalls?

Allocate operational tasks in the agreement, but first establish each party’s legal role in the supply chain. A contract cannot remove duties imposed directly by applicable product law.

For consumer products within its scope, Regulation (EU) 2023/988 on general product safety, applicable from 13 December 2024, imposes obligations on manufacturers, importers and distributors. A Romanian business established in the EU that places a product from a third country on the EU market may be an importer even if the commercial agreement calls it a distributor; simply reselling goods already placed on that market does not automatically give it that role. Whether the Romanian business is an importer depends on the applicable definition and the actual supply-chain arrangements, including who places the product on the Union market and who is identified in the relevant import and compliance documentation. A business that markets a product under its own name or trademark, or substantially modifies it, may assume manufacturer obligations. Article 16 requires an economic operator established in the EU to be responsible for specified tasks for products covered by the Regulation. Products intended exclusively for professional or industrial use require their own regulatory assessment, but goods reasonably foreseeable for consumer use can fall within the GPSR even if also sold to professionals. Sector-specific legislation may also apply. The contract should identify the entity responsible for relevant product documentation, language of instructions, traceability, handling a safety alert, notifying the other side and contacting authorities when legally required.

The distributor needs a reliable path to escalate complaints and stop affected stock from moving while facts are checked. The supplier needs batch, shipment and customer information sufficient to trace affected products, subject to the applicable law and the information actually held by the parties. Agree who controls consumer-facing statements and who pays for transport, inspection, replacement or a recall when responsibility is established. Financial indemnities and insurance should be tested against the actual legal roles and the available cover, not inserted as a blanket promise that one party will absorb every event.

For non-safety complaints, specify the first response owner, the evidence record and the approval path for customer communications. If the Romanian seller is approached by ANPC or a competent sector-specific market-surveillance authority, the contract should support prompt access to product and transaction records and identify who coordinates any legally required notification or corrective measure. If an actual contravention report is issued, our guide to challenging an ANPC fine addresses that separate sanction stage.

How should the contract handle the brand and customer information?

A distributor needs permission to present the products, but that does not require ownership of the supplier’s trademark or unrestricted use of brand assets. Specify permitted marks, approved materials, translations, domain names, social accounts, quality controls and who may register or renew a local domain. Prohibit registration of the supplier’s trademark in the distributor’s own name without express consent, and agree how control of local domains and accounts is transferred at exit. Describe what happens to signs, listings and marketing assets on termination. A local distributor should not be left with an unclear right to keep using a supplier’s mark after the appointment ends.

Customer data deserves its own practical map. If each business decides independently why and how it processes personal data, an automatic “processor” label is unreliable. If one party processes information on the other’s documented instructions, a data-processing agreement may be required under Article 28 of the GDPR. If the parties jointly determine purposes and means, Article 26 may require a joint-controller arrangement instead. Transfers of personal data to a country outside the EEA require a separate Chapter V analysis where applicable. Determine which company collects the customer’s details, who sends marketing, who keeps complaint and warranty records, whether information crosses borders and what may be transferred at exit. The site’s data-processing agreement guide covers the role distinction in more detail.

A customer list is also a commercial asset. Define access to leads generated by the supplier and those developed by the distributor, and the rights to use them after termination. This needs to fit competition, confidentiality, data-protection and actual customer-contract arrangements. A contractual claim to “own all Romanian customers” is too crude to answer any of those questions.

What must be agreed about duration and exit?

State the term, renewal process, notice route, breach remedies and the fate of accepted orders and inventory. The supplier’s right to appoint someone else after exit is only useful if the transition can be carried out in practice.

A fixed term may support launch investment, but management should see the renewal and break points on a calendar. An indefinite-term arrangement requires a different notice analysis. Under Article 1277 of the Romanian Civil Code, either party may unilaterally end an indefinite-term contract with reasonable notice. Reasonableness depends on the relationship, its duration, investment, replacement arrangements and the practical transition; there is no universal 30-day rule. Article 1277 treats a contrary clause, or a payment required merely in exchange for exercising that withdrawal right, as unwritten. This does not erase accrued invoices, accepted orders or liability for a separate breach. Article 1276 regulates the exercise of a contractual or statutory right of unilateral withdrawal (denunțare unilaterală) where such a right exists; it does not give either party a general right to abandon a fixed-term contract.

The contract should also say what constitutes a serious breach, whether a cure opportunity applies, where notices must be sent and when they are effective. Under Romanian law, breach-based termination (reziliere) and its notice mechanics should be distinguished from unilateral withdrawal; Articles 1550–1553 of the Civil Code address available routes and express termination clauses (pacte comisorii). An Article 1553 clause should identify the obligations whose non-performance triggers termination and should state whether termination operates automatically or requires notice, subject to the Civil Code and the wording of the clause. Rights must be exercised in good faith under Articles 15 and 1170. A negotiated penalty or damages clause needs its own assessment rather than being treated as a fee for exercising Article 1277. The supplier should plan for accepted orders, returns, spare parts, warranties, prepaid promotions, demonstration stock, tooling, customer communications and the removal of its branding. The distributor may need an orderly stock solution rather than an abrupt write-off; the supplier may need protection against damaged or obsolete inventory being returned at full price.

An independent distributor has no automatic Romanian statutory goodwill indemnity equivalent to the agency indemnity in Article 2091. A genuine agency relationship may engage that rule only if its conditions are met, subject to its statutory cap; an “independent distributor” label will not resolve a different factual arrangement. The parties may negotiate stock buy-back, transition payments or other exit arrangements expressly; a separate claim based on breach or abusive exercise of rights depends on its own facts and legal basis. The classification and governing law require a document-specific assessment. Our separate supplier contract exit guide explains early termination routes after a relationship is already underway.

Which law and court will govern a cross-border dispute?

Choose governing law and the dispute forum deliberately. Under Rome I Regulation, Article 3, the parties can generally choose the law applicable to contractual obligations. If they make no effective choice, Article 4(1)(f) provides a specific connecting rule for a distribution contract: the law of the country of the distributor’s habitual residence. For a company, Article 19 generally locates habitual residence at its central administration, with a branch-related rule in specified cases; classification and Article 4(3) may displace the default if the contract is manifestly more closely connected with another country. Rome I also preserves the role of overriding mandatory provisions in Article 9 and, in the intra-EU circumstances covered by Article 3(4), EU rules that cannot be derogated from. A Romanian distributor may therefore bring Romanian law into the analysis even when the supplier’s template assumes its home law will apply by default.

The chosen law does not by itself decide which court hears a dispute. An EU cross-border jurisdiction clause should be assessed under Regulation (EU) 1215/2012, including Article 25 where applicable. A jurisdiction agreement must meet Article 25’s consent and form requirements, which include writing or an equivalent electronic communication providing a durable record. Article 25 does not require a general factual connection between the selected Member State court and the parties. Exclusive jurisdiction rules and other applicable limits still require checking. Without an effective choice, Article 7(1)(b) may be relevant to the place of performance; the Court of Justice’s Corman-Collins judgment (C-9/12) treated a distribution arrangement involving characteristic distribution obligations as a supply of services for the predecessor rule. That classification depends on characteristic obligations in the actual agreement; the place of performance must be established on its facts. Arbitration has a different framework. Consider where the distributor’s assets and records are, where performance occurs, language and evidence costs, and how a judgment or award would be enforced. The choice of foreign law cannot simply switch off overriding mandatory rules or EU competition provisions that apply to conduct in the market.

Representative Experience: Appointing a Distributor in Romania

The commercial situation

A European manufacturer planned to appoint a Romanian distributor for a new product line. The supplier wanted the distributor to invest in local sales and stock, while retaining the ability to serve existing multinational customers directly. The draft agreement described the appointment as “exclusive in Romania” but did not clearly define reserved accounts, online channels, sales targets or the treatment of unsold inventory at exit.

Atrium’s work

Atrium reviewed the intended sales model alongside the contract wording. Our lawyers worked on the definition of the protected territory and customer groups, reviewed the proposed sales restrictions under EU competition rules, aligned purchase commitments with supply capacity and clarified responsibilities for product information, customer complaints and brand use. The revised exit provisions addressed accepted orders, remaining stock, notice and the handover of local marketing assets.

The practical result

The supplier received a revised negotiation draft and a short decision list identifying the points management needed to settle with the distributor. The work gave the parties a clearer basis for negotiating the appointment and planning its implementation.

The client’s identity is omitted. This summary describes one matter and does not imply that another engagement will have the same outcome.

When does monthly legal support make sense?

A single distribution appointment may be handled as a defined drafting or review matter. Ongoing counsel is more useful where the supplier repeatedly appoints dealers, changes pricing and marketing programmes, adds product lines, reviews exclusivity targets or manages several customer and compliance escalations in Romania. The recurring work might include contract amendments, order-term consistency, brand-use approvals and a response process for product complaints. It should have a named business owner and an agreed scope, not an assumption that every dispute and authority proceeding is included.

Atrium’s monthly legal support for companies can be discussed once the expected volume and type of work are clear. The first step remains the concrete contract in front of management. It can reveal whether the business needs one negotiated agreement, a reusable set of distributor terms or continuing assistance across several relationships.

What should management send for a first review?

Start with a short description of the products, the intended Romanian territory and the proposed local partner. Attach or identify the current agreement and annexes, price and rebate schedule, distribution plan, product-compliance documents available for review and any existing customer or online-channel commitments. Note the proposed signing date and the issues that are still disputed. If some files are confidential or too large for the initial enquiry, describe them first and agree a suitable transfer route.

A lawyer’s first review can then identify whether the appointment is really distribution, map mandatory and negotiable issues, mark clauses that conflict with the commercial model and identify a small number of decisions for the supplier. The work product may be a clause mark-up, a negotiation matrix and an implementation note on notices, sales-channel controls and product responsibilities. This is a scope to agree, not a promise about the distributor’s acceptance or the outcome of negotiations.

Related Guides

Frequently asked questions

Can a foreign supplier appoint one exclusive distributor for Romania?

Potentially, but the appointment needs precise scope and a competition review. Identify the products, territory, customer groups, direct-sales exceptions, distributor obligations and exit conditions. Regulation 2022/720 contains conditions and exceptions for exclusive distribution; it does not approve every restriction on sales into or out of Romania.

Can the supplier impose a minimum resale price?

A restriction on the distributor’s ability to set its resale price is a hardcore restriction for the VBER. A maximum or recommended price is treated differently only if it does not become a fixed or minimum price through pressure or incentives. Review the actual pricing practice as well as the wording of the contract.

Does a distribution agreement need to be governed by Romanian law?

The parties can generally choose the contract law under Rome I. Without an effective choice, Article 4(1)(f) points to the distributor’s habitual residence for a distribution contract, subject to classification and exceptions. A foreign-law clause does not by itself exclude overriding mandatory rules or applicable EU competition law.

Can the supplier prevent the distributor from selling online?

An absolute online-sales prohibition can be problematic under Article 4(e) of Regulation 2022/720. Some quality or channel restrictions may be possible, depending on their content, effect and distribution system. Map the website, marketplaces and advertising channels, then assess the proposed rule rather than relying on a standard ban.

What happens to unsold stock when the appointment ends?

Start with the contract, accepted purchase orders and applicable law. Agree in advance whether stock may be sold for a limited period, bought back under defined conditions or otherwise handled, with rules for damaged, obsolete and promotional goods. Address customer claims, warranties and brand removal at the same time.

Review the Romanian appointment before signing

Tell us who will sell to the Romanian customer, the proposed territory, whether exclusivity or online restrictions are requested, and when the contract needs to be signed. Atrium can discuss a defined negotiation review. If your group expects recurring distributor agreements or product and sales-channel questions, mention the expected workload so we can discuss an appropriate ongoing scope.

Disclaimer: This page provides general information only and does not constitute legal advice, a legal opinion or the creation of a lawyer-client relationship. Legal solutions depend on the specific facts and documents involved.

AI Notice: AI-assisted content. Legal information should be checked against the current law and the specific facts before reliance.

Geometric maze illustrating contractual risk assessment during a contract review in Romania

Contract Review in Romania: 12 Clauses to Check

Which contract clauses should a business check before signing?

A Romanian business contract should clearly allocate performance, payment, liability, intellectual-property, data and exit risks. These 12 clauses are the practical starting point for a legal and commercial review.

Contract review in Romania should test more than whether an agreement is formally valid. Before signing, a business should understand what it must deliver, when it will be paid, which losses it may bear, how intellectual property and data may be used, and how the relationship can end.

Commercial contracts are often negotiated under pressure. A supplier is ready to begin, a customer wants the final draft immediately, or a foreign group needs its Romanian operation running without delay. That is precisely when unclear wording, inconsistent annexes and borrowed template clauses are most likely to pass unnoticed. Companies entering the market should connect the contract with the wider steps required to start and operate a business in Romania.

Interconnected architectural structure illustrating how contract clauses work together in a Romanian contract review
A well-structured contract depends on interconnected clauses that allocate obligations, remedies and commercial risks consistently.

Under the Romanian Civil Code, a validly concluded contract is binding on the parties, and contractual negotiations and performance are governed by good faith. A useful review therefore connects the legal wording with the operational deal. It identifies which party controls each risk, whether the agreed remedy can work in practice, and what evidence will be needed if performance is disputed.

The following 12 clauses form a practical checklist for Romanian companies and foreign businesses entering agreements governed by Romanian law or involving a Romanian counterparty.

Parties, capacity and signing authority

The contract should identify the correct legal entities, not merely the brand names used in negotiations. For a Romanian company, check its registered name, registered office, Trade Registry number, fiscal identification code and representative. If a group is involved, establish which entity receives the services, issues invoices, owns the relevant assets and assumes liability.

Signing authority should be verified against the company’s constitutional documents, Trade Registry information, corporate approvals or a power of attorney. A signature block describing someone as a “manager” does not itself resolve whether that person may bind the company for the relevant transaction. The representation rules should be checked against the company’s current Romanian articles of incorporation and the registered powers of its administrators.

The internal authority analysis also matters for potential Romanian company director liability, particularly where a director signs outside approved limits or fails to document a material commercial decision.

Check before signingConfirm the contracting entity, the signatory’s authority, any required corporate approval, the position of affiliates and whether subcontracting or assignment to another group company is permitted.

Scope, deliverables and acceptance

The scope clause should describe the goods or services, specifications, quantities, locations, deadlines, dependencies and exclusions. For project work, it should also establish milestones, acceptance tests, correction periods and a change-control procedure.

Review the main agreement together with proposals, statements of work, order forms and technical annexes. If they conflict, an order-of-precedence clause should determine which document controls. Acceptance by silence should also be tested carefully: specify when the review period begins, what constitutes a valid rejection and what happens when defects are minor. Providers using standard customer documentation should also verify the applicable service contract requirements in Romania.

Common riskThe commercial proposal promises one result, the technical annex describes another and the general conditions allow the supplier to treat delivery as accepted before meaningful testing has taken place.

Price, VAT, invoicing and payment

A complete payment clause states the price or calculation method, currency, VAT treatment, invoicing trigger, payment deadline, supporting documents, bank charges and the procedure for disputing an invoice. It should also explain whether the customer may withhold, deduct or set off amounts and whether the supplier may suspend performance for non-payment.

For B2B transactions, Law no. 72/2013 on late payment contains mandatory protections. Article 5(1) establishes a general 60-calendar-day limit for contractual payment terms between professionals. By exception, the parties may agree a longer payment term, provided that the clause is not abusive under Article 12. A term exceeding 60 days is therefore not automatically invalid, but it should be assessed carefully for gross unfairness to the creditor in light of the statutory criteria and the circumstances of the transaction. Where the applicable conditions are met, late payment can trigger statutory penalty interest and the fixed EUR 40 recovery compensation.

For the calculation rules and available remedies, see our guide to late-payment interest and penalties in Romania.

Term, renewal and minimum commitments

The agreement should state its effective date, initial duration and whether it renews automatically. An automatic renewal clause is not necessarily problematic, but the notice window, notice method and effect of a missed deadline must be clear.

Check minimum purchase commitments, exclusivity, take-or-pay obligations and price changes that continue into a renewal term. Add internal calendar reminders for any deadline that determines whether the company remains bound for another year or loses a renegotiation opportunity.

Check before signingIdentify the earliest exit date, the last date for a non-renewal notice and every financial or operational commitment that survives renewal.

Termination, cure periods and exit assistance

The termination clause should distinguish between serious breach, remediable breach, insolvency-related events, prolonged force majeure and termination for convenience. It should specify whether prior notice is required, how long the defaulting party has to cure, and whether termination operates through a contractual mechanism or requires another legal step.

The Romanian Civil Code regulates remedies for non-performance, including termination under Article 1549 and the related provisions. The contract should not merely say that a party “may terminate immediately”. It should align the grounds, notice mechanics and agreed effects with the type of contract and the intended remedy.

Exit provisions matter just as much as the termination trigger. Address final invoices, transition assistance, return of equipment and documents, data export, deletion, continued licences and the clauses that survive termination.

Penalty clauses and late-payment interest

A penalty clause fixes in advance the consequence of non-performance, defective performance or delay. Under Article 1538 of the Romanian Civil Code, its drafting should identify the protected obligation, the triggering event and the calculation method. The agreement should also state whether a penalty is daily or fixed, whether it is capped and how it interacts with damages and other remedies.

Article 1541 permits a court to reduce a penalty in the statutory circumstances, including where it is manifestly excessive in relation to the loss that the parties could have foreseen when concluding the contract. A high percentage is therefore not a substitute for careful drafting.

Common riskA daily penalty has no cap, applies to several overlapping obligations and continues after termination, creating exposure far beyond the economic value of the contract.

Liability caps, exclusions and indemnities

Liability provisions should allocate risk in proportion to the contract’s value, the parties’ control and the available insurance. Review the general cap, any separate or higher caps, excluded categories of loss, claims procedures and responsibility for employees, affiliates and subcontractors.

Do not assume that an indemnity is a familiar standard clause. It should identify the covered events, third-party claims, control of the defence, settlement authority, notification duties and mitigation. Check whether the limitation of liability applies to the indemnity or whether it creates uncapped exposure.

Any exclusion or limitation must also be tested against mandatory law and the nature of the conduct involved. A clause should not be described as protecting a party against every possible form of unlawful conduct. Where the agreement supports a wider investment or group operation, the liability wording should be reviewed together with the company’s corporate and commercial governance arrangements.

Warranties, regulatory compliance and audit rights

Warranties should be specific to the transaction. Depending on the contract, they may cover conformity with specifications, professional licences, legal compliance, authority, sanctions, anti-bribery, tax status, employment practices, product safety or the absence of third-party rights.

The review should also establish the remedy for an inaccurate warranty. Possible outcomes include correction, replacement, a price adjustment, indemnification or termination. An audit right should define scope, frequency, confidentiality, cost allocation and the treatment of identified non-compliance.

Drafting pointA broad promise to comply with “all applicable laws” may be necessary, but it does not replace transaction-specific duties, evidence requirements and an agreed remediation process.

Force majeure, hardship and change in law

Force majeure and hardship solve different problems. Force majeure concerns an external, unforeseeable, absolutely invincible and unavoidable event under the Civil Code framework. Hardship under Article 1271 addresses an exceptional change that makes performance excessively onerous, subject to the statutory conditions and the allocation of contractual risk.

The clause should define notice, evidence, mitigation, suspension, continued payment obligations and the point at which prolonged disruption permits termination. For regulated or long-term projects, add a change-in-law mechanism explaining who bears new compliance costs and whether price or timing may be adjusted.

Check before signingDo not treat every supplier delay, price increase, staff shortage or market change as force majeure. The clause should distinguish ordinary commercial risk from qualifying events.

Confidentiality and intellectual property

A confidentiality clause should define protected information, permitted use, internal access, legally required disclosures, security standards, duration and return or destruction. Trade-secret protection also depends on practical steps, so access controls and marking procedures should match the contractual wording. A standalone non-disclosure agreement in Romania may be appropriate before sensitive negotiations begin.

For intellectual property, distinguish pre-existing materials from deliverables created under the contract. State whether rights are assigned or licensed and address territory, duration, field of use, sublicensing, modifications, source materials and third-party components.

Romanian Law no. 8/1996 on copyright requires an assignment of economic copyright to specify the transferred rights and, for each, the modes of use, duration, extent and remuneration. A generic sentence stating that the customer “owns everything” may therefore be insufficient for the intended result. Businesses acquiring or licensing valuable assets can obtain a separate review from intellectual property lawyers in Romania.

For ownership arrangements between founders and shareholders, see our guide to shareholder agreements in Romania.

Personal data, security and digital services

If the agreement involves personal data, identify whether each party acts as controller, processor, joint controller or independent controller. When a supplier processes personal data on behalf of a controller, Article 28 of the General Data Protection Regulation requires a contract containing specified safeguards. Our GDPR compliance checklist for Romanian companies explains the wider governance controls that should support those clauses.

Review processing instructions, confidentiality, security measures, subprocessors, assistance with data-subject requests, breach notification, international transfers, audit rights and return or deletion. The commercial agreement and data processing agreement should not contain inconsistent liability, notice or termination rules. More complex vendor arrangements may require assistance from GDPR and data protection lawyers in Romania.

For SaaS and other digital services, also check availability commitments, backups, recovery objectives, vulnerability management, incident cooperation, data portability and access after termination. Technology businesses should align these provisions with their wider technology and digital law obligations and, where relevant, obtain a focused IT and software contract review.

Governing law, jurisdiction and notices

In cross-border contracts, governing law and forum are separate questions. The Rome I Regulation generally allows the parties to choose the law governing their contractual obligations, subject to its safeguards and mandatory rules. The Brussels I bis Regulation governs jurisdiction and the recognition and enforcement of judgments in relevant EU civil and commercial matters.

Consider whether the selected court or arbitral tribunal is proportionate to the likely dispute, where evidence and assets are located, the language and cost of proceedings, and whether an eventual judgment or award can be enforced efficiently.

The notice clause should identify valid addresses, permitted delivery methods, deemed receipt and the process for updating contact details. A termination or claim notice sent to the commercial contact may fail if the contract requires delivery to a different address or by a specific method. Where non-payment is already a concern, the agreement should be tested against the available legal recovery options for unpaid invoices in Romania.

Contract review in Romania: risk map

Contract areaQuestion to answerRisk if unclear
AuthorityIs the correct entity bound by an authorised person?Enforceability, approval and group-liability disputes.
PerformanceWhat exactly must be delivered, tested and accepted?Disputes over completion, defects and payment.
PaymentWhen is money due and what follows from delay?Cash-flow loss, penalties and invoice disputes.
ExitHow can the relationship end and what survives?Lock-in, service interruption and lost data.
LiabilityWhich losses are covered, capped or excluded?Exposure disproportionate to contract value.
IP and dataWho owns or may use assets, information and data?Loss of rights, GDPR exposure and operational dependency.
DisputesWhich law, forum and notice rules apply?Unexpected cost and difficult enforcement.

A practical pre-signing review process

Confirm the commercial dealRecord the intended result, price, timeline and points already agreed before editing legal language.
Read every contract documentReview the agreement, annexes, order forms, proposals, policies and incorporated online terms together.
Rank the risksSeparate legal defects, high-value commercial exposure, operational ambiguity and points that are negotiable preferences.
Propose usable wordingConvert each material issue into a replacement clause, tracked change or clear negotiation question.
Check signing and evidenceConfirm authority, approvals, signature method, final attachments and preservation of the executed version.
Calendar post-signing dutiesTrack notices, renewals, price reviews, certificates, audits and delivery or payment milestones.

Need a Romanian contract reviewed before signing?

Atrium Romanian Lawyers assists Romanian and foreign businesses with contract review, drafting and negotiation. The review can be delivered as tracked changes, replacement clauses, a consolidated draft or a practical risk report adapted to your position in the transaction.

Frequently asked questions

Is a business contract written in English valid in Romania?

Romanian companies can generally conclude commercial contracts in English. The transaction may nevertheless require Romanian-language documents or translations for authorities, courts, employees, consumers, notaries or regulated formalities. The governing-language clause should state which version prevails if the contract is bilingual.

Can a foreign-law contract be used with a Romanian company?

Potentially, yes. In a cross-border contract, the parties may often choose the governing law, but the Rome I framework, mandatory rules, the place of performance and the practical enforcement route must be considered. Choosing foreign law does not automatically remove every Romanian mandatory provision relevant to the transaction.

Are contractual penalties enforceable in Romania?

Romanian law recognises penalty clauses, but the obligation, trigger and calculation must be clear. Article 1541 of the Civil Code permits judicial reduction in the statutory circumstances, including a penalty that is manifestly excessive compared with the foreseeable loss at contract formation.

When should contract review in Romania take place?

Ideally before signing and before the commercial position becomes difficult to change. A new review is also appropriate before renewal, when the scope or price changes, when a party proposes an amendment, or when performance problems and a possible dispute emerge.

What should a foreign company send to the reviewing lawyer?

Send the complete draft and annexes, the commercial proposal, your role in the transaction, the applicable deadline, the principal business concerns and any terms already agreed. Identifying whether you are the customer, supplier, licensor, employer, investor or distributor changes the risk analysis.

Disclaimer: This article provides general legal information and does not constitute legal, tax or commercial advice. Contractual rights and risks depend on the complete document, the transaction, the parties, mandatory rules and the relevant facts.

AI Notice: AI-assisted content, reviewed and approved by a qualified Romanian lawyer.