CONDITIONS GOVERNING THE EXERCISE OF
COMMERCIAL ACTIVITIES BY PROFESSIONALS
Mihaela Narcisa Stoicu
Vasile Goldis Western University Arad, Faculty of Law
Abstract
The Romanian Constitution establishes that market economy in Romania is based on private property and is developed under the law of supply and demand. As such, the State has the obligation to ensure freedom of trade, protection of fair competition and to create an appropriate framework for the use of all factors of production. The Constitution also provides that the choice of profession should be free, and that the exercise of this freedom may be limited "only by law", with regard to the right to work.
The operative principle in relation to commercial activities is the freedom of trade, according to which anyone is free to exercise a commercial profession, provided they respect the limitations and the special conditions prescribed by law.
As regards the conditions governing the exercise of commercial activities, the law establishes certain conditions on the capacity of individuals to conduct economic activities, also establishing certain incapacities, as well as incompatibilities, forfeitures and bans on making trade.
The law sets specific conditions regarding the capacity of individuals to conduct commercial professional activities, but it also establishes some incapacities to provide shelter from adverse consequences to some persons.
Keywords:Romanian Constitution; commercial activities; individual professionals;
Capacity required for individuals to be professionals:
The individual professional is subject to the general provisions of the Civil Code on the ability to conclude legal documents, as the new Civil Code enshrines a unitary regulation of private legal relations.
Consequently, the individual professional will be able to conclude professional legal documents on their own right, only after having acquired full capacity of exercise. Full capacity of exercise for the individual professional will be acquired upon reaching the age of 18, thus establishing the absolute presumption of existence of judgment upon coming of age. It is therefore considered that the individual professional already has the judgment required to conclude any legal document allowed by law after reaching the minimal age.
Both the minor under 14, who is devoid of the capacity of exercise, and the minor who has reached the age of 14 and has a limited capacity of exercise are subject to the incapacity to be professionals.
The situation when the minor has turned 16 has been a difficult issue for practitioners, as in accordance with the law, they are able to conclude a contract of employment or be a member in a cooperative organization, without the need for approval from parents or legal guardians. The solution found to solve this problem is that, given the specificity of commercial activities, in principle, 16 year-old minors are not able to be themselves professionals.
As regards married minors, it has been questioned whether or not they have professional capacity after marriage. This situation came to the attention of practitioners since the new Civil Code allows, for good reasons, marriage for minors who have reached the age of 16 and because, by marriage, such minors virtually acquire full capacity of exercise. Prior to the entry into force of the new Civil Code, the prevalent opinion regarding the married minor and the capacity of exercise was that, in the absence of express legal provisions, the married minor would not have the capacity required to acquire individual professional status. Thus, in the context of a uniform regulation of civil and commercial legal relations, that opinion is no longer justified, the result being that, under the current regulation, by anticipated acquisition of the full capacity of exercise, the married minor also acquires the capacity to conduct activities of a professional nature.
The acquisition of full capacity of exercise before reaching the age of 18 is also possible in another situation than that of the married minor. The new Civil Code provides, as part of the novelty stipulations of its art. 40, a situation in which, for good reasons, the guardianship court can recognize the minor who has reached the age of 16 years without being married as having full capacity of exercise.
The rule according to which acquiring the capacity to become a professional is strictly related to the acquisition of full capacity of exercise also has an exception, expressly provided in G.E.O. no. 44/2008, which provides that an sole proprietor and a freelance professional must be at least 18 of age, but family businesses may include members who have reached the age of 16.
A legally incapacitated person cannot be a professional because such a person lacks the capacity of exercise, which is justified by the lack of judgment required to care for their interests, due to the alienation or mental debilitation they suffer from.
Such persons are devoid of the capacity to conclude such legal documents. The legal representation of incapacitated persons is needed in order to not exclude them from legal life, enabling them to be subjects of law, but not professionals.
Commercial activities cannot be exercised due to the following restrictions:
A. Prohibitions
The exercise of certain commercial activities is subject to prohibitions aiming to protect the general interests of society. Here we consider certain activities that cannot be carried out based on free enterprise. These activities may not be pursued in any companies, and include: manufacturing and marketing of drugs and narcotics, military equipment, weapons and ammunition, activities that are offenses under the criminal law, state monopoly etc.
Any violation of the law regarding the organization and performance of economic activities based on free initiative is punishable by law.
2. Incompatibilities
The speculative character of commercial activities is assigned to it by definition, as this activity is aimed at obtaining profit. Thus, commercial activities cannot be exercised by individuals who have certain positions or professions related to guarding society interests. The importance of establishing these incompatibilities is given by the need for securing the dignity and integrity of that position or profession.
By Law no. 188/1999 on the status of civil servants, incompatibilities are set regarding the positions that may not be held by them. Civil servants may not hold positions in autonomous administrations, in companies or other for-profit organizations. Also, they may not, either personally or as agents of other people, carry out, within private companies, activities related to civil service they perform.
As regards those exercising liberal professions such as lawyers, notaries public, physicians, architects, psychologists, etc, incompatibility was established with conducting commercial activities.
The Romanian Constitution provides some incompatibilities regarding a judge’s position, which is incompatible with any other public or private position, except for professorships in higher education. As for prosecutors and judges of the Constitutional Court, the Constitution provides the same incompatibilities, identical to those for judges.
Commercial professions are also prohibited for officers or diplomats, as this measure is aimed at ensuring integrity and defending professional principles.
The positions of deputy, senator, Government member, public servant or local authority are incompatible with that of an individual trader.
3. Forfeitures
Laws regarding public order and morality must be observed by professionals while performing their work.
Incompatibility does not prevent the trader from becoming a commercial professional.
Law no. 12/1990 on the protection of population against illegal commercial activities provides the deeds constituting illicit commercial activities, as well and the contraventional or criminal sanctions for committing such deeds.
Due do the need to ensure the legality and morality of commercial activities, it is required that, if professionals commit serious offenses, they forfeit the right to perform certain commercial activities.
The penalty of forfeiture of thetrader’sright to exercise acts of commerce is not expressly provided in Law. 12/1990, although the latter does establish some criminal penalties for illicit acts committed by the commercial professional. However, corroborating Law no. 12/1990 with Law no. 26/1990 on the Trade Register and the common-law provisions of the Criminal Code, in practice it is considered that, if the commercial professional has committed illegal acts related to commercial activity, the court may order the penalty of forfeiture of the right to exercise a commercial profession, as an additional penalty under the Criminal Code.
It is important to note the necessity for the criminal sentence to expressly provide, in addition to the main penalty to which person was convicted, also the forfeiture of their right to exercise a commercial profession, as the simple criminal conviction of a person does not automatically entail their indignity as a commercial professional.
4. Approvals and agreements
There are situations when performing commercial activities is conditioned by the existence of approvals or agreements. These situations include certain activities that may be pursued by companies only with the prior consent of competent bodies in that field, such as in radio communications, manufacturing and marketing of interception equipment etc.
The application for registration in the Trade Register and for the operating permit shall be submitted to the Trade Register attached to the County Court under the jurisdiction of which the applicant establishes their professional office, and will be accompanied by documentation provided in the appendix, which is an integral part of the Emergency Ordinance no. 44/2008.
Registration of the freelancer, sole proprietorship and family business in the Trade Register is based on the substantiated resolution of the Director of the Trade Register Office attached to the tribunal.
If they deem the conditions of art. 8 and 9 of Emergency Ordinance no. 44/2008 to have been fulfilled, the Director of the Trade Register attached to the tribunal shall order registration in the Trade Register and provide an operating permit for the freelancer, the sole proprietorship and family business. The same resolution will also order the registration of the statutory declaration regarding the conformity of submitted data with Law no. 359/2004, as amended and supplemented.
Complaints can be filed against the resolution of the Director of the Trade Registry Office attached to the tribunal, within 15 days of its delivery or communication, as appropriate. The complaint is filed with the court within the jurisdiction of which the applicant’s professional office is located, and judged under the conditions of common law.
The application of resolutions made by the Director of the Trade Register Office attached to the tribunal, regarding registration and any other records in the Trade Register, shall not be suspended during the trial. Applications to courts are exempt from judicial tax and stamp fees.
Failure to comply with legal requirements regarding the approval of competent bodies results in the nullity of the company contract.
The law also sets specific restrictions on the exercise of commercial activities for people who perform acts of trade on behalf of another or are associates to a company. Such restrictions apply to officials in charge when they cannot exercise trade on their own in the same branch of trade where they fulfill their task. Another such restriction is found in the case of associations within general partnerships or limited partnerships, which cannot participate as unlimited liability partners in rival companies.
The lack of consent by authorized persons / bodies in this sense does not affect the validity of commercial acts performed in violation of law, but an official in charge or associate owes compensation for damage caused by their behavior.
References
Gh Beleiu, Romanian Civil Law, Universul Juridic Publishing House, 2011, p. 73.
I.N. Finţ escu,Commercial Law Course, vol. I, Soccec Publishing House, 1929, p. 92.
M. Muresan, S. Fildan, Civil Law. The Persons, Cordial Lex Publishing House, 2011, p. 109.
E. Poenaru,Civil Law. General Theory. The Persons, All Beck Publishing House, 2002, p. 273
C. Mitrache, Romanian Criminal Law. General part, “Sansa” Ltd. Publishing House, 1994, p. 218.
Emergency Ordinance no. 44/2008 on economic activities performed by freelance professionals, sole proprietorships and family businesses.
Law no. 161/2003, published in the Official Gazette of Romania no. 279, on measures to ensure transparency in the exercise of public dignities, public positions and businesses, preventing and sanctioning corruption, with the subsequent amendments and additions brought by the Emergency Ordinance no. 40/2003; Law no. 114/2004; Law no. 171/2004; Law no. 280/2004; Law no. 359/2004; Emergency Ordinance no. 92/2004; Emergency Ordinance no. 14/2005; Emergency Ordinance no. 31/2006; Law no. 96/2006; Law no. 251/2006; Emergency Ordinance no. 119/2006; Law no. 144/2007; Rectification no. 144/2007; Framework Law no. 330/2009; Framework Law no. 284/2010; Emergency Ordinance no. 37 of 13 April 2011; Law no. 134/2011.
Law no. 80/1995 on the status of the military, published in the Official Gazette of Romania no. 155
Law no. 269/2003 on the status of Romanian diplomatic and consular bodies, published in the Official Gazette of Romania no. 441, partially repealed by Law 263/2010 on the uniform pension system.
The full capacity of exercise is the ability of individuals to fully exercise their rights and to assume obligations by concluding legal documents.
Article 135 of the Romanian Constitution, as republished in the Official Gazette of Romania no. 767 of 2003.
