21.10.2026

Can the administrator sell the company’s property without a resolution from the AGM?

Almost any property transaction in which one of the parties is a company raises the same question: does the director have the power to sign on their own, or must they produce a resolution of the general meeting of shareholders (GMS)?

Practice is not uniform. Some notaries require a resolution of the General Meeting of Shareholders every time a property is sold or purchased. Others do not consider it necessary if the transaction falls within the company’s ordinary course of business. For the parties involved, this distinction matters. The absence of a resolution may delay or even invalidate the signing. A resolution requested without justification amounts to an additional formality, and in the case of public limited companies with many shareholders, a meeting that is difficult to convene.

In what follows, we shall analyse the general rule, its exceptions and the three elements on which the answer specifically depends: the company’s objects, the articles of association and the property’s status in relation to the share capital.

1. What is the rule? What can the director do on their own?

Law No. 31/1990 does not contain a list of acts which the director may carry out on their own. The principle is set out in Article 70(1): directors may carry out all operations required to fulfil the company’s scope of business, subject to the restrictions set out in the articles of association.

Consequently, the director’s powers are defined by the company’s objects. Acts relating to day-to-day business fall within their remit. Acts that go beyond this scope, in particular acts disposing of assets not intended for the company’s commercial operations, generally require the shareholders’ consent.

Hence the distinction made in practice:

- Administrative acts (renting premises, purchasing raw materials, entering into standard commercial contracts) may be carried out by the director alone.

- Acts of disposal not relating to day-to-day operations (the sale of the company’s premises, the production hall, or the land on which the factory operates; the creation of a mortgage to secure another person’s debt) generally require a resolution of the General Meeting of Shareholders.

2. Why is a resolution of the General Meeting of Shareholders usually required for property transactions?

For a company that manufactures furniture, provides IT services or engages in retail trade, the property is a fixed asset, not a commodity. Its sale does not serve the company’s business purpose. On the contrary, it often affects the very ability of the company to continue its operations. Similarly, the purchase of a property by such a company constitutes a capital investment that goes beyond the scope of day-to-day management.

In such situations, a resolution of the General Meeting of Shareholders will be required whereby the shareholders:

- approve the sale or purchase of the property;

- approve, where applicable, the minimum price or the essential terms of the transaction;

- authorise the director, or another person, to sign the contract.

3. When is a resolution of the General Meeting of Shareholders no longer required? The role of the company’s object of business and CAEN codes

The situation changes when the company’s business purpose is the trading of property itself. For such a company, flats, land or commercial premises are goods. Their sale is precisely the transaction ‘required to fulfil the scope of business’ referred to in Article 70 of Law No. 31/1990. If we were to require a General Meeting resolution for every flat sold by a property developer, the management of the company would be practically impossible.

What therefore matters is which CAEN codes appear in the scope of business (primary or secondary), as registered with the Commercial Register. It should be borne in mind that we are in a transitional period between two nomenclatures:

Activity	CAEN Rev. 2	CAEN Rev. 3
Purchase and sale of own property	6810	6811
Property development (promotion): the construction of buildings for sale, the subdivision and improvement of land held for sale	4110	6812
Letting and subletting of own or leased property	6820	6820

 

A few clarifications are necessary.

Firstly, the relevant code for sale and purchase is that relating to own property (6811 and 6812 respectively in Rev. 3). The codes for estate agency services (the activities of estate agents, who sell others’ property in return for a commission) do not justify the sale of own property without a resolution of the General Meeting of Shareholders. Nor does code 6820 (letting) cover the disposal of property, but only the granting of rights of use.

Secondly, companies registered before 2025 generally have their business activity expressed in CAEN Rev. 2 codes. The deadline for updating to Rev. 3, originally set for 25 September 2026, was extended by Government Decision No. 788/2026 until 1 April 2027. Until then, both classifications are recognised, so a code such as 6810 or 4110 from Rev. 2 is just as valid as its equivalent in Rev. 3.

Thirdly, not every property owned by a company whose business is in the property sector constitutes ‘goods’. If a developer sells its own headquarters or the land on which its warehouse is situated, the transaction does not form part of its day-to-day business, even if its business activity is in the property sector. We are of the opinion that, in such cases, prudence dictates that a resolution of the General Meeting of Shareholders be sought. The analysis must be carried out based on the specific purpose of the asset within the company’s assets, not merely mechanically according to the CAEN code.

4. What is the role of the articles of association?

The articles of association may restrict the powers of the director: Article 70 of Law 31/1990 expressly refers to ‘the restrictions set out in the articles of association’. In practice, many articles of association contain clauses such as ‘the sale, purchase or encumbrance of the company’s immovable property must be approved by the general meeting of shareholders’ or value thresholds above which the director requires approval.

If such a clause exists, a resolution of the general meeting of shareholders becomes necessary even for a company whose object is real estate, in the internal relations between the company and the director. A director who disregards it incurs liability towards the company, in accordance with the rules governing the mandate (Article 72 of Law No. 31/1990).

A more delicate issue is the effect of these clauses on third parties, that is, on the buyer or seller. Article 55(2) of Law No. 31/1990 provides that decisions of the statutory bodies or clauses in the articles of association which limit the powers conferred by law on these bodies are not enforceable against third parties, even if they have been published. At the same time, according to Article 55(1), the company remains bound even by acts of its bodies that go beyond its scope of activity, unless it proves that third parties were aware of, or, in the given circumstances, ought to have been aware of, such exceeding of the scope. The mere publication of the articles of association does not, in itself, constitute such proof.

One might conclude that, from the purchaser’s perspective, the resolution of the General Meeting of Shareholders is superfluous, as the company remains bound by the contract in any event. However, this conclusion is risky for at least two reasons:

- at the notary’s office, the third party is ‘aware’ of the articles of association. The notary checks the company’s documents, and the articles of association form part of these. A purchaser who signs in the presence of the notary, with the articles of association in plain view, will find it difficult to argue that they were unaware of the restriction, if it relates directly to the company’s object of business;

- Lenders do not assume this risk. Banks that provide loans for the purchase or take out a mortgage on the property require, almost without exception, a resolution of the General Meeting of Shareholders, regardless of the interpretation of Article 55.

Consequently, in notarial practice, checking the articles of association is not a mere formality: a restrictive clause in the articles of association effectively necessitates a resolution of the General Meeting of Shareholders, whatever the company’s scope of business.

Conversely, the articles of association may also expressly confirm the powers of the director: for example, a clause allowing them to buy and sell property as part of day-to-day business, without the shareholders’ approval. Such a clause greatly simplifies the notary’s verification process and is worth bearing in mind when drafting the articles of association for property companies.

5. The status of properties contributed to the share capital

Where a property is contributed in kind to the share capital, it will be valued by an ANEVAR-accredited valuer, and this value will (also) be included in the share capital.

Consequently, as the value of the property is included in the share capital, rather than the property itself, in the event of the disposal of a property contributed to the share capital, no specific resolution of the general meeting of shareholders is required, as the above discussions regarding the company’s objects of business and the limits imposed by the articles of association apply.

However, to the extent that the price obtained for the property is lower than its value as assessed in the share capital, or to the extent that the shareholders wish to increase or reduce the share capital following the disposal, a resolution of the general meeting will be required for this separate transaction.

6. The special case of public limited companies

For joint-stock companies, the legislator has introduced an objective limit, independent of the company’s business activity. Pursuant to Article 153^22 of Law No. 31/1990, the board of directors or the management board, may enter into acts of ac , acquisition, disposal, letting, exchange or pledging of assets whose value exceeds half the book value of the company’s assets at the date of the transaction only with the approval of the extraordinary general meeting of shareholders, granted in accordance with Article 115.

The text makes no distinction as to whether or not the transaction relates to the company’s day-to-day business. Consequently, even a public limited company whose business involves property requires the approval of the Extraordinary General Meeting of Shareholders if the transaction exceeds the threshold of 50 per cent of the book value of the assets. Below this threshold, the general rules analysed above apply.

Article 197(4) expressly excludes the application of the provisions on the management of public limited companies to limited liability companies. Consequently, there is no equivalent legal threshold for limited liability companies, and the only limits are the scope of business and the articles of association.

6. Conclusions

The question ‘Is a resolution of the General Meeting of Shareholders required or not?’ does not have a single answer. The analysis must be carried out on three levels:

1. Scope of business. If the company is registered under a CAEN code relating to transactions involving its own property (6810 or 4110 in Rev. 2, or 6811 or 6812 in Rev. 3), and the property is intended for commercial use, the director may sell or purchase it without a resolution of the General Meeting of Shareholders. In the absence of such a code, a resolution of the General Meeting of Shareholders is required.

2. The Articles of Association. A clause making acts of disposal of property subject to the shareholders’ approval requires a resolution of the General Meeting of Shareholders even for property companies. It would be risky for the parties to rely on the non-enforceability provided for in Article 55(2).

3. The status of the property. A contribution to the share capital does not, in itself, require an amendment to the articles of association upon sale. In the case of a public limited company (SA), there is an additional threshold of 50 per cent of the book value of the assets, as provided for in Article 153^22.

In case of doubt, the cost of a General Meeting resolution is negligible compared to the risk of an action for annulment or the blocking of funding. The practical recommendation remains that, when drafting the articles of association, the director’s powers regarding immovable property should be clearly established, one way or the other, so that the notary’s verification becomes a mere formality.

An article by Marius Chelaru (Managing Associate) –mchelaru@stoica-asociatii.ro – STOICA & ASOCIAȚII.