On the legality of the director’s mandate in a Romanian Joint Stock Company

Abstract

A recent decision of the Romanian High Court of Cassation and Justice (IInd Section, Decision no. 153 of 28 January 2021) draws attention to the attributions of the director in a legal entity. More specifically, how the powers and liabilities of the director should be handled if they have not been attributed according to the legal provisions or according to the internal statutes of the legal entity. Although the applicable law, i.e., the Company Law, has not been amended in this area following the economic crisis due to the pandemic situation generated by COVID-19, the legal provisions should still be observed so that the economic decision becomes effective in accordance with the law. Without being exhaustive, the article aims to underline the applicable legal provisions to the decisions of a company on the mandate of the director and the practical consequences if not observed.