Merger and division nullity in the romanian legal system

• Author: Bejan Felicia
• Position: The Bucharest University of Economic Studies, Department of Law
• Pages: 13-21

AGORA International Journal of Juridical Sciences, www.juridicalj ournal.univagora.ro

ISSN 1843-570X, E-ISSN 2067-7677

No. 2 (2013), pp. 13-21

13

MERGER AND DIVISION NULLITY IN THE

ROMANIAN LEGAL SYSTEM

F. Bejan

Felicia Bejan

The Bucharest University of Economic Studies, Department of Law

*Correspondence: Felicia Bejan, Faculty of Political Science, 24 Sfântul tefan St. Bucharest,

Romania

E-mail: felicia.bejan@fspub.unibuc.ro

Abstract

As a consequence of the transposition of European Directives regarding the merger,

division, and cross-border mergers, the Romanian legal system established a special legal

framework with regard to the sanction of nullity for such juridical acts. The peculiarities of

internal and cross-border reorganisation operations and the imperative of protecting the

interests of third parties, associates, and the companies involved led to the creation of a

derogatory legal system on the matter. An analysis of both theoretical and practical

perspectives of the subject matter may result in a useful instrument for the application of

incidental legal norms, or every time restructuring juridical acts contravene the legal norms.

Key terms: nullity, merger, division, judicial character, nullity remedy.

Introduction

Generically, mergers and divisions are juridical acts concluded with the agreement of

the participating legal persons and which, for their valid coming to being, need to fulfil

conditions regarding the capacity, consent, object, cause and form regulated by legal norms.

Contrary to most juridical acts, mergers and divisions are concluded under particular

form and substance conditions imposed by law, justified by the complexity and effects of such

acts in relation to the very existence of the legal entities involved.

Given that the valid concluding of a juridical act requires more conditions to be

accomplished, leading therefore to the existence of a bigger number of nullity causes, the

importance of the respect for the rule of law in every moment and for every part of the merger

or division procedure becomes obvious.

1. The legal background

The merger and division nullity is regulated by the Law 31/1991 in article 251. As it

results from the legal dispositions, the merger and division nullity sanction concerns the

merger or division process producing effects, according to the law article 249. Therefore, the

accuracy and legality of different specific acts and formalities undertaken during the merger

or division procedure will be able to make the object of a legal action only after the merger or

division juridical act begins to produce legal effects.

The merger and division legal regime derogates from the common law regime

concerning the nullity of the juridical act, according to the stipulations of the European

directives with regards to mergers and divisions. In the preliminaries of the joint-stock

companies Merger Directive nº III, respectively of the Division Directive nº IV, it is shown

that one of the objectives to be achieved by the Member States consists in the broadening of

the guaranties provided to shareholders or third parties with regard to mergers and divisions.

Thenceforth, in the justification part of the European legislative acts, it is mentioned that “in

order to ensure the legal certainty in those reports between companies involved in mergers or