1320

Authorization procedure and Trade Register aspects for CAEN 1320

The establishment of a company operating in the field of 1320 - Manufacture of woven textiles requires going through the legal stages of registration with the National Trade Register Office (ONRC). When submitting the registration application, the applicant must specify the main activity object, CAEN code 1320, according to the Classification of Activities in the National Economy (CAEN Rev. 2). The constitutive act will include the main activity object (manufacture of woven textiles) and possibly secondary objects, but it is crucial that these are not incompatible with the core activity. The single form (for authorized natural persons or companies) is submitted to the ONRC, and for textile production activities, approvals may be required from local authorities, the Environmental Protection Agency (APM) and the Territorial Labor Inspectorate (ITM), depending on the specifics of the technological processes. In case of taking over a premises already authorized for production, a declaration on one's own responsibility can be submitted according to Law 359/2004.

Regulatory framework, specific approvals and control institutions

Environmental and fire safety approvals

Textile production often involves dyeing, finishing or chemical treatment operations. Therefore, the Company is obliged to obtain an environmental approval from the Environmental Protection Agency (APM) or, for small capacities, a notified agreement. Dyeing and finishing of textile products are included in Annex 1 of Law 278/2013 on industrial emissions, and the operator must fall within the corresponding pollution class. It may be necessary to obtain an integrated environmental permit (IEP) or an environmental permit, depending on the quantities of hazardous substances used. In addition, the fire safety permit is mandatory from the Inspectorate for Emergency Situations (ISU), and the verification of production spaces must comply with P.S.I. norms and the General Norms for Fire Protection (Law 307/2006).

Controls and licenses

Operators in the textile field are subject to control by the Consumer Protection Commissariat (ANPC) for the conformity of finished products. Also, the Territorial Labor Inspectorate (ITM) checks the safety of machinery and working conditions, and the National Environmental Protection Agency controls waste management. There is no special license for the manufacture of woven textiles, but registration as a textile economic operator is required with the Trade Register. For export, an Eco certification (for marketing in the Community space) or certificates of origin are recommended.

Fiscal management, ANAF audit risk and specific accounting

Fiscal and accounting obligations

The company carrying out the activity of manufacturing woven textiles is obliged to register with the Tax Authority (ANAF) with a fiscal vector, CAEN code 1320 being classified under the Fiscal Code – the part regarding corporate income tax, VAT (standard rate 19% for sales of fabrics) and local taxes. Accounting must be kept on a double-entry basis, with distinct records of inventories of raw materials (fibers, yarns, auxiliary materials for treatments), work in progress, finished products and waste. Application of standard or order costs requires a coherent calculation method. Monthly reporting of VAT returns, declarations 394 and 406 (the e-Factura system) are mandatory. Also, for employees, the D112 declaration (Revisal), social insurance contributions (CAS, CASS, CAM) apply.

ANAF audit risks

Fiscal authorities pay special attention to verifying the reality of internal and external transactions, the method of calculating specific consumption and technological losses. A major ANAF audit risk consists in underestimating the taxable base by underreporting actual production or overestimating production costs (for example, recording non-deductible expenses, such as fines or penalties). It is important for the company to maintain supporting documents for all inputs and outputs of materials and products, including consumption notes, inventory sheets and production records. ANAF inspectors may request cost calculation situations and may compare theoretical with actual consumption. Also, for intra-Community transactions, the correct submission of recapitulative declarations (D390 / D390a) is required, under penalty of refusal of VAT refund. Any discrepancy regarding stocks may trigger a tax inspection.

Specific accounting and reporting

Accounting for the manufacture of woven textiles involves planning the production account (accounts 921 – Expenses of the basic activity, 922 – Expenses of auxiliary activities, 923 – Indirect production expenses and 931 – Cost of obtained production) for each type of fabric. It is essential to record separately expenses for materials, labor and machinery wear. Monthly reporting to the Trade Register is done through periodic statements (semi-annual accounting balance for small enterprises). Also, the company must comply with environmental accounting obligations: assessment and recording of provisions for decontamination, environmental taxes, etc. In case hazardous substances are used, annual reporting to the Environmental Protection Agency on emissions is required. Concluding an external audit contract can increase the credibility of financial statements and reduce the risk of unexpected controls. The correctness of data transmitted through the computerized accounting system (e-Factura, e-TVA) is crucial for avoiding penalties and VAT adjustments.