1725

Authorization procedure and Trade Register aspects for CAEN 1725

Setting up a company with the main activity code CAEN 1725 – manufacture of other articles of paper and paperboard n.e.c. – involves going through the standard registration steps with the Trade Register (ONRC). The basic documentation includes the articles of association, the registration application and the identity documents of the shareholders/administrators. When signing the company contract, the shareholders must submit the declaration on their own responsibility provided by Law 359/2004, attesting to compliance with the operating conditions in accordance with the specific regulations for the activity (e.g., sanitary, fire safety, environmental authorizations). We recommend that for this CAEN code, prior approval from the Public Health Department and the Inspectorate for Emergency Situations be requested at the counter, if the object of activity mentions technological processes or storage of flammable materials.

After registration with the Trade Register, it is necessary to obtain the unique registration code from the Tax Authority (ANAF) (through declaration 010) and to be classified as a profit tax payer or micro-enterprise income tax payer, as applicable. The processing of paper and paperboard in a manufacturing regime does not fall under special authorization restrictions, but the unit must have an operating authorization from the local town hall.

Regulatory framework, specific approvals and control institutions

Activities classified under CAEN 1725 are regulated by the specific fire safety standards (Law 307/2006 and the P.S.I. Normative 2024) and by the occupational safety legislation (Law 319/2006). Since the manufacturing process involves machinery with mechanical and electrical risk, the employer is required to carry out a risk assessment and obtain the ISU operating authorization. Also, Law 211/2011 on waste imposes proper management of paper and paperboard waste, and economic operators must have contracts with authorized sanitation companies and issue traceability documents.

The control institutions are: the National Environmental Guard (for emissions and waste), the Territorial Labor Inspectorate (ITM, for occupational safety and health), and ANAF – the Anti-Fraud Directorate for tax inspections. In addition, if the company exports paper products to the EU, it must comply with the REACH and CLP regulations on chemicals, through safety data sheets and declarations of conformity.

Tax management, ANAF audit risk and specific accounting

From a tax perspective, the manufacture of paper articles falls under the standard VAT rate of 19% (rate applicable for industrial production). Income from the sale of finished products (packaging, labels, stationery articles, etc.) is recorded in accounting through account 701, and raw material costs are reflected in account 601. Electronic invoicing through the RO e-Factura system for B2B transactions is mandatory, according to GEO 120/2021. Inventory accounting is done either through a perpetual inventory system or an intermittent one, but for cost control we recommend the weighted average cost method.

The ANAF audit risk is medium, with emphasis on verifying the correctness of income declaration and the deductibility of expenses with intra-Community acquisitions. Inspections typically target the application of the commercial margin, compliance with the VAT regime for imports of paper from outside the EU, and documentation of waste transports. To mitigate risks in case of a control, it is recommended to keep waybills, purchase invoices and the waste management register. Also, for companies employing workers in activities with special conditions (noise, dust), it is mandatory to declare the work group to the Pension House, according to the legislation in force.