Episode 2 from the series „The Firm, Contracts and Liability: From Incorporation to Insolvency”. Updated: November 4, 2026.
Associate or administrator? In a small SRL, the same person can have both qualities. Legally, however, they are different. The distinction matters when you sign a contract, change the management, sell the shareholding, or there are debts.
The associate holds a shareholding in the company; the administrator has an administrative mandate. The assets purchased by the company belong to it. Neither the sole partner nor the administrator become the personal owners of the company’s assets.
A practical situation: who can sign the contract?
Hypothetical example. Ana and Mihai are associated in a limited liability company, and Ana is the sole administrator. Mihai negotiates a contract with a supplier and says he can sign because „the company is also his.” Holding the shares does not alone confer power of representation: the existence of a valid mandate must be verified.
If Ana is subsequently removed from office, she does not automatically lose her social shares. If Mihai sells his share, the operation does not by itself solve all the leadership, guarantee or liability issues. Each quality and each commitment are analyzed separately.
What rights does the associate have in a SRL?
The associate holds shares and participates in the decisions of the company in accordance with the law and the articles of association. He/she may receive dividends when there is distributable profit and the legal conditions are met. The balance of the company’s account cannot be withdrawn at will under the dividend label.
The general meeting of the associates — AGA — approves the financial statements and the distribution of profits, appoints and revokes the administrators, decides on their prosecution for damages caused to the company and amends the articles of association. These powers are provided for by Article 194 of Law no. 31/1990. The rules for convening, voting and conflict of interest must be verified for the specific decision.
Majority participation does not justify ignoring the other associates. For information and conflicts, see also our article about the rights of the minority shareholder in the SRL.
What does the administrator do and when does he/she represent the company?
The administrator organizes the company’s activities and fulfills the obligations related to the mandate. According to Article 197, paragraph (1), the SRL may have one or more administrators, whether associated or not, appointed by the articles of incorporation or the general assembly.
Before signing, check the articles of association, the appointment, the term of office, and the information from the trade register. When there are multiple administrators, it matters whether representation is separate or common. Also check for any internal approvals required for the operation.
The violation of an internal limit does not automatically mean that the act does not produce effects vis-à-vis a third party. Opposability is examined separately, including in accordance with Article 55 of Law no. 31/1990. A valid contract signed in the name of the company binds the company in principle; a personal guarantee is a separate commitment.
Non-associated administrator or sole associated administrator
Associations can entrust the management of a person who does not hold shares. Appointment as administrator does not confer on them the rights of a member. The remuneration of the mandate and dividends have different grounds.
The non-administrator associate retains the company’s rights. In the absence of censors or, as the case may be, a financial auditor, Article 199(5) recognizes his right of control under the text. Requests for documents must be formulated clearly and kept together with the answers received.
In the sole-partner SRL, the same person can also be the administrator. His decisions as an associate are recorded in writing, according to Article 196¹; their execution as an administrator remains a separate activity. Transfers between the person and the company require justification and appropriate documentation.
The removal of the administrator and the assignment are separate operations
Revocation it concerns the administrator function. Transfer of social parties Regarding participation. The person who has been removed from office can remain a member; the administrator who transfers their shares can continue in office if he/she has not resigned separately and the legal requirements are met.
In a separation between partners, the documents must clarify both aspects: who remains associated, who leads, who represents the company and how the documents are submitted. Check the formalities and their effects on third parties; you can read about the transfer here. the transfer of the social partners to the SRL.
A jurisprudential reference is the decision of the Iași Court of Appeal no. 483/13.11.2023: the court treated the revocation as a function of the General Meeting distinct from the amendment of the constitutive act. The decision concerns the respective case and does not replace the analysis of the current voting rules and the documents of each company.
At SA and at private companies the rules differ
In SA, shareholders own shares. In the unitary system, there is a single administrator or board of directors, with the possibility of delegating management to directors under the law. In the dualist system, the board of directors runs the company, and the supervisory board controls the management; representation follows special rules. The SA administration regime does not automatically transfer to the SRL, according to Article 197, paragraph (4).
Article 3 also distinguishes liability: SNC associations and contracting entities in a partnership are liable without limit and jointly, under the law. Shareholders, contracting entities and SRL associations enjoy limited liability. The corporate form must be identified before the risk assessment.
When can personal liability arise?
Functioning or participation does not automatically turn every unpaid invoice into a personal debt. There are distinct grounds: the guarantee assumed, the violation of management obligations, tax cases or liability in insolvency. For explanations, read Episode 1: When you respond with personal belongings.
Law no. 239/2025 amended Article 169 of Law no. 85/2014. The new form includes persons who effectively control financial or operational decisions, regardless of formal qualifications, and allows the action of any interested creditor. However, the conditions of liability must be met; mere insolvency is not sufficient.
Attention to old procedures: Article XXXII of Law No. 239/2025 maintains, as a rule, the previous law for proceedings initiated before its entry into force, with the exceptions expressly listed. The new creditor’s legitimacy does not automatically apply just because the action is filed today. The date of the commencement of the proceedings and the applicable law must be analyzed.
Useful documents, common mistakes and solutions
Keep the updated constituent document, the ONRC history, the AGM resolutions, the convocation notices and the evidence of communication, the mandate contract, the proxies, the commercial contracts and the guarantees. For damages, the extracts, the accounting records and the correspondence that show who decided and what information was available count.
Common mistakes include signing without authority, mixing personal and company money, assuming that revocation means exclusion and the informal handing over of documents. Solutions begin with defining responsibilities, written requests for information, legal summons and documented handing over of documents. Possible actions are chosen based on the subject matter, evidence and deadlines.
Frequently asked questions
Can the associate sign any contract?
Not only based on the shareholding. They must have the right to represent themselves or have a valid power of attorney.
Does the administrator have to hold shares?
No. A SRL can be associated or not associated, according to Article 197.
If I am revoked, do I lose my social benefits?
Not automatically. The termination of the function and the transfer of the share are separate operations.
If I sell the company, do the personal guarantees disappear?
Not automatically. The commitments and terms of release agreed with the creditor must be analyzed.
Sources and legal references
Law no. 31/1990Art. 3, 55, 72–75, 137 and following, 153 and following, 194, 196¹, 197, 199 and 202–203; Law no. 239/2025: amendments to Article 169 of Law no. 85/2014 and Article XXXII; The Bulletin of the Iași Court of Appeal 2023, Decision no. 483/13.11.2023.
For the analysis of the company's documents, a conflict, or the risk of liability, you can request a consultation at 0732.710.701 either through Contact page. The solution depends on the documents and the concrete circumstances.
See the contents of the series: The Firm, the Contracts and Responsibility.
Continuă cu episodul 3: Firma nu își plătește facturile: ce poate face creditorul?
