PROFIT AND LOSS SHARING IN THE PARTNERSHIP AGREEMENT UNDER THE NEW ROMANIAN CIVIL CODE
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| Title | PROFIT AND LOSS SHARING IN THE PARTNERSHIP AGREEMENT UNDER THE NEW ROMANIAN CIVIL CODE |
| Authors | |
| Abstract | The new Romanian Civil Code regulations have reconfirmed the rule ofproportionality when speaking about profit and loss in a partnership agreement. Basically,the law does not require that the participation of partners in profit and loss be necessarilyproportional to their contribution to the society’s capital and the associates can evendetermine their share of benefits and losses. In case the associates establish by contract onlytheir share of benefits, then their contribution to losses will become proportional to theirprofit share. If the share of profit is not proportionally equal with the contribution, then thecontribution to debts will be proportional with the profit share and not with the contributionbrought to the capital.One must keep in mind as compulsory the condition that each partner shouldparticipate both in profit and loss sharing. On the one hand, a partner cannot reserve all thebenefit for himself only, while on the other hand the partners cannot decide that one orseveral of them are exempted from participating in loss sharing. Also, they cannot set aprovision by which a partner is excluded wither from profit sharing or from participation inloss, as this provision would be void ab initio. |
| Publisher | Agora University Oradea |
| Date | 2013-07-01 |
| Source | Agora International Journal of Juridical Sciences Agora International Journal, No 2 (2013) |