The rise in the number of insolvencies in Romania reflects a more demanding market and a natural selection of vulnerable companies, rather than the emergence of a generalised economic crisis, according to an analysis by Cătălin Guriță, lawyer and insolvency practitioner, founding partner of GMCID.
Analysis by Cătălin Guriță, lawyer and insolvency practitioner, founding partner of GMCID.
The number of companies entering insolvency in the first quarter of 2026 stood at 1,829, up 14.31% compared with Q1 2025, while a study conducted by Coface at the beginning of the year pointed to a 36% increase in January 2026 compared with January 2025.
The figures must be read in relation to the dynamics of the economy, the number of newly established companies, access to financing, and the differences between sectors of the economy. Based on public data and market practice, vulnerability is mainly visible in sectors with low margins, high working capital needs, and dependence on short-term financing: trade, construction, transport, hospitality, some areas of manufacturing, and real estate. My message is the following: not all companies are in difficulty, but undercapitalised companies that depend on supplier credit, have low margins, and lack cash-flow discipline are much more exposed than in previous years. We are not facing a general crisis, but a market that no longer forgives a lack of liquidity and a lack of adaptation.
Insolvency most often appears where growth has been financed through debt and margins can no longer absorb the cost shock. The most frequently ignored warning signs are almost always related to cash flow, rather than accounting profit. Entrepreneurs see turnover, contracts, and ongoing projects, and postpone the uncomfortable conclusion that the company can no longer pay on time. Typical signs include repeated delays in paying suppliers, rolling over tax debts, using VAT or social contributions as a source of current financing, refinancing carried out only to delay payments, a growing number of commercial disputes, missed reporting deadlines, and increasing pressure from banks.
Unfortunately, many companies reach a lawyer or specialist when garnishments, enforcement procedures, termination notices, or insolvency requests filed by creditors already exist. Work can still be done at that stage, but the room for manoeuvre is much smaller. Ideally, restructuring discussions should begin when the company is in difficulty but can still meet its due obligations, not when insolvency has already set in. However, insolvency does not automatically mean bankruptcy. Law 85/2014 aims to cover liabilities, but also to provide, where possible, an opportunity to restore business activity. A procedure used in time can protect assets, stop individual enforcement actions, allow organised negotiations with creditors, and give the company time to restructure.
An effective but little-used instrument in Romania is the preventive composition procedure, which intervenes before insolvency itself, when the company is in difficulty but can still pay its due debts. The procedure allows for a restructuring plan, negotiations with creditors, protection against certain enforcement actions, and greater debtor control over the business. In essence, it is a mechanism through which a company attempts to avoid insolvency, rather than disguise it.
Preventive composition is little used in Romania for three reasons: the lack of a prevention culture, fear of stigma, and entrepreneurs’ reflex to negotiate individually until the situation becomes too complicated. Coface data show that 221 preventive composition procedures were opened in 2025, compared with 96 in 2024, which indicates growth, but the base remains low in relation to the total number of companies in difficulty. Preventive composition is the preventive medicine of companies, while insolvency is surgery. The problem is that most entrepreneurs reach a specialist when the intervention has already become an emergency.
Recommendation for entrepreneurs
The first step is a real picture of liquidity over the next 13 weeks: what will be collected, what needs to be paid, which debts are due, which contracts may be lost, which tax debts exist, and which guarantees can be enforced. Based on this picture, it can be decided whether the discussion should focus on operational adjustments, negotiations with creditors, preventive composition, a restructuring agreement, or insolvency.
The second step, immediately after diagnosis, is to stop making isolated decisions. In difficulty, every payment, every new contract, and every postponement can have legal consequences. The entrepreneur should bring the lawyer, financial consultant, and, where appropriate, insolvency practitioner to the table before the case is pushed forward by creditors.
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