Europe's start-ups are a step closer to being able to incorporate once and operate across the whole single market, after EU governments agreed their position on the European Commission's plan for a pan-European company, known as "EU Inc."
The Council of the EU, which represents the 27 member states, backed the framework and its main goals on 23 October, opening the way for negotiations with the European Parliament. But governments also gave themselves more time and more control than the Commission had proposed.
What EU Inc. would offer
The Commission presented the proposal on 18 March as a "28th regime", an optional corporate framework that sits alongside the 27 national company laws rather than replacing them.
Under the plan, founders could register a company fully online in about 48 hours, for less than €100, with no minimum share capital. "Any entrepreneur will be able to create a company within 48 hours, from anywhere in the European Union, and fully online," said Ursula von der Leyen, the Commission's president.
Companies would submit their information once, through an EU-level interface linking national business registers, and receive tax and VAT numbers without filing the same paperwork again. A central EU register is planned as a second step. Founders could choose the member state in which to incorporate, while national employment and social law would continue to apply.
The proposal also allows EU-wide employee stock-option plans, taxed only when the shares are sold, and fully digital liquidation, with simplified insolvency procedures for innovative start-ups that wind down.
What governments changed
The Council kept the architecture but added safeguards. Governments would have 21 months to implement the regulation, rather than the 12 the Commission proposed. Member states could refuse a registration on grounds of money laundering, terrorist financing or other criminal activity under national law.
On worker representation, the rules of the country of registration would still apply, but governments added an optional mechanism to enforce national employee-participation rules when a company passes the thresholds in another country where it operates. They also narrowed the scope of the stock-option provisions for small mid-caps, defined as firms with up to 750 employees and €150m in annual turnover.
"EU Inc. has been a key file for the Irish Presidency," said Peter Burke, Ireland's industry minister, whose government holds the rotating Council presidency. He said he looked forward to "forthcoming negotiations with the European Parliament."
Supporters and sceptics
Supporters among European founders and investors argue that a start-up expanding from one EU country to another faces a new set of company rules, notaries and registries each time, and that some therefore incorporate in the United States instead.
Not everyone is satisfied. Julian Teicke, a founder and one of the campaign's prominent voices, criticised the Commission's draft: "Slapping a single login screen over 27 fragmented legal systems isn't the EU Inc. we were promised." Trade unions have the opposite worry. Oliver Roethig of UNI Europa warned that the proposal "opens a window for circumventing national regulatory frameworks."
The Commission has asked the Parliament and the Council to agree the regulation by the end of 2026. Even if that deadline is met, the Council's timetable would give governments until late 2028 to put the new regime into practice.
