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The European Commission has taken an important step to strengthen EU-wide competitiveness and advancing the Single Market, as well as assisting the corporate community with adequate “instruments” in growing and scaling businesses. The Commission’s goal is simple: making it easier for businesses (especially for start-ups and scale-ups) to flourish in the EU and compete and innovate globally. The concept is called the 28th regime (or the EU Inc.), thus supplementing the EU-27 member states’ corporate structures.
The EU-wide 28th corporate regime’s concept
The 28th regime (the so-called EU Inc. structure) is a proposed unified but voluntary legal framework operating alongside the existing 27 national corporate laws in the EU member states: i.e. it is aimed at providing businesses (particularly startups and scale-ups) with a single set of rules for operating across the EU. It focuses on simplifying corporate law, insolvency, labor and tax rules to reduce barriers to cross-border growth and innovation.
The initiative, which was specifically mentioned in the Enrico Letta report in 2024 and championed by the European Commission, is scheduled for the preparation of a new legislative draft during 2026.
However, the project is controversial: e.g. with criticism from such sides as the trade unions, arguing that it could allow companies to circumvent stricter national labor laws and social protections, creating a “race to the bottom” in employment standards.
Source: https://www.europarl.europa.eu/thinktank/en/document/EPRS_BRI(2025)779233
This ambition is not new: the Commission has had several initiatives to deal with the problem – e.g. the EU’ Competitiveness Compass, the Start-up, the Scale-up and the Single Market Strategies. The whole idea has been to introduce the so-called 28th regime (dubbed the EU Inc.) as the game-changer endeavor, which is aimed at providing a flexible, digital by default and modern company law framework. It is covering the companies’ entire life cycle: from setting up and scaling up to winding down.
More in: https://commission.europa.eu/topics/business-and-industry/doing-business-eu/company-law-and-corporate-governance/eu-inc-new-harmonised-corporate-legal-regime_en
The main stumbling block for the EU Inc. idea’s implementation is the European Single Market, which represents one of the largest consumer markets in the world with about 450 million people with talents, ambition, skills and innovations. Yet, bureaucracy, unnecessary burdens and corresponding costs are pushing creative enterprises to look in other global markets, as the corporate entities as well as investors are faced with 27 national legal systems and more than 60 different company forms and regulations.
Source: https://ec.europa.eu/commission/presscorner/detail/en/speech_26_643
The Commission has just presented the EU Inc. concept, as a new single set of corporate rules that will be the same and apply unanimously in the European continent. The new rules are expected to make it easier for businesses to start, operate and grow across the EU member states. The procedures are optional and fully digital to enable innovative companies to scale up and incentivise to stay in Europe, as well as encourage those who would like to start and/or return to Europe. The EU Inc. is part of the new broader 28th regime that offers businesses the chance to seize the benefits of the single market.
Currently, entrepreneurs and innovative companies face a fragmented corporate legal landscape. With 27 national legal systems and more than 60 company legal forms in place, it can take a company weeks or even months to set up, slowing growth and raising costs. The EU Inc.’s single harmonised set of corporate rules would mean that companies no longer need to navigate multiple national regimes, unlocking the true potential of the single market while driving growth and increasing competitiveness.
More on the EU Inc. proposal in: https://proposal.eu-inc.org/?v=14d076fd79c58146b048000caeed686a
The EU Inc. – main strategic lines
Main EU Inc. features include:
= faster registration and simpler procedures: founding an EU Inc. company within 48 hours, for less than €100 and with no minimum share capital requirements and by only submitting their company information once, via an EU-level interface;
= fully digital operations throughout a company’s lifecycle;
= helping founders restart faster and cheaper: simplified liquidation procedures, enabling founders to test out innovative ideas and start again if needed;
= better conditions to attract investment by removing in-person formalities, providing digital procedures for financing operations and simplifying the transfer of shares with possibilities to access the stock exchange;
= full access to the single market: by freely choosing the EU country in which they incorporate;
= strong safeguards against abuse: national employment and social laws are not affected by the proposal. The applicable safeguards of the EU country of registration will apply in full to the EU Inc. company.
Source and citations from: https://commission.europa.eu/news-and-media/news/eu-inc-making-business-easier-european-union-2026-03-18_en
The EU Inc. regime also sets out measures for innovative companies to get access to funding, and operate seamlessly across borders, in all matters concerning their business. This includes measures on digitalisation, access to finance, measures to attract and retain talent, taxation, and to ensure a clear, predictable and swift legal framework.
Source: https://ec.europa.eu/commission/presscorner/detail/en/qanda_26_615
Digital by default: towards modern corporate services
“Digital-by-default” is a strategic approach where digital services are designed to be the primary, most convenient option for users, making online interaction the standard over paper-based processes. It aims to improve efficiency and reduce costs, while ensuring services are user-friendly. Common examples include online tax filing, digital signatures, and automated public services. In technology, the term “default” refers to the preset or standard configuration, setting, or behavior of a system, software, or device. It’s what you get out of the box before making any customizations or changes.
Digital by default means digital services which are so straightforward and convenient that all those who can use digital services will choose to do so, while those who can’t are not excluded.
Evidence-based insights into the seven pillars that drive exceptional digital transformation outcomes have revealed the following: = strategic leadership and vision; = cultural transformation and change management; = technology excellence and architecture; = data-driven decision making; =customer-centricity and experience innovation, etc. The four digital by default pillars are: technology, process, people, and skills; they represent the foundational areas in which organizations must align to successfully navigate digital change (as each pillar supports agility, scalability and innovation.
The Commission will use a set of tools to support the new initiative, for example in the context of the European Judicial Training Strategy 2025-2030. Creating a supportive environment for DigitalJustice@2030.
More in: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:52025DC0801
Towards EU-wide innovative startups
Under the Commission’s recommendation, an innovative enterprise is a company whose research and development costs represented in the last three years at least 10% of its operating costs or at least 5% of its total sales. A company can also be considered an innovative enterprise if it has or will soon develop a major innovation, which holds risks of market or technological failure.
= An innovative startup is an innovative enterprise with less than 100 employees and with an annual turnover or balance sheet of less than €10 million. It must have also been operating for less than 10 years.
= Innovative scaleups are innovative enterprises with an annual turnover or balance sheet of more than €10 million, and which must have increased the number of its employees or revenues by 20% in the last two years, and either employs fewer than 750 persons or is not publicly listed.
Source: https://research-and-innovation.ec.europa.eu/document/download/4e3cd140-47ed-4de2-be02-af1f344a2990_en