EU Inc 28th corporate regime, Digi Mart USA News (Brussels): A new administrative simplification measure for businesses is facing a difficult passage through the European Parliament. The European Commission proposes a 28th corporate regime, called “EU Inc”, that would sit alongside the 27 existing national company regimes in member states.
According to the proposal described in the report, companies registered under the EU Inc status could be created in just 48 hours for less than 100 euros in administrative fees. The process would be fully online through a dedicated European digital interface, no minimum share capital would be required, and administrative checks would be drastically reduced, regardless of the member state where the company is registered.
Questions remain about how the new regime would interact with national law. The Commission has stated that the 28th regime would not affect national social legislation.
However, the report notes that some harmonization of rules would still occur, raising questions such as whether unpaid wages would always be treated as priority claims in bankruptcy, and how collective agreements negotiated by social partners in each country would be affected.
Many members of the European Parliament say the relationship between the company law of the country of registration, the laws of countries where the firm operates, and the new regime lacks clarity, and they have requested at least clarifications. The economic effectiveness of the measure is also disputed.
The regime was originally designed for the digital sector as a way to close innovation gaps with the United States, but it is now proposed to extend to more traditional sectors such as construction and personal services, some of which the report says have been linked to money laundering. Lawmakers have questioned whether lowering controls for such sectors is wise, and the scope of the regime remains unresolved.
The text is expected to move to the full Parliament plenary at the end of November, where political groups will voice positions on the most contentious points. A trilogue phase among the Commission, Parliament and member states would follow next year.
Member states have already adopted a common position, welcoming a “simpler and more flexible” framework for businesses, while seeking to exclude companies suspected of illegal activities under national law.
