MEPs’ recommendations for a new EU framework for innovative companies
To boost investment and innovation, MEPs propose a separate corporate structure recognised across EU countries and based on fully harmonised rules.
With 18 votes in favour, 4 against and 1 abstention, the Legal Affairs Committee approved series of recommendations for an upcoming Commission proposal on a new legal framework to support innovative companies, known as the “28th corporate regime”. According to MEPs, to boost cross-border mobility, investment and innovation, the EU needs harmonised rules tailored to SMEs, including startups and scaleups, aligning EU company law with the dynamic needs of modern businesses.
Unified European Company (S.EU)
MEPs want a new harmonised corporate form, the Unified European Company (S.EU), to be registered digitally within 48 hours. It should be a non-listed limited liability company with a seat in one of 27 EU countries and with the possibility to change its seat to another EU country without having to dissolve and re-establish.
This corporate form’s minimum required paid-in capital should be one euro and its use should not be limited only to innovative companies. MEPs call for the creation or integration into existing structures of a uniform digital multilingual portal to facilitate digital processes for S.EUs, including communication with authorities and providing information for investors.
Attracting investors and talent, and specialised dispute resolution
MEPs stress the need for alternative financing models to ensure access to capital for the S.EUs. They want the Commission proposal to include harmonised rules for attracting investments and diversifying financing beyond venture capital.
To attract and retain top talent in these companies, EU-wide rules for employee financial participation, through the creation of employee stock ownership plans and employee stock options, should also be proposed. MEPs finally want the S.EUs to be subject to accelerated and specialised dispute resolution mechanisms, which could be conducted in English.
Quote
Following the vote, rapporteur René Repasi (S&D, DE) said: “The 28th corporate regime is an essential piece of the puzzle for completing our internal market. If we want Europe to compete globally, we must ensure that great ideas are not only born here but have the space to grow, attract investment, and scale in the EU, without becoming a vehicle for circumventing the social fabric of our member states.”
Next steps
This legislative initiative report will now be voted on at one of the upcoming plenary sessions.
Background
Parliament’s priorities regarding the so-called 28th regime for EU companies should feed into the Commission’s legislative proposal. MEPs want the Commission to submit it by the first quarter of 2026 considering that it should be covered by robust budgetary allocations.
