The European Union has launched a new initiative aimed at making it easier for businesses to operate across the bloc, unveiling plans for a pan-European company framework designed to cut through legal complexity and energise the bloc's productivity.
The proposal – dubbed “EU Inc” – was presented by the European Commission on Wednesday as a practical step towards strengthening Europe’s economic position at a time when it risks falling further behind the United States and China. By offering companies a single, streamlined set of corporate rules, Brussels hopes to encourage firms to scale up more easily within the single market.
EU justice commissioner Michael McGrath said the scheme had a clear purpose: to reduce fragmentation and allow businesses to operate across borders without navigating a patchwork of national systems. The voluntary regime is primarily aimed at innovative companies, particularly startups looking to expand quickly across Europe.
While the idea has drawn interest from business advocates, it has also sparked debate over how widely it will be adopted and what it could mean for workers.
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Faster route to European growth
At the heart of the proposal is a simplified system for setting up companies. Under the plans, entrepreneurs would be able to establish a business fully online within 48 hours through a single EU access point, with no minimum capital requirement.
Supporters say this could be a game changer for startups. Reinhilde Veugelers, an economist at the Bruegel think tank, said the initiative is ultimately about strengthening Europe’s innovation capacity – widely seen as the key driver of long-term competitiveness.
The ability to gain rapid recognition across all EU member states could make it significantly easier for companies to grow beyond their home markets. At present, firms often face costly and time-consuming legal hurdles when expanding into other countries within the bloc.
McGrath argued that removing the need to navigate 27 different legal systems would help reduce costs, speed up growth and encourage more companies to scale at a European level rather than relocating abroad.
EU leaders are expected to begin discussing the proposal at a summit in Brussels on Thursday, although geopolitical tensions in the Middle East and a resulting oil price shock may dominate the agenda.
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Concerns over workers’ rights
Despite the optimistic tone from Brussels, the initiative has already met resistance from trade unions and campaign groups, who fear it could weaken Europe’s social model.
Critics warn that the speed and simplicity of the new system could make it harder to properly scrutinise companies. Olivier Hoedeman of Corporate Europe Observatory described the proposal as posing a “significant threat” to established protections.
Trade unions have also raised concerns about provisions that could allow companies to offer share options instead of traditional wages. Esther Lynch, general secretary of the European Trade Union Confederation, said future promises of success should not be used to justify lower pay in the present.
The European Commission has sought to reassure critics, insisting that labour laws will remain unchanged and that companies will still be bound by the rules of the country where they are headquartered.
Meanwhile, some in the business community argue the proposal does not go far enough. The industry group EU Inc – which inspired the name of the initiative – said the plan falls short of creating a truly unified legal framework, noting that disputes would still be handled by national courts, leading to differing interpretations across member states. The group has called for the creation of a central EU-level court to ensure consistency.
The proposal, also referred to as the “28th regime”, will now enter negotiations between EU member states and the European Parliament before it can become law. Even so, today’s launch signals a renewed push from Brussels to make Europe a more attractive place to start and grow a business – an effort that is likely to remain high on the bloc’s agenda in the months ahead.
(with newswires)
