Fifty European chief executives and venture capital investors have jointly urged EU policymakers to resist pressure to weaken the bloc's proposed "EU Inc." law, a flagship initiative designed to make it simpler and cheaper for companies to operate across the single market. In a letter sent to Brussels on Thursday, the signatories argue that the final text must deliver a truly European company form, not a compromise that adds little value on top of the existing 27 national systems.
The EU Inc. law, formally known as the Statute for a European Company, is currently being negotiated in the European Parliament and Council. It aims to reduce the administrative burden and legal fragmentation that often prevent startups from scaling beyond their home markets. The proposal is expected to be approved by the end of the year, but recent discussions suggest that the final version may fall short of the ambitions of many founders and investors.
"Policymakers must ensure that the final legislation delivers a genuinely European company form, rather than adding another layer on top of 27 national systems," the letter states. The signatories include prominent figures from venture capital firms such as Index Ventures, Accel, Balderton, Atomico, and EQT, as well as founders from across the continent.
Key demands from the business community
The letter outlines several specific demands. First, the signatories call for the "free choice of registered office," allowing founders to establish their company in any EU member state without being forced to relocate all operations there. This flexibility, they argue, is essential for cross-border growth.
Second, they insist that eligibility for EU Inc. should not be restricted to "innovative" startups. Some policymakers have suggested limiting the scheme to high-tech firms to avoid overwhelming the system, but the signatories contend that such restrictions would undermine the law's purpose. "EU Inc needs to be available to all companies that want to scale across Europe," they argue.
Third, the letter calls for a single, authoritative European register for company records, rather than a mere interface that aggregates data from 27 national registries. This would simplify due diligence and reduce costs for businesses operating in multiple jurisdictions.
Finally, the signatories urge that employee taxation be deferred until shares are actually sold, and that employment protection rules remain tied to the location where employees physically work. These provisions, they say, are critical to making the EU Inc. structure attractive and workable in practice.
The push comes as the EU seeks to boost its competitiveness in the face of global challenges. The bloc has already taken steps to improve the single market, such as reconnecting Brussels Airport to the high-speed rail network and advancing Moldova's EU accession. However, business leaders argue that more needs to be done to remove barriers for companies.
"The question is whether EU Inc becomes Europe's economic engine or a legal structure so diluted that nobody uses it," the letter warns. The signatories are calling on EU institutions to make a decisive choice in the coming weeks.
Negotiators are expected to hold further trilogue meetings in the coming weeks, with the aim of reaching a final agreement before the end of the year. The outcome will be closely watched by the European startup ecosystem, which has long complained about the difficulty of scaling up within the single market.
