BrusselsThe European Union wants to boost community business activity and increase their competitivenessEspecially in the face of powers like the United States or China. With this objective, Brussels has presented an initiative to allow Europeans to open a company that operates throughout the European Union in less than 48 hours, register online, for less than around €100, and without the requirement of a minimum share capital. European Commission President Ursula von der Leyen explained that the regulation aims to eliminate barriers between national administrations within the European bloc and, therefore, make it easier for new companies to operate throughout the entire EU market from the outset. “Currently, European entrepreneurs who want to expand face 27 different legal systems and more than 60 national legal forms for companies,” the German conservative stated at a press conference this Wednesday.

In this way, companies that voluntarily opt for this regime, dubbed EU Inc., will be able to operate in all Member States without registering individually with each administration or complying with their respective corporate regulations. “Europe’s internal barriers hurt us more than tariffs from abroad,” added the President of the European Commission.

The Commission is optimistic about this initiative, which will now have to be negotiated and approved by the Member States and the European Parliament, and anticipates that some 300,000 companies will be created through the registry announced this Wednesday over the next ten years.

Less bureaucracy

Brussels not only wants to reduce paperwork—one of Von der Leyen’s main objectives—by breaking down administrative barriers, but also to digitize and streamline the procedures for registering a new company. In this regard, the European Commission proposes that companies be able to carry out all operations digitally, from drafting articles of association to liquidation, including financing operations.

Companies opting for EU Inc. will be able to choose which member state they incorporate in and establish their headquarters in, although they can operate throughout the European market. However, Brussels assures that the proposal does not affect the legislation of individual countries and only aims to harmonize corporate regulations. Furthermore, the European Commission includes a list of prohibited practices for companies that choose this EU registration to ensure they receive the same treatment as any state-owned enterprise. In this regard, Brussels maintains that the new regulations will not affect workers’ labor rights, including wages, working hours, and protection against dismissal. For this reason, the European Commission sees no reason for companies to locate in member states with more lax labor regulations, thus avoiding a form of social dumping.