Von der Leyen promotes "EU Inc." in Davos

In her keynote speech at the World Economic Forum, EU Commission President Ursula von der Leyen announced a far-reaching reform of the European economic order. At the heart of her vision for greater European independence is the new "EU Inc." concept. A uniform European form of company that is intended to significantly facilitate growth, scaling and raising capital within the EU.

EU Inc. one company, one set of rules, one single market

With EU Inc., the European Commission wants to create a new, truly pan-European corporate structure. The aim is to allow companies to operate in all member states with a single, simple set of rules. This is intended to remove obstacles that have so far prevented European start-ups and scale-ups from growing just as easily in the single market as companies in the USA or China.

Specifically, von der Leyen announced:

• Company formations should be possible completely digitally within 48 hours, regardless of the country of domicile
• Uniform capital and company rules throughout the EU
• Easy access to financing and investors across national borders

While the single market covers 450 million people on paper, in practice companies encounter new rules every time they expand.

Ursula von der Leyen, President of the European Commission

EU Inc. aims to put an end to this fragmentation.

Response to Europe's structural competitive disadvantages

The initiative is part of a larger project for lasting European independence, economically, technologically and geopolitically. Von der Leyen emphasized that although Europe has capital, talent and innovation, it has not yet mobilized these sufficiently. Different national regulations act as a brake on growth, especially for technology-driven companies.

EU Inc. is therefore closely linked to the establishment of a Savings and Investment Union, which is intended to create deeper, more liquid capital markets so that European companies can access equity more cheaply and quickly.

Europe as an attractive location for global investments

According to von der Leyen, EU Inc. should not only help European companies, but also make Europe as a whole more attractive for international capital. If companies can operate under uniform conditions throughout the EU, investors will be able to plan ahead considerably. The aim is for Europe to be a market in which companies can scale just as seamlessly as in other large economic areas.

Part of a comprehensive reorganization of Europe

EU Inc. is embedded in a broader agenda that ranges from trade agreements (including Mercosur and India) and energy union to defense and security. However, the proposal marks a potential paradigm shift for start-ups, scale-ups and investors in particular: away from 27 individual markets and towards a genuine European economic area.

Start-up base classification EU Inc.

In principle, the idea of an EU Inc. is very welcome, especially if it actually goes hand in hand with a simplified formation procedure and a uniform, clear set of rules. However, the decisive factor will be how this new form of company fits into the existing legal and administrative systems of the individual member states and whether it can prove itself there in everyday life. It remains to be seen which specific requirements will apply, whether it will be an independent legal entity and how national register and reporting obligations, such as the commercial register, transparency register, Federal Gazette or other special national structures (LEIREG, KISTA, etc.), will be integrated in future. Especially in countries with particularly complex incorporation and administrative systems, it remains to be seen whether EU Inc. will bring real relief or merely create an additional layer. Any serious step towards reducing bureaucracy is to be welcomed! Especially if it starts at European level and makes things noticeably easier for founders!