The EU-INC project: a missed opportunity for European competitiveness
The leak of a draft EU-INC implementation framework reveals a project that falls far short of the expectations it raised. Instead of creating a genuine "28th regime" with a single registry, unified rules and procedures, the system would remain administered by existing national jurisdictions. This would result in the coexistence of 27 courts, 27 administrative paces and 27 potential interpretations, which contradicts the stated objective of simplifying and unifying the internal market.
The promise of a genuinely European 28th regime
A 28th regime is not institutional vanity, but a decisive lever for completing the single market. It would allow European companies to develop immediately at EU scale, without having to deal with 27 legal and administrative regimes. Historically, the Societas Europaea (SE) had already attempted to offer a form of European company, but at the cost of complex national transpositions and costly cross-border mergers, which limited its use, particularly by SMEs.
EU-INC was precisely designed to break away from these limitations: a European legal form from the outset, a single body of rules and a centralized registry at Union level. This ambition was part of broader reflections on an optional "28th regime" intended for innovative companies, mentioned by the Commission and certain academic work on company law and internal market integration.
A fragmented implementation that neutralizes the reform
The current project is more about political communication than structural reform. By leaving national registries in charge, it recreates the same fault lines that EU-INC claimed to erase. A German or Portuguese entrepreneur using EU-INC will still face different requirements, deadlines and interpretations depending on the Member State of recourse. Performance gaps between national registries are well documented, with some states processing registrations in a few days, others in several months.
For multi-country companies, compliance would become even more complex as each jurisdiction adds its own interpretative layer to European rules. This produces a "European" form that leaves intact the administrative barriers that the 28th regime was supposed to remove.
Lessons from national registry reforms
Commercial registries remain essential for legal certainty and confidence in transactions. Some states have shown that ambitious modernization is possible: the United Kingdom, for example, has introduced mandatory identity verification at Companies House, while several EU Member States have accelerated the digitization of business creation procedures. This progress proves that with genuine political will, more efficient and secure registries are achievable.
However, these fragmented reforms do not replace a unified European approach. The strategy for a digital single market underlines the need to remove digital barriers, but the proposed EU-INC structure continues to rely on physical and jurisdictional borders inherited from the pre-digital era. What would have been consistent with the European digital agenda is a single registry, entirely online, with standardized procedures and automated controls, accessible from any Member State.[^8][^7][^1]
A political economy of immobilism
The result reflects the conjunction of national interests, bureaucratic resistance and a lack of political audacity. National registries are centers of administrative power and providers of public sector jobs; their managers have little interest in transferring their competencies to a European authority. Similarly, part of the legal professions benefit from the current complexity, which generates demand for specialized advice on national company law.
One can assume that lobbying against a fully unified registry comes from both national administrations concerned with preserving their prerogatives, professional organizations worried about their business model and established companies that fear losing the rents of complexity. This compromise illustrates a now classic European method: seeking the lowest common denominator rather than assuming a clear integrative choice.
The imperative of global competitiveness
In a global environment where it is possible to incorporate in Delaware or Singapore to operate internationally with fast and readable procedures, the persistence of European fragmentation constitutes a manifest competitive handicap. The United States has long benefited from a quasi-national company registry with Delaware, which offers legal certainty, specialized justice and procedural efficiency. This centralization strongly contributes to the attractiveness of the American market and the ease of scaling companies.
In Asia, initiatives like the ASEAN Economic Community are working to progressively harmonize commercial rules, creating an environment more favorable to regional integration. If Europe remains unable to overcome its national divisions to offer a truly unified business framework, it risks losing ground in the global competition for investment and talent.
What a genuine EU-INC could have been
An ambitious version of EU-INC would be based on a centralized European registry, primarily digital procedures that are truly uniform in all Member States. Registration would be done via a single online portal, multilingual, with automated controls and guaranteed deadlines, in the spirit of proposals carried by certain collectives of founders and lawyers favorable to a full "EU-INC".
Disputes would be settled by specialized European commercial courts, applying a single interpretation of European company law. The legal form would be natively adapted to the digital era: virtual shareholder meetings, digital securities and registries, even using blockchain for participation traceability when relevant. It would incorporate modern governance structures reconciling flexibility and investor protection, inspired by best existing practices in Member States.
Above all, this 28th regime would offer substantial advantages over national forms: simplified cross-border mergers, automatic recognition throughout the EU, mobility and financing regime designed for pan-European expansion of innovative startups and SMEs.
European integration lacking courage
The inability to design a strong EU-INC reveals deeper weaknesses in European integration. While notable progress has been made for the free movement of goods, services and capital, the creation of genuine "European" company structures remains behind. The unanimity rule on sensitive subjects like company law favors minimalist compromises, which preserve national levels at the expense of single market efficiency.
Alternative approaches, such as enhanced cooperation between willing states, could have allowed launching a hard core of truly integrated EU-INC, leaving the door open for progressive rallying. This option is regularly discussed in specialized literature on differentiated European integration and overcoming institutional blockages.
What to do now?
Despite a disappointing text, the legislative process is not complete. The European Parliament, Council and Commission still have room to substantially improve the system, provided political pressure is exerted in this direction. Professional associations, startup ecosystem actors and political leaders favorable to deeper integration can advocate for amendments bringing the project closer to the initial ideal of a complete 28th regime.
Even if the architecture remains decentralized, detailed implementing acts could limit national interpretation margins and strengthen application consistency. The Commission could also use infringement procedures against states that reintroduce in practice obstacles contrary to the spirit of EU-INC. Beyond this case, the experience must serve as an alarm signal: half-measures will not be enough to restore European competitiveness in a world where other major regions are moving toward more unified legal frameworks.
Europe deserves a genuine European company
European entrepreneurs need a legal form that allows them to think and act at continental scale from day one, without suffering the cumulative burden of 27 administrative traditions. EU-INC was a test of the Union's capacity to produce concrete solutions serving its competitiveness; by heading toward a fragmented model masked by integration discourse, this test is currently failed.
The message sent to founders and investors is clear: the EU remains a mosaic of interlinked markets rather than a homogeneous economic space. As long as this gap between integration rhetoric and regulatory reality persists, European companies will operate with a structural handicap compared to their competitors benefiting from much more readable frameworks. It is now up to political decision-makers, legal practitioners and entrepreneur communities not to let this opportunity for in-depth overhaul dissolve definitively.
notes
Le-projet-EU-INC-deception-manque-ambition.md https://commission.europa.eu/eu-inc-new-harmonised-corporate-legal-regime_en https://www.loyensloeff.com/insights/news--events/news/the-28th-legal-regime-enhancing-european-competitiveness-and-innovation/ https://proposal.eu-inc.org https://www.codeeuropeendesaffaires.eu/2025/01/29/european-business-code-and-28th-regime-for-innovative-businesses/ https://single-market-scoreboard.ec.europa.eu https://europeanshippers.eu/the-2025-annual-single-market-and-competitiveness-report/ https://www.eu-inc.org https://eu.inc https://www.reddit.com/r/BuyFromEU/comments/1qiy3a2/euinc_explained_simply_a_new_euwide_company_form/ https://www.euronews.com/my-europe/2026/02/03/what-is-eu-inc-and-its-plan-to-make-european-businesses-borderless
