European LLC (EU Inc): Guide To The New 28th EU Regime For Innovative Businesses

How the 28th regime could create an optional EU company form (“EU Inc”) for start-ups and innovative businesses, simplifying access to the single market.

The so-called “European LLC”, also referred to in the debate as EU Inc., the “28th regime”, or the “Unified European Company” (S.EU), is a European Commission proposal aimed at introducing an optional, digital and harmonised company form for innovative businesses operating in the single market.

It is not yet in force: the proposal was presented in March 2026 and is currently under examination by the European Parliament and the Council of the EU.

What is the European Limited Liability Company (EU Inc)?

The AZQQ (28th regime, EU-Inc or Unified European Company) is designed as a new form of limited liability company intended to facilitate the incorporation and growth of start-ups and scale-ups in the European Union.

The underlying idea is to create a single legal framework alongside the 27 national legal systems, without replacing them, allowing businesses to choose between a domestic company form and an optional European regime.

Is the 28th regime already operational?

No. EU Inc. is still a legislative proposal and not a company form that is already available.

The Commission presented the text in March 2026 and the file is now being examined by the European legislative institutions.

According to the official roadmap set by the European institutions, EU Inc. should presumably become operational between the beginning of 2027 and the beginning of 2028.

The legislative process involves three key steps:

• End of 2026 (political objective): the Council of the EU and the European Parliament aim to reach a final political agreement on the text of the law (trilogue agreement) by the end of this year.
• First half of 2027: if the agreement is approved within the expected timeframe, the new company form could technically enter into force and become operational in much of the Union as early as the first months of 2027.
• Beginning of 2028 (large-scale launch): the European Commission’s more cautious estimates provide for a buffer period to allow Member States’ digital systems to adapt, placing the actual launch of the very first EU Inc. companies in the first months of 2028. [1]

Work is progressing at a fast pace, as EU leaders have included the measure among the highest priorities for the competitiveness of the single market. To monitor the progress of negotiations in real time, you can consult the 28th Regime Progress Tracker.

Expected advantages of EU Inc.

The main expected advantages of EU Inc. include digital incorporation, reduced administrative costs and greater ease of operating across borders.

The proposal in fact provides for a digital-by-default approach, with online registration and the use of European business register interconnection infrastructure, including BRIS (Business Registers Interconnection System → the system that interconnects the Business Registers of all European Union countries).

For start-ups and scale-ups, the most significant benefit would be the possibility of avoiding the need to adapt to different company procedures in each Member State.

Expected requirements

The proposal aims to introduce a simplified incorporation procedure based on digital tools and electronic identification compliant with the European framework.

Based on the material currently available, the regime would be designed for limited liability companies with a strong innovative focus and cross-border operations.

However, it remains important to distinguish between the content of the proposal and the final text, because some requirements may be amended during negotiations.

Italian SRL, SE and EU Inc

The Italian SRL remains the natural solution for mainly domestic activities.

The Societas Europaea (SE) is a more structured instrument, often used by groups that are already internationalised.

The future EU Inc. would occupy a different position: it would be a native digital EU company form, designed primarily for innovative businesses seeking to grow beyond national borders.

Summary comparison

28th regime in brief

The 28th regime promises significant advantages thanks to digitalisation and harmonisation:

• Fast, digital incorporation in 48 hours: the proposal aims for very rapid digital incorporation (with a target of around 48 hours), managed entirely online through an interface connected to BRIS (Business Registers Interconnection System), minimising paper-based requirements and physical presence. In principle, this would take place without the need for a physically present notary, without prejudice to the possibility for Member States to provide for additional safeguards.
• Low costs and share capital: the proposal aims for very limited incorporation costs, with a maximum cap that the Commission would like to keep at low levels (in the order of a few hundred euros, with some analyses suggesting a threshold of 100 euros).

No high minimum share capital is envisaged: the idea is to allow incorporation with symbolic capital, and some commentators have suggested the possibility of capital in the order of 1 euro, although the final thresholds will only be set in the approved text.

• Regulatory unification: it will not replace national laws, but will sit alongside them as a uniform 28th regime, with an identical legal form in all 27 Member States, eliminating bureaucratic fragmentation and the costs of cross-border adaptation. This will allow companies to have a legal identity recognised throughout the EU, reducing discrepancies.
• High cross-border mobility: companies will be able to operate throughout the single market using standardised rules, facilitating expansion, the management of branches and access to international venture capital. The transfer of the registered office and the entry of investors will be simplified thanks to dematerialised shares.
• Tools for start-ups: it introduces standardised rules for stock options and venture capital, making it ideal for innovative companies.
• Digital interface (BRIS): management, from incorporation to liquidation, will take place through the business registers interconnection system (BRIS), ensuring streamlined bureaucracy.

What is meant by innovative start-ups and scale-ups

The 28th regime was created primarily to respond to the needs of innovative businesses that want to grow within the European single market without having to deal, from the outset, with 27 different national company systems.

In the European debate, the main reference is to start-ups and scale-ups: two categories that are often connected, but not identical.

Innovative start-ups

An innovative start-up is, in general terms, a young business that develops products, services or business models with a high level of innovation.

It may operate, for example, in the digital, technology, fintech, biotech, artificial intelligence, sustainability sectors or in other high-growth-potential fields.

Not all young businesses are automatically innovative start-ups. The distinguishing element is not only the age of the business, but the presence of an entrepreneurial project based on innovation, scalability and the ability to grow beyond the national market as well.

Innovative scale-ups

Scale-ups represent a later stage compared with start-ups.

These are businesses that have already passed the initial phase, have validated their business model and are growing significantly, for example in terms of turnover, staff, customers, investment raised or presence in several markets.

For a scale-up, regulatory fragmentation between Member States can become a concrete obstacle.

Opening offices, attracting investors, managing shareholdings or structuring incentive plans for employees and collaborators may require complex adjustments across different national legal systems.

Why the 28th regime focuses on these businesses

The objective of the future EU Inc is to offer a simpler, digital and uniform company framework for businesses with a cross-border vocation.

For start-ups and scale-ups, this could mean incorporating and managing a company under more standardised rules, facilitating access to investors and expansion within the European Union.

However, it is important to distinguish between the general concept of an innovative business and the legal requirements that will be laid down in the final text.

National definitions, such as the Italian definition of an innovative start-up, do not necessarily coincide with the criteria that may be adopted at European level for access to the 28th regime.

For this reason, until the legislation is finally approved, it is preferable to consider innovative start-ups and scale-ups as the main target of the proposal, but not yet as rigidly defined categories for the purposes of incorporating a future EU Inc.

Requirements for accessing the 28th regime

The requirements for accessing the 28th regime have been designed to be extremely streamlined, with the aim of lowering the entry barriers typical of national companies.

According to the March 2026 proposal, the main criteria should be:

1. Share capital and costs

The regime should aim for limited incorporation costs and simplified capital requirements compared with many national company forms.

However, minimum capital, maximum registration costs and safeguards for creditors will only be clear after the final text is approved.

2. Digitalisation and identity

• European Digital Identity (EUDI): incorporation should be based on electronic identification tools compliant with the European framework, including digital identity systems recognised in the EU.
  For example, the use of the European Digital Identity Wallet for identification and the signing of documents could be recommended.
• Digital by default: the company should be managed entirely through harmonised digital tools throughout its life cycle (registration, shareholders’ meetings, amendments to the articles of association).
• BRIS system: registration could take place through a single interface connected to the business registers interconnection system (BRIS).

3. Eligible entities

• Universality: the proposal was expressly created to respond to the needs of innovative businesses, in particular start-ups and scale-ups, as indicated by the European Commission; extension to other types of businesses will depend on the text that is approved.
• Optional nature: it will be a voluntary regime that will sit alongside national company forms (such as the Italian SRL), without replacing them.

4. Governance and operations

• Standard articles of association: incorporation should preferably take place through standardised articles of association models at European level to ensure uniformity.
• Freedom of registered office: shareholders may freely choose in which Member State to establish the registered office, regardless of where they physically operate, without discrimination based on location.

Labour, taxation and forum shopping risks

One of the most delicate aspects of the future 28th regime concerns the coordination between the new European company form and national rules on labour, taxation and creditor protection.

EU Inc, in fact, was created primarily to simplify company law and make the incorporation and management of innovative businesses in the single market easier.

This does not mean, however, that a company incorporated under the 28th regime can automatically avoid the tax, social security or labour law rules applicable in the Member States in which it operates.

Labour law and employee protection

The labour issue is central, especially for start-ups and scale-ups that hire staff in several EU countries or use incentive tools such as stock options, financial participation plans or other forms of remuneration linked to the company’s growth.

The proposal aims to promote greater standardisation, but the final text will have to clarify how the new regime will coordinate with national rules on employment contracts, social security, dismissals, worker representation and employee participation in company life.

For this very reason, possible critical issues have been highlighted in the European debate.

The risk is that a more flexible company form could be used not only to simplify cross-border growth, but also to choose the country with rules considered more favourable, reducing the protections provided in other legal systems.

To avoid this effect, clear anti-abuse rules and safeguards will need to be provided, so that the future EU Inc does not become an instrument for circumventing national rules protecting workers.

Taxation and company seat

Taxation also remains a particularly sensitive point.

The creation of a European company form does not, in itself, introduce a single tax system for all businesses that will join the 28th regime.

In general terms, taxation will continue to depend on the country of the registered office, the place where the business actually carries out its activity, the presence of permanent establishments and the applicable national and international tax rules.

This means that the choice of the Member State in which to incorporate or establish the company cannot be assessed solely on the basis of the speed of the procedure or registration costs.

It will also be necessary to consider the tax treatment, accounting obligations, VAT management, taxation of shareholders and any relationships with other countries in which the business operates.

The risk of “letterbox companies”

Among the main concerns that have emerged in the debate is also the possible use of EU Inc to create companies formally registered in one Member State, but with no real economic activity in that territory.

These structures, often referred to as “letterbox companies”, could be used to benefit from more advantageous company, tax or administrative rules without any actual economic establishment in the chosen country.

For this reason, the success of the 28th regime will also depend on the European legislator’s ability to balance simplification and control: on the one hand, making it easier for innovative businesses to grow; on the other, preventing distorted uses of the new instrument.

What start-ups, scale-ups and investors will need to assess

For businesses interested in the future EU Inc, the choice of company form cannot be automatic.

It will be necessary to assess several elements on a case-by-case basis, including:

• country of incorporation and effective seat of the activity;
• markets in which the business intends to operate;
• applicable tax regime;
• presence of employees or collaborators in several Member States;
• access to international investors;
• corporate governance;
• stock option plans or employee financial participation plans;
• any accounting, social security and administrative obligations.

EU Inc could become a very useful tool for start-ups and scale-ups with a genuine European vocation.

However, until the final text is approved, it is advisable to avoid hasty assessments and carefully verify the coordination between the future European regime and the applicable national rules.

At this stage, businesses planning cross-border growth can begin to monitor the evolution of the 28th regime and assess, with legal and tax assistance, which company structure is most suitable for their development objectives.

FAQ Eu Inc. 28th regime

What is the European LLC (EU Inc) under the 28th regime?

The European LLC, also referred to as EU Inc, is the new company form proposed by the European Commission as part of the 28th regime, namely an optional framework of company law harmonised at EU level.
The objective is to allow innovative businesses to operate in the single market with a single set of rules, sitting alongside but not replacing national company forms.

Is EU Inc. already operational?

No, at present there is only a European legislative initiative, presented by the Commission in March 2026, which must be examined and approved by the European Parliament and the Council of the EU.
If the political timetable is respected, the green light could arrive by the end of 2026, with the first incorporations possible during 2027.

Will the 28th regime replace the Italian SRL and other national forms?

No, the 28th regime is conceived as an optional regime: companies will be able to choose whether to incorporate as an EU Inc or continue to use national forms such as the Italian SRL.
In this way, a 28th regime is created in parallel with the 27 national systems, designed especially for those who operate or want to operate in several Member States.

Who will be able to incorporate an EU Inc: only innovative start-ups or all businesses?

The Commission’s proposal was created to respond to the needs of innovative businesses, in particular start-ups and scale-ups that want to grow in the single market.
The final text will have to clarify whether access will be limited to these categories or whether, over time, the company form may also be used by more traditional businesses.

What are the main expected advantages of the European LLC (EU Inc)?

The expected advantages include: very rapid digital incorporation (with a target of around 48 hours), use of an EU register connected to BRIS, reduction of bureaucratic barriers to operating in several Member States and greater ease of access to investors and cross-border venture capital.
For start-ups and scale-ups, this means being able to scale in Europe with a single company form, instead of adapting to 27 different regimes.

Will EU Inc have a mandatory minimum share capital?

The Commission’s proposal aims for a very low or even symbolic minimum capital, in order to facilitate access for start-ups and small businesses.
Some analyses suggest the possibility of incorporating an EU Inc with amounts in the order of 1 euro, but the thresholds and creditor protection mechanisms will be precisely defined only in the approved text.

How does the 28th regime coordinate with Member States’ labour law and taxation?

The EU Inc proposal mainly harmonises the company and governance profile, while labour and taxation remain largely governed by the rules of the country of the registered office and by the applicable national rules.
Precisely the absence of full harmonisation in these areas is one of the critical points raised by legal scholars and trade unions, who fear forum shopping and downward regulatory competition.

What risks and critical issues have been highlighted by trade unions and legal scholars?

The main critical issues concern the risk of opportunistic use of the 28th regime to circumvent national standards on labour and taxation, the possible creation of “letterbox companies” and the impact on the role of national bodies (for example, notaries).
For this reason, the introduction of clear access criteria, anti-abuse rules and safeguards concerning workers’ rights and tax transparency is being discussed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.