Bildnachweis: WIPIT.
Prompted by the European competitiveness agenda of Letta/Draghi, the EU Commission presented a proposal on 18 March 2026 for a Regulation on an optional uniform legal form in EU company law designated as “EU Inc.” (COM (2026) 321). This corporate legal form is intended to exist alongside the respective national legal forms (hence the “28th Regime”) and – according to the plan – is to be adopted within the next twelve months following the necessary consultations with the European Council and the European Parliament, becoming applicable from 2028.
The primary objective of the Regulation is the creation of a uniform EU legal form designed to strengthen the functioning of the internal market and facilitate capital investment. The proposal is therefore based on Art. 114 TFEU, which generally requires only a qualified majority in the Council (pursuant to Art. 238 TFEU) for adoption. The reasoning is that the EU Inc., unlike the supranational legal form of the societas europaea (SE), is to be introduced into the legal systems of all Member States as a national legal form of a limited liability company with identical characteristics. To avoid the EU Inc. being implemented in 27 different forms, a Regulation is necessary as it is directly applicable in all Member States (Art. 288 (2) TFEU), unlike a Directive.
The basis
The proposal builds upon years of EU legislative measures regarding digitisation, ranging from Regulation 2018/1724 (single digital gateway) and the Digitisation Directives, forming the basis inter alia for the Business Register Interconnection System (BRIS), to the eIDAS Regulations (electronic identification). With the EU Inc. proposal and the further proposal of a European Digital Identity Wallet (COM (2025) 838), these digitisation efforts are merely being pushed further via the “digital only” principle (Recital 12); they are not new.
What is the EU Inc. about?
The proposed Regulation creates a purely digital legal form exempt from extensive formalities. This is to be achieved particularly through the digital simplification of the formation process and all further corporate law measures, such as amendments to the articles of association, the subscription of new shares, or their transfer. Through the interconnection of registers (“once only” principle), data transmitted via BRIS are automatically forwarded to national tax authorities, social security institutions, and transparency registers. This ensures transparency and accelerates formation, as authorities can issue TIN and VAT identification numbers without additional applications. In terms of organisational structure, the EU Inc. corresponds to a German GmbH but is aligned with a stock corporation (AG) in several aspects (see overview). This applies particularly to:
- The exemption of share transfers from notarisation requirements.
- The introduction of a constitutive share register maintained by the company (similar to the share register under § 67 AktG).
- The introduction of no-par value shares.
While the waiver of a registered minimum capital might raise doubts regarding sufficient creditor protection, this is ultimately safeguarded by the proposal in a manner comparable to the capital maintenance rules of the GmbH through the requirement of balance sheet and solvency tests, which are mandatory for the acquisition of treasury shares, capital reductions, or distributions. It is hardly surprising that the draft Regulation was met with criticism from the Federal Chamber of Notaries: the role of the notary in the formation and subsequent changes to the shareholder structure is reduced to a minimum. Member States are even explicitly prohibited from imposing obstacles to the transferability or subscription of shares; notarial recording is expressly mentioned as such a prohibited obstacle (Art. 59.5 and Art. 67.6). The abolition of the notarial form requirement for share transfers in the GmbH, as well as the UG (haftungsbeschränkt), has so far failed in Germany. Now, it is the EU that is providing a remedy through digitisation. This leads to cost savings not only in incorporation or capital increases, which the proposal primarily emphasises, but also – and especially in Germany – because the freedom of form for share transfers removes any grounds for the highly expensive notarisation of investment agreements. Consequently, these agreements can also be concluded electronically without further ado, even if the proposed Regulation does not explicitly mention this.
Preventive control
However, the preventive control claimed by notaries as “gatekeepers” is not completely abolished. Pursuant to Art. 14 (1), Member States must ensure that the articles of association and any amendments thereto are subject to preventative administrative, judicial, or notarial control, particularly regarding compliance with prescribed formalities and alignment with EU standard documents. In the case of the “fast track” using standard articles of association, this control shall take no longer than 48 hours from submission via the central interface and cost no more than EUR 100 (Art. 16 (2)); otherwise, it shall take no longer than five working days (Art. 17 (2)). Furthermore, Member States must ensure that rules on disqualification for the office of director are established (Art. 22 (3)) and that the information mentioned in Art. 25(1) is publicly accessible in the commercial register. This includes, in particular, the company name, registered office, electronic address, corporate objects of the EU Inc., the articles of association, persons authorised to represent the company, annual financial statements, registration number, the European Unique Identifier (EUID), and any branches (Art. 25 (3)). As an exception to online formation, Art. 10.3 provides for a physical presence requirement only in specific suspected cases of letterbox company abuse or money laundering, or where there are otherwise irreconcilable doubts regarding legal capacity or authority of representation. However, these are likely to remain rare exceptions, as a digital system with a qualified electronic signature, the EUDI Wallet, and automatic register reconciliation ensure sufficient security.
Limits of the EU Inc.
Limits are set on harmonisation in tax law, which remains the domain of the Member States (Art. 114(2) TFEU). This applies in particular to employee participation schemes, which are vital for start-ups. For this purpose, Chapter VIII provides for a unified share option programme, on the basis of which – once adopted by the shareholders’ meeting – the management may issue shares to beneficiaries after a vesting period of at least 24 months. Although this cannot be made binding upon Member States, Recital 58 provides at least a “should provision”: that taxation of these options may only occur when the issued shares are disposed of by the beneficiary, and that the options must be subject to the same tax regime as other employee participation schemes. Similarly, the proposed Regulation (Recital 51) refers to the importance of early-stage financing in anticipation of a later share acquisition, specifically following the model of Simple Agreements for Future Equity (SAFE). In Germany, however, the peculiarity remains that a long-term, subordinated investment with profit and loss participation is treated as equity for commercial accounting purposes, but for tax accounting purposes only if at least a right of repayment is reserved. Regardless, the EU Inc. proposal is a decisive and significant step towards a legal form adapted to the digital world.
Conclusion
It does not take three guesses to know which one a start-up would choose: the legal form of the GmbH in its current state, or the EU Inc.
About the author:
Dr Wolfgang Weitnauer is founding partner of WIPIT Partnerschaft mbB Rechtsanwälte Steuerberater, based in Munich.
