What is EU Inc? Limited company for €100 in 48 hours

“This is above all for growth companies and start-ups. Companies with a clear goal of growing in the EU single market and raising finance internationally,” says Antti Turunen, a specialist in company law at Suomen Yrittäjät, the Finnish SME association.

Each of the EU’s 27 Member States has its own limited company legislation. These differ significantly from one another. The new company form, known by the working title EU Inc, would sit alongside the current 27 national limited company laws as a voluntary alternative.

The new EU company could be established easily and fully digitally in Finland, regardless of where its planned registered office is in the EU.

The new limited company form would be useful, for example, in cases where a company grows and establishes operations in several EU countries: hiring employees in Germany, opening an office in France or making an acquisition in Central Europe.

An EU limited company could also be an option for existing companies, as the proposal includes the possibility of converting a current limited company into an EU company.

The EU Inc limited company form could enter into force at the beginning of 2028 at the earliest.

Suomen Yrittäjät views the proposal positively. Turunen stresses that the final benefits of the proposal will depend on how smoothly the legislation takes shape in the EU’s final decision-making process.

Not a tax planning tool

“The actual negotiation phase with the Member States and the European Parliament is now beginning. There’s a risk that a good idea will be overloaded with various additional national requirements,” Turunen says.

He says it is essential for the proposal that all Member States grant the new limited company form the same rights as national limited companies.

The aim is to make establishing an EU limited company significantly lighter than in most EU countries. In many respects, it resembles the process of establishing a limited company in Finland and the Baltic countries. It removes precisely the most rigid elements still found in many countries.

In some EU countries, establishing a limited company costs thousands of euros, with legal costs on top.

The plan is to set a time limit of as little as 48 hours for incorporation and a cost ceiling of around €100. All administrative steps would take place digitally, with no notary required.

The new company form would not change corporate taxation. A company would continue to be taxed based on its actual registered office and operations.

“This isn’t a tax planning tool. Taxation and employment law will continue to be determined by national rules,” Turunen stresses.

Nor is the purpose to circumvent employees’ rights.

“For example, Germany’s strong employee representation in corporate governance will remain in place. An EU company won’t remove these obligations,” he says.

Investor clarity

When an investor considers investing in a European company, they currently have to examine local company law and assess investor protection, option arrangements, exit situations and corporate governance models country by country.

This makes the European market fragmented and difficult to predict from the investor’s point of view, especially compared with the United States, where an established framework govern business activity and investment.

“From the investor’s point of view, there would no longer be a legal difference between whether a company is in Helsinki, Stockholm or Prague,” Turunen says.

If the same shareholder agreements, articles of association templates and investor protection structures worked in the same way in all EU companies, due diligence would become easier and cooperation with investors faster.

Turunen says this would increase predictability, especially for venture capital investors, and could lower the threshold for investing in European growth companies at an early stage.

So how should companies act now if they are interested?

“At this stage, there is no need to rush, or put other company plans on ice and wait for the new company form. The right thing to do now is to follow the legislative process and see what final shape the regulation takes. Once the final framework is clear, it will be time to assess whether an EU limited company is a sensible option for your own growth,” Turunen says.

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