Company formation within 48 hours? A new legal framework for innovative businesses

Uniform rules and a new company form

The key innovation is the introduction of uniform rules in areas such as commercial law, labour regulations, tax legislation and insolvency proceedings. The so‑called 28th legislative framework will create a set of harmonised rules that would apply uniformly in all Member States.

One of the fundamental novelties is the proposal for a new European legal form of commercial company – the Unified European Company (S.EU). In the first phase, this company form should be available to innovative businesses. It could be incorporated online within 48 hours, with the minimum share capital requirement reduced to just 1 euro. An S.EU would be automatically recognised in all Member States, without the need for additional registrations in national commercial registers.

The initiative is also linked to a proposal for a single tax regime, which would apply to S.EU companies regardless of the country in which they carry out their business activities.

Better conditions for investors and employees

The resolution underlines the need for legal certainty for investors, which should facilitate cross‑border investments. Parliament also calls for the introduction of new financing options, for example through special debt instruments that do not confer control over the company but allow participation in its profits.

Employee incentives are another important topic – a harmonisation of rules for employee share schemes and their tax advantages is being proposed.

Faster dispute resolution

For the new S.EU companies, a specialised dispute resolution mechanism should also be established, which could be conducted in English if all parties agree.

If these proposals are implemented in practice, companies operating in the EU can expect a simpler and more transparent legal framework that will support innovation, investment and employee benefits. The exact shape of the new rules will be determined by the European Commission in the next stage of the legislative process.

You can find more detailed information in the E‑News prepared by our colleagues from the KPMG EU Tax Centre.