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DRAFT REPORT (2025/2079(INL))

With recommendations to the Commission on the 28th Regime: a new legal framework for innovative companies

JURI-PR-773199

Committee on Legal Affairs · Rapporteur: René Repasi

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Written by a language model from the full text only; every figure comes from the text. The paragraph links open the paragraph a statement rests on — check the text itself before relying on it.

This draft report proposes a new EU legal framework, the '28th Regime', for innovative companies, to be called the 'European Start-Up and Scale-Up' (ESSU) company. It recommends a directive based on Articles 50 and 114(1) TFEU, with maximum harmonisation, and rejects other legal bases. The ESSU would be a national limited liability corporate form, automatically recognised across the EU, with simplified digital registration within 48 hours. It includes safeguards for labour law and codetermination, optional long-termism schemes, employee stock ownership, equity-like debt instruments, and specialised dispute resolution.

Committee position. The rapporteur proposes a directive-based 28th regime for innovative companies, named ESSU, with maximum harmonisation and safeguards, and requests the Commission to act by early 2026.

Key points

  1. Requests the Commission to submit a proposal for a directive by the first quarter of 2026, based on Articles 50 and 114 TFEU.
  2. Opposes Article 352(1) TFEU, enhanced cooperation, and intergovernmental agreements as legal bases.
  3. Calls for maximum harmonisation to ensure uniform rules in all Member States.
  4. The ESSU should be a limited liability company, not listed, with registered seat in a Member State, and open to any company, not just 'innovative' ones.
  5. Registration must be digital, completed within 48 hours, and follow the 'once only' principle; a uniform EU digital register should be created.
  6. The ESSU must not undermine labour law or codetermination; codetermination law is determined by the real seat.
  7. Calls for optional steward ownership, asset locks, and dual-class shares to protect against 'killer acquisitions'.
  8. Calls for harmonised rules on employee stock ownership plans, with principles of transparency, non-discrimination, and voluntary participation.
  9. Calls for harmonised equity-like debt instruments that allow investment without control rights.
  10. Calls for model documents and expert groups to develop standardised articles and shareholder agreements.
  11. Calls for an alternative dispute resolution mechanism and special national court panels for ESSU disputes, with English possible.

Who is affected

  • Small and medium enterprises, start-ups and scale-ups in the EU that may opt into the ESSU corporate form.
  • Member States, which must incorporate the ESSU into national law and ensure automatic recognition.
  • Investors, who may use new equity-like debt instruments and model agreements.
  • Employees of ESSUs, who may participate in stock ownership plans and retain labour protections.

Figures and deadlines

  • Registration of an ESSU must be completed within 48 hours.
  • Minimum paid-in capital for ESSU registration is set at EUR 1, with 25% of annual profits allocated to a legal reserve until reaching national minimum.
  • Proposal for a directive to be submitted by the first quarter of 2026.

Legal basis: Articles 50 and 114(1) of the Treaty on the Functioning of the European Union