Toward a Pan-European Corporate Standard: The 28th Regime and Legal Fragmentation

Europe’s structural challenge is not merely regulatory divergence, but deep and persistent fragmentation across the corporate law jurisdictions of the Member States of the European Union (the "Union"). Despite the existence of a Single Market, companies incorporated under national laws face materially different legal and regulatory frameworks when seeking to raise capital across borders. International investors, particularly venture capital and growth funds, are often unfamiliar with the corporate regimes of individual Member States and reluctant to price legal uncertainty. Operating under tight timelines and standardised risk frameworks, they tend to prefer jurisdictions with globally recognised corporate standards, most notably the United Kingdom and the U.S. state of Delaware. As a result, European companies are frequently encouraged to reincorporate outside the Union or are disadvantaged from inception. This fragmentation also impedes the exchange of talent, expertise and ideas within the EU itself: when corporate structures do not travel easily across borders, collaboration and scaling become costlier. A unified European corporate framework would address this deficit by creating a single, recognisable standard that allows companies to remain locally embedded within a Member State while operating at continental scale. Such a corporate structure is not a peripheral administrative choice, but a foundational institutional layer.

Europe has long excelled at producing scientific excellence, technical talent, and ambitious founders. Yet it consistently underperforms in transforming these advantages into globally scaled companies headquartered and growing within the Union. While capital is formally free to move across Member States, in practice it remains segmented along national legal lines. Each funding round, shareholder agreement, or governance decision introduces jurisdiction-specific complexity depending on the Member State of incorporation. Over time, these frictions compound, nudging Europe’s most promising companies toward incorporation regimes outside the EU that offer clarity, predictability, and speed.

The limitations of local harmonisation efforts lie in both their scope and their method. Adjusting discrete elements of company law through EU directives, while politically feasible, addresses only fragments of the corporate lifecycle and inevitably permits divergent national interpretations across Member States. Partial harmonisation cannot deliver the level of legal certainty required by companies that depend on international capital, rapid execution, and cross-border scalability. The resulting market outcome is predictable: the most ambitious companies concentrate in a small number of jurisdictions with fully standardised and globally understood corporate regimes, while EU Member State jurisdictions remain comparatively fragmented.

Against this backdrop, the proposal for a pan-European corporate form, EU-INC, has emerged and represents a qualitatively different solution to 28th regime. Its principal strength lies in its greenfield nature. Rather than retrofitting twenty-seven national corporate law systems into uneasy alignment, EU-INC can be designed from first principles to support cross-border scale within the Union.

EU-INC should be understood as a blueprint for a European corporate standard rather than a single branded legal form. It articulates the core design principles of a 28th regime for company incorporation: a voluntary, pan-European corporate framework grounded in uniform rules, recognised across all Member States, and supported by a centralised registry. Such a registry is not merely administrative infrastructure, but a constitutive element of the regime itself. A single point of incorporation and public record is essential to ensuring legal certainty, recognisability, and investor trust across borders. Without a centralised registry, a 28th regime risks reproducing fragmentation through parallel national implementations.

Importantly, EU-INC is not an abstract academic construct or a top-down regulatory initiative. It has emerged as a legislative proposal developed by innovators for innovators, backed by the European startup and venture capital ecosystem, and shaped in close collaboration with practitioners. Founders, venture investors, and law firms specialising in venture capital and high-growth companies have contributed to its design, ensuring that the proposed regime reflects real market practice rather than theoretical compromise.

Crucially, EU-INC would not displace national corporate forms within Member States. Instead, it would operate alongside them as an optional regime for companies with cross-border ambition. This approach is consistent with the logic of the European single market, which does not mandate uniformity but seeks to remove barriers to scale. Unlike partial harmonisation, however, a true 28th regime creates certainty at the level that matters most: the corporate entity itself. Without such certainty, companies that require speed and international capital will continue to self-select into a narrow set of non-EU jurisdictions that already provide it.

For EU-INC to be credible, however, it must meet demanding criteria. First, it must provide corporate governance rules that are immediately recognisable to global investors. This includes clear fiduciary duties, enforceable minority shareholder protections, and predictable dispute resolution. Second, it must allow flexible capital structures, including multiple share classes, option pools, and convertible instruments that reflect established market practice in venture financing. Third, the regime must offer legal certainty in moments of stress, with restructuring frameworks that prioritise value preservation and continuity over punitive liquidation. Fourth, employee participation, particularly equity-based compensation, must be simple, portable, and interoperable across Member States. These elements are not ancillary features; they are preconditions for adoption by companies that rely on speed, scale, and international capital.

EU-INC must also be administratively light. Digital incorporation, standardised documentation, and a single regulatory interface are prerequisites for competitiveness. The objective is not merely harmonisation, but the creation of a corporate experience that is measurably superior to existing alternatives.

Standardising incorporation at the European level would generate important second-order effects. By lowering the friction of company formation and scaling within the Union, Europe would create more companies, faster, and with greater momentum. A shared corporate standard acts as a coordination mechanism: investors know what they are investing in, founders know what they are building, and talent understands the incentives on offer. This density of activity reinforces itself, improving valuations, deepening markets, and increasing the likelihood that globally significant companies are built and scaled from Europe rather than incorporated elsewhere. While capital markets reform remains essential, corporate structure is the factory floor on which companies are produced.

The broader implications of a pan-European corporate standard extend beyond venture capital. By establishing a recognisable and trusted institutional form, Europe signals confidence in its capacity to compete at scale. Over time, such a regime could exert upward pressure on national systems through voluntary convergence rather than imposed harmonisation.

The 28th regime reframes the question Europe must answer. Rather than asking how to manage fragmentation across Member State jurisdictions, it asks how to replace it with a standard. In a global economy defined by mobile capital and talent, this distinction is decisive. A pan-European corporate standard would not merely simplify incorporation; it would redefine the conditions under which Europe’s most ambitious companies choose to grow.

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Iwona Biernat is the Chief Operating Officer of Project Europe.

This blog is based on a discussion which took place at the Fifth LawFin Workshop, Building Europe’s Venture Capital Market: Contractual Transplants, National Challenges, and the Road to a Pan-EU Regime, held online in December 2025.  Visit the event page to explore more conference-related blogs.

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