EU Inc. Signals a Shift: Why Immigration Will Matter to Europe’s New Corporate Agenda 

The European Commission launched its EU Inc. legislative proposal in March 2026 to create a single framework for company formation across the EU, aiming for agreement by the end of 2026.  

The initiative, known as the “28th regime”, would allow entrepreneurs to set up a company in any Member State within 48 hours, fully online and at low cost. It introduces a unified legal framework, a single digital business register and a “once-only” principle that removes the need to submit the same information across multiple jurisdictions.  

The proposal targets a long-standing gap in the single market. Despite free movement of goods and services, companies still face 27 different legal systems. Recent reports have highlighted how this fragmentation pushes European startups to relocate outside the EU, particularly to the US. 

What is EU Inc and Why it Matters  

EU Inc., developed with lessons learned from the failures of Societas Europaea, will allow any entrepreneur to register a company in any EU Member State within 48 hours, fully online, for under EUR 100 and with no minimum share capital requirement. This universal legal framework across all 27 member states enables, a single digital EU business register and a “once-only” principle, meaning companies submit information to public authorities once – not 27 times. It is called the 28th regime because it sits alongside existing national structures as an optional alternative, not a replacement. 

The Immigration Angle: More Questions Than Answers 

EU Inc. is a corporate law instrument. Employment law, social security contributions and labour protections remain tied to national frameworks in the country where the worker is located.   

Immigration systems also remain unchanged, including work authorisation frameworks, the ICT Directive and national authorities across the EU. 

What does change is the corporate entity itself. This may have downstream implications that are not yet fully mapped. 

Example: Intra-Corporate Transferees (ICTs) 

• The ICT framework underpins much of the EU’s highly skilled mobility system. It is based on the relationship between a non-EU employer, the receiving EU entity and the Member State of incorporation. EU Inc. entities will be able to move their registered office between Member States without dissolving and re-incorporating. This flexibility supports scaling businesses but raises questions about how ICT rules will apply in practice. There is no clear guidance yet. 

Companies are likely to increase intra-EU transfers and use more posted worker arrangements. This will add complexity across immigration and social security systems. 

A review of existing immigration and labour rules may be needed to ensure they support, rather than limit, the objectives of EU Inc. 

Cross-Border Work 

The Commission is exploring allowing 100% cross-border telework for innovative startups and scale-ups under a forthcoming Fair Labor Mobility Package. Cross-border telework at scale implies social security exposure, tax residency questions and work authorisation gaps, in every combination of Member States where the employee sits. Current rules do not easily facilitate securing work and residence permits if there is no entity in the jurisdiction in question. 

A Skills Portability Directive is expected in September 2026 focusing on, among other provisions, a simplification of procedures related to the recognition of professional qualifications, including a “once-only” principle for skills validation. This will have the welcome benefit of lessening the lengthy burden of complying with 27+ national frameworks. 

A Common European Business Register 

In the first instance, the EU will rely on an existing system connecting national business registers (BRIS) until a common central register is established. The concept of common business registers is a recurring theme in recent EU initiatives – for example, the EU Commission visa strategy proposal to develop a common list of verified companies to receive fast-track processing, facilitating procedures for trusted business travellers to the Schengen Area or the vetted employers registered to the EU Talent Pool to hire non-EU nationals in shortage occupations.  

The Talent Attraction Dimension 

EU Inc. companies will be able to set up EU-wide employee stock option plans, with taxation only triggered at point of sale. For semiconductor or high-tech companies competing globally for engineers, this is a structural improvement to the EU’s attractiveness as a destination. More companies choosing to scale from Europe means more international talent pipelines requiring work authorisation across Europe.  

There is currently no EU-wide pathway to attract entrepreneurial talent. Existing instruments, such as the EU Blue Card, are tailored to highly skilled employees in traditional corporate roles and explicitly exclude entrepreneurs. While about 16 Member States have introduced specific admission schemes targeting this group, the lack of harmonisation brings us back to a familiar challenge: fragmented conditions, varying processing times and inconsistent eligibility criteria for startup founders and entrepreneurial talent across the EU. 

Estonia’s e-Residency programme illustrates how national initiatives can fill that gap. Launched in 2014, it gives non-residents a digital identity to set up and manage an EU-based company online. Entrepreneurs can access the EU market and more than 2,700 digital public services without travelling to Estonia. However, e-Residency does not grant citizenship, physical residence or travel rights within Estonia or the EU. 

Predictions: No Immediate Silver Bullet 

Many founders, scale-ups and restructured multinationals may assume that cross-border movement became easier as a result of EU Inc., however, in practice, it has not. A pan-European corporate standard may redefine the conditions under which Europe’s most ambitious companies choose to grow, but it doesn’t redefine the conditions under which their talent crosses borders. Those frameworks still sit with the 27 member states. 

The uniformity of EU Inc may be eroded by national courts interpreting the Regulation through their own national lens. This means that a Netherlands EU Inc will be different to a Belgian Inc, just across the border.  

These corporate simplifications will create immigration complexity, because they change the entity structures that immigration frameworks are built around without updating the frameworks themselves.  

The companies that will feel this first are the ones restructuring under an EU Inc. framework and assuming their mobility programme can remain the same.  

What Employers Should Watch as EU Inc Develops 

The proposed 28th regime will need to demonstrate clear advantages to attract innovative companies from across the EU and beyond. It does not include EU-wide visa or immigration alignment and progress is likely to be gradual, through soft harmonisation, pilot programmes and EU directives.  

The EU Inc. proposal now moves to discussions in the European Parliament and the Council, with the European Commission aiming for an agreement by the end of 2026. The true test will be during tri-partite negotiations as to whether there is political will to deliver on corporate uniformity required for the EU to be competitive on the global stage. 

Need to Know More 

For businesses, startups and entrepreneurs interested in exploring future market entry opportunities in Europe, contact Knowledge Management Director Ana Sofia Walsh at [email protected] and Senior Client Engagement Manager Soraya Driessen at [email protected].  

This blog was published on 29 May, 2026 and reflects information available at that time. Updates may occur as policies evolve. To stay informed on the latest immigration news and analysis, please subscribe to our alerts and follow Fragomen on  LinkedIn, Facebook and Instagram.