EU Inc.: the single market’s first digitally native corporate form

FROM UNCITRAL SOFT LAW TO THE EU INC.: EUROPE’S SUPRANATIONAL LEAP TOWARDS HARMONISED DIGITAL COMPANY LAW FOR 21ST-CENTURY SMEs AND E-COMMERCE

By Antonio Tejeda Encinas, SJD / Dr. iuris in European Union Law | International Observer at Working Groups I (MSMEs/SMEs) and IV (Electronic Commerce) of the United Nations Commission on International Trade Law (UNCITRAL), through the Inter-American Bar Association (FIA/IABA, Washington DC). He has taken part in sessions held at the Vienna International Centre and at United Nations Headquarters in New York.

On 18 March 2026 the European Commission put forward its proposal for a Regulation, COM(2026) 321 final, entitled “Proposal for a Regulation of the European Parliament and of the Council on the 28th Regime Corporate Legal Framework – ‘EU Inc.’”.

This initiative is not just another technical adjustment to the EU company law acquis. It creates a new, optional type of company – the EU Inc. – conceived as a genuine “28th regime” running alongside the 27 national legal systems: a fully digital limited liability company, harmonised at supranational level and designed to operate across the single market without legal friction.

Its structural features are both ambitious and practical: incorporation entirely online in under 48 hours and for less than €100; flexible capital (potentially with no mandatory minimum); fully dematerialised shares held in a digital register kept by the company itself; and extensive use of the European Digital Identity Wallet (EUDIW) and the Business Registers Interconnection System (BRIS).

The proposal responds directly to the diagnosis in the Letta (2024) and Draghi (2025) reports, which identify the fragmentation of company law as one of the main hidden costs of the single market and as a key factor pushing European startups towards more agile jurisdictions such as Delaware. When two reports of that calibre reach the same diagnosis, we are no longer dealing with an academic hypothesis but with a clear signal of where regulation is heading.

What is genuinely new is not merely the introduction of another corporate form but the structural shift it entails: for the first time, the European Union is not simply harmonising existing national categories but creating a corporate regime of its own, designed from the outset as the digital legal infrastructure of the single market.

I. The EU Inc. proposal: a supranational regime that is digital by default

The EU Inc. is a limited liability company with its own legal personality and automatic recognition in all 27 Member States. Its key features are:

• 100% digital incorporation: a harmonised form, a qualified electronic signature (eIDAS 2.0) and integration with the EUDIW. The “once-only” principle allows data to flow automatically via BRIS.
• Flexible capital: no mandatory minimum in many cases, with creditor protection based on actual solvency and directors’ liability.
• Dematerialised shares: a digital register kept by the company itself, technology-neutral and compatible with DLT infrastructure.
• “Born digital” governance: electronic procedures for amendments to the articles of association, general meetings, mergers and simplified liquidation.
• Main legal basis: Article 114 TFEU, which allows it to be adopted by qualified majority.

Unlike the Societas Europaea (designed for large groups), the EU Inc. is digital-first and aimed particularly at startups, scale-ups and SMEs that naturally operate across borders.

II. UNCITRAL as the conceptual foundation: technological neutrality and functional equivalence

Since 1966 UNCITRAL has been the UN’s main forum for modernising international trade law. Two principles have guided its work: technological neutrality and functional equivalence between paper-based and electronic media.

Two instruments are particularly relevant:

1. The Model Law on Electronic Transferable Records (MLETR, 2017) – Articles 10 and 11 – which recognises that an electronic record is equivalent to a paper one where it guarantees uniqueness, integrity and exclusive control.

2. The Legislative Guide on Limited Liability Enterprises (2021), produced by Working Group I (MSMEs), which recommends simplification, capital flexibility and digital governance to lower the barriers facing micro and small businesses.

UNCITRAL produces soft law: global legal coherence, but no binding force and no common infrastructure.

III. The European leap: from soft law to supranational hard law with infrastructure

This is where Europe stands apart: its ability to turn international principles into directly applicable rules, backed by real operational infrastructure (BRIS, EUDIW, eIDAS 2.0).

The EU Inc. is the clearest example: UNCITRAL supplies the transnational legal grammar; the European Union supplies uniform enforceability within the single market.

IV. Functionally convergent elements

• Dematerialisation of shares: the MLETR’s functional equivalence.
• Capital flexibility: recommendations from the 2021 Legislative Guide for MSMEs.
• Identity and digital procedures: European implementation of technological neutrality.

The difference lies not in the principles but in the institutional capacity to make them work at continental scale.

V. International comparison and national fit

The EU Inc. aims to play a role in Europe similar to that of Delaware in the United States, but with the advantage of automatic recognition across 27 legal systems. Estonia and Singapore offer advanced models, though confined to their national scope; the EU raises them to the scale of the single market.

Challenges of fitting it into national law remain (transfers on death, rights in rem, AML checks). The principle of the primacy of EU law will be key. According to the Impact Assessment, administrative savings could reach €2 billion a year.

VI. Implications for SMEs and cross-border e-commerce

The EU Inc. drastically reduces the costs of incorporation and of scaling across borders. It facilitates pan-European investment, crowdfunding, the tokenisation of shares and digital arrangements compatible with the GDPR and the European regulatory ecosystem.

Therefore:

The EU Inc. closes a cycle decades in the making: the principles of technological neutrality and functional equivalence developed at UNCITRAL find in Brussels the institutional capacity to become a uniform, directly operational regime.

From the soft law of Vienna and New York to the digital hard law of the single market. When international commercial law meets supranational law-making power and common infrastructure, it stops being a theoretical exercise and becomes a real competitiveness tool for 21st-century European SMEs.

Main sources:

• COM(2026) 321 final, 18 March 2026.
• Impact Assessment SWD(2026) 322 final.
• UNCITRAL MLETR (2017) and Legislative Guide on Limited Liability Enterprises (2021).
• Letta (2024) and Draghi (2025) reports.