What Will The EU Inc. Proposal Mean For The Fintech Industry? Experts Discuss

The European Commission has presented EU Inc., a single corporate rulebook that companies can choose instead of dealing with 27 national systems and more than 60 company forms. For fintech founders, that legal complexity has often made EU market entry tricky and it has increased legal bills. EU Inc. creates one solid framework for the whole Union.

To recap, in the proposal, a company can register within 48 hours, fully online, at a maximum cost of €100 and with no minimum share capital. The Commission says founders will submit their information once through an EU level interface connecting national registers. A central EU register will follow in a second phase.[…]

[…] Fabio Coco, Partner ADVANT Nctm: "The Commission unveiled the EU Inc. proposal on 18 March: it falls short of what the financial sector urgently needs to accelerate innovation and it does not offer any form of ‘fintech passport’ or a genuine ‘single license’ for financial services. 

At this stage, the ‘EU Inc.’ proposal, seems to be a missed opportunity for innovation in the financial sector: the absence of an EU-wide regulatory sandbox or ‘safe harbor’ provision is a notable omission. Such an environment is vital for testing innovative financial services under a reduced regulatory burden without compromising market integrity. By deferring to existing national frameworks, the proposal misses a critical opportunity to lower the high barriers to entry in the banking, insurance, and financial sectors. This lack of centralised ambition risks curbing the competition and innovation the initiative was intended to foster.

In contrast, the progress made by the Italian Supervisory Authorities serves as a robust benchmark. Facilitated by a forward-thinking legislative approach, Italy successfully implemented a national regulatory sandbox. This controlled environment allows supervised entities and Fintech operators to test technologically innovative products and services within the banking, financial and insurance sectors for a defined period – a model that provides the clarity and flexibility currently missing from the broader EU proposal". […]

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