The EU Inc. (European Incorporated Company) is a new pan-European company form proposed by the European Commission under Regulation COM(2026) 320. It allows entrepreneurs to incorporate a company valid across all 27 EU member states, entirely online, in 48 hours, for under €100.

When will the EU Inc. be available?

The regulation was proposed on March 18, 2026. It is currently being reviewed by the European Parliament and Council. Final adoption is expected in 2027, with the first EU Inc. companies possible by 2028.

How much does it cost to create an EU Inc.?

The maximum registration fee is capped at €100, with zero minimum capital requirement. This makes it the most affordable company form in Europe and possibly the world.

Is the EU Inc. valid in all EU countries?

Yes. Once registered, an EU Inc. is automatically recognized in all 27 EU member states without any need for re-registration or additional procedures.

Do I need a notary to create an EU Inc.?

No. The entire process is digital. Identity verification is done online, replacing traditional notarization. You can incorporate from anywhere with an internet connection.

What is Regulation COM(2026) 320?

COM(2026) 320 is the official reference number for the European Commission's legislative proposal establishing the EU Inc. company form. It was published on March 18, 2026.

Flexible Share Classes: How EU Inc Protects Founders

Share Structure Freedom for European Founders

One of the most overlooked but impactful features of the EU Inc is its flexible share class system. For the first time, European founders have access to a standardized, pan-European company form that supports the sophisticated equity structures previously available only through US incorporation or complex national workarounds.

What Are Share Classes and Why Do They Matter?

Share classes allow a company to issue different types of shares with different rights. This is critical for startups because it enables:

Founder control: Maintaining voting control even after significant dilution through funding rounds
Investor protection: Providing investors with preferential economic rights (liquidation preferences, anti-dilution) while founders retain governance control
Employee incentives: Creating share classes specifically designed for employee stock option plans (ESOPs)
Strategic flexibility: Adapting the company's equity structure as it grows and its needs change

Dual-Class Share Structures

The EU Inc explicitly permits dual-class share structures — a mechanism that has been instrumental in the success of companies like Google (Alphabet), Facebook (Meta), Spotify, and many other tech giants.

How It Works

Class A shares: One vote per share (typically held by investors and public shareholders)
Class B shares: Ten votes per share (typically held by founders)

This means a founder can retain majority voting control even while owning a minority of the company's economic interest. In practice, a founder with 15% economic ownership but Class B shares could still control over 60% of voting power.

Why This Matters for European Startups

Many European company forms have historically restricted or prohibited dual-class structures:

Germany (GmbH): All shares carry equal voting rights (one share = one vote). Workarounds exist but are complex and limited.
Italy (SRL): Similar restrictions, though the SRL Innovativa allows some flexibility
France (SAS): Allows different share classes — one of its key advantages
Netherlands (BV): Permits different share classes with some restrictions

The EU Inc standardizes dual-class availability across all 27 member states, eliminating the need for founder-unfriendly workarounds.

"Dual-class shares are not about giving founders unchecked power. They're about aligning long-term vision with governance control. The best companies are built by founders who can think in decades, not quarters," explained a partner at a leading European VC fund.

Anti-Dilution Protections

The EU Inc framework supports standard anti-dilution mechanisms that are essential for venture capital investment:

Weighted average anti-dilution: Protects investors from value destruction in down rounds by adjusting their conversion price
Full ratchet anti-dilution: More aggressive protection that reduces the conversion price to the new round's price (typically reserved for early investors in high-risk situations)

These mechanisms, while protecting investors, also benefit founders by making the EU Inc more attractive to institutional investors who might otherwise require a Delaware incorporation.

Liquidation Preferences

EU Inc articles can include liquidation preferences — a critical component of venture capital term sheets:

1x non-participating preferred: Investors get their money back first, then share in remaining proceeds on an as-converted basis
Participating preferred: Investors get their money back first AND share in remaining proceeds ("double dipping")

Having these structures available within a standardized EU-wide company form eliminates the need for complex contractual arrangements that vary by jurisdiction.

Employee Stock Options (ESOP)

The EU Inc is designed with employee equity participation in mind:

Dedicated share classes for employee options
Simplified vesting schedule implementation
Exercise mechanisms designed for digital execution
Compatible with national tax frameworks for employee equity (though tax treatment varies by member state)

Drag-Along and Tag-Along Rights

The standardized EU Inc framework includes provisions for:

Drag-along rights: Allowing majority shareholders to force minority shareholders to join in a sale (essential for clean exits)
Tag-along rights: Protecting minority shareholders by giving them the right to join any sale on the same terms (ensuring they're not left behind)

Comparison with Existing European Forms

Most Restrictive

German GmbH: Very limited flexibility. No dual-class without complex pool arrangements. Share transfers require notary.
Italian SRL: Limited share class options. Restrictions on transferability.

Moderately Flexible

Dutch BV: Allows different share classes but within Dutch legal constraints
Spanish SL: Some flexibility but with restrictions on share types

Most Flexible (Comparable to EU Inc)

French SAS: Excellent share class flexibility — the closest national form to what the EU Inc offers
UK Ltd (pre-Brexit): Highly flexible share structures — the benchmark that the EU Inc aims to match

Practical Impact on Fundraising

The EU Inc's share class flexibility has immediate practical benefits for fundraising:

VCs can structure investments using familiar terms (Series A preferred, etc.)
Cross-border investment is simplified — the same share structure works in all 27 member states
Term sheet negotiations are simpler because the underlying company form supports all standard provisions
Conversion from EU Inc share classes to public market structures is streamlined for future IPOs

Looking Ahead

The flexible share class system is perhaps the EU Inc feature that most directly addresses the European startup ecosystem's long-standing disadvantage versus the US. For too long, European founders have been forced to choose between founder-friendly equity structures (available mainly through US incorporation) and operating within the EU.

The EU Inc eliminates this false choice. European founders can now have both: sophisticated equity structures AND seamless EU market access. That combination could be transformative for European venture capital and innovation.