WASHINGTON—In response to the European Commission’s proposal to create a so-called “28th regime” for Europe—a single, harmonized set of corporate rules that European companies can choose instead of having to navigate corporate registrations in multiple nations—ITIF released the following statement from Stephen Ezell, vice president of global innovation policy:
The Commission’s “28th regime” is a long-overdue step toward fixing one of Europe’s most persistent structural weaknesses, market fragmentation, which costs Europe an estimated 10 percent of its potential GDP annually. For too long, European firms, especially startups, have been forced to scale across borders as if they were entering entirely different countries each time. Having to register companies in multiple nations is especially onerous for small European businesses. In one recent study, nearly 60 percent said regulatory obstacles and administrative burdens were their greatest challenge.
If implemented well, this could move Europe from a patchwork of national markets to something closer to a true single market where companies can start, grow, and compete at continental scale from day one. But simplifying company registration is only one piece of the puzzle. Europe must rein in its increasingly heavy-handed regulatory approach, as many firms still face a broader compliance burden that slows innovation and scale.
At a moment when Europe is struggling to keep pace in advanced-technology industries, the continent needs to take every possible step to bolster its competitiveness and reduce regulatory friction.
Contact: Austin Slater, [email protected]
