A lively clash unfolded in the European Parliament plenary on January 19, 2026, centering on the foundational structure and accessibility of the proposed "28th Regime"—an optional, unified corporate form aimed at supporting innovative companies across the EU. The key confrontation was between Axel Voss (EPP) and René Repasi (S&D) over whether the regime should be established via a binding regulation or a directive. Voss and other proponents of a regulation—including Damian Boeselager (Greens/EFA) and Sven Simon (EPP)—argued that a regulation was essential to prevent divergent national implementations and ensure true harmonisation. In contrast, Repasi championed a fully harmonised directive as a pragmatic and legally feasible option, focusing on substance over form with a view to swift adoption. This cleavage highlighted the broader debate about EU powers versus national sovereignty, with regulation seen as centralising and directive as preserving some national discretion.
Opposing views also emerged on who should be eligible to use this new corporate form. Ondřej Krutílek (ECR) and Ilhan Kyuchyuk (Renew) pushed for inclusive access for all companies, while actors like Leila Chaibi (The Left) voiced concerns that the regime could undermine high national labour standards and predominantly benefit multinational firms. This raised questions about regulatory safeguards and worker protections in the innovative economy.
The debate took place at the European Parliament plenary session, part of preparations for an upcoming Commission legislative proposal due in March 2026. Michael McGrath (Commission) supported Parliament’s report and confirmed the Commission’s intent to roll out a harmonised framework with robust worker protections and digital, fast-track procedures.
Many speakers gave concrete proposals: Repasi detailed a 48-hour digital company setup target through a directive, while Boeselager championed a fast-track regulation dubbed a "speed boat" approach to swiftly meet entrepreneurial needs. Several called for digitalisation and simplified procedures as crucial to reducing red tape and stimulating scale-ups. Conversely, some voices like Chaibi and Schaller-Baross focused on political and social concerns rather than precise numeric targets or budgets.
Policy orientations crystallize around the cleavages of increasing or preserving EU powers (regulation vs directive), inclusion scope (all companies vs startups only), and worker protection (higher harmonised standards vs risk of legal loopholes). Proponents of strong harmonisation foresee greater uniformity and reduced compliance costs for cross-border business, benefiting innovative firms and potentially European consumers through enhanced competition. Meanwhile, opponents warn of risks to national labour models and call for safeguards to prevent social dumping or tax avoidance.
Impacts vary: the 28th Regime would notably affect EU producers and startups by lowering administrative barriers and potentially accelerating market entry. National authorities might face constraints in exercising full control over company law, while EU civil society groups remain concerned about the balance between innovation and social welfare. EU regulatory bodies will be tasked with supervising and ensuring compliance, balancing innovation encouragement with worker protection mandates.
The expected follow-up involves the Commission’s March legislative proposal, which will likely seek to find middle ground balancing Parliament’s ambition and pragmatism, while ensuring the framework is both legally feasible and politically acceptable. If successfully implemented, the 28th Regime could mark a significant step toward deeper EU internal market integration for innovative companies, though debates over the precise legal instruments and social safeguards are poised to continue.