EU Inc. versus Delaware

The debate on EU Inc. is now in full swing.

To each and every one of the 720 Members of the European Parliament: Europe and its Parliament have today an historic responsibility.

One Market One Law strongly supports President Ursula von der Leyen's EU Inc. proposal. It has the potential to become the most important step towards completing the Single Market in decades.

But let us be clear.

Unlike the United States, Europe is not a federation. A European Delaware is neither feasible nor desirable. That is not the purpose of EU Inc.

The objective is not to encourage regulatory competition or forum shopping. It is to provide companies with a single, optional and directly applicable European legal framework, while fully respecting national mandatory public-policy rules.

Forum shopping can and must be prevented without limiting the scope of EU Inc. and reducing its effectiveness to zero.

Europe already possesses the necessary legal concepts, from the genuine-link requirements governing the Societas Europaea to the case law of the Court of Justice on wholly artificial arrangements.

An EU Inc. must pursue a genuine economic activity. The pure letterbox, a company with no real activity anywhere, set up solely to escape the rules it should answer to, has no place in this framework.

Europe does not need a European Delaware.

Europe needs a genuine EU Inc. open to all, a single optional corporate law framework, a strong European financial market and at long last, 40 years after the Single Act, a really defragmented and efficient Single Market.