Setting up a company in the EU becomes easier and cheaper

New rules to facilitate establishing a business electronically and promote online operations throughout a company's lifecycle were approved by MEPs last Monday. The new rules aim to save businesses time and money, while increasing safeguards against fraud and abusive behaviour through online identity checks.

They provide improved online procedures, from setting up companies to registering their branches and filing documents; user-friendly information is provided on registration portals, free of charge and in a language broadly understood by a majority of cross-border users; “once-only principle”, meaning a company needs to submit information only once during its lifecycle; and transparent rules on fees, applied in a non-discriminatory manner, without exceeding the costs of providing such services.

Negotiators agreed that while all steps to set up a business can be completed online, it is also possible to request face-to-face interaction on a case-by-case basis. They also insisted on including the possibility to verify if persons applying for director positions are currently disqualified from such a position in another member state.

“Both institutions stayed committed to the common goal – to give European entrepreneurs a modern, safe and transparent environment to operate. However, we need to remember that this is just a first step. It is high time European entrepreneurs benefited from new technologies, especially in their cross-border activities. We must continue to cut red tape for SMEs and dismantle the obstacles that European businesses face in the common market,” rapporteur Tadeusz Zwiefka (EPP, PL) said.

The provisional agreement still needs to be confirmed by Coreper and by the Legal Affairs Committee. The directive will then need to receive a green light from the full House and the Council of the EU.

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