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Teema: * : Open letter on the 28th regime / EU Inc.: The Commission proposal must be withdrawn and profoundly revised following the…
Kuupäev: 2026-06-23 10:51
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Open letter on the 28th regime / EU Inc.: The Commission proposal must be
withdrawn and profoundly revised following the Council Legal Service Opinion
Brussels, 23 June 2026
* TO: Competitiveness Council
* TO: Permanent Representatives (Coreper II)
* TO: Deputy Permanent Representatives (Coreper I)
* CC: Social Attaches
Dear Ministers,
Dear Ambassadors,
We are contacting you with an urgent request following the assessment of the
Council Legal Service on the legal basis of the Commission proposal for a
28th regime / EU Inc.
The Council Legal Service has recently confirmed what trade unions have been
saying all along: the Commission proposal for a 28th regime / EU Inc. is
based on an incorrect legal basis.
If the co-legislators proceed on the basis of the current incorrect legal
proposal, a annulment by the CJEU will be likely.
This means that the Regulation will increase legal uncertainty and
litigation risks, and choosing the 28th regime / EU Inc. status would
constitute a high risk also for companies.
A likely annulment of the Regulation would mean immense costs and economic
damages, repeated changes to national systems and procedures, confusion for
companies, national and enforcement authorities and stakeholders.
The Commission did not base its proposal on Article 50 TFEU, which was used
in the past for company law legislation. The Commission relied on Article
114 TFEU, which is intended for harmonizing existing national laws, not to
create a parallel, optional regime. Also, Article 114(2) explicitly
prohibits using this legal basis for acts relating to the rights and
interests of employed persons. In addition, the Commission did not consult
social partners, as required under the EU Treaties, before presenting the
proposal, which would have been necessary considering the impact on working
people.
The Council Legal Service (CLS) concluded that the choice of the legal basis
(Article 114 TFEU alone) is incorrect, and that a Directive on the basis of
Article 50 TFEU would have been the appropriate legislative tool.
In its reasoning, the CLS pointed out the specific nature of Article 50 TFEU
for provisions whose main objective and content relate to the freedom of
establishment, as opposed to Article 114 TFEU. Most of the provisions in the
Commission proposal concern company law and should therefore be based on
Article 50 TFEU, in line with the Treaties (including Paragraph 2 of Article
50 TFEU), legislative practice and the case law of the Court of Justice. The
CSL correctly outlined that not a single piece of EU company law legislation
could be found that was not based on Article 50 TFEU.
The Council Legal Service also confirmed that if the 28th regime / EU Inc is
based on Article 114 TFEU, the risk of it being declared null and void by
the CJEU will be significant and high.
The importance of the opinion of the Council Legal Service cannot be
overstated.
It would be irresponsible and against better regulation principles for the
EU institutions to advance in the consideration of the Commission proposal
following the assessment of the CLS.
The ETUC calls once more on the Council not to allow the Regulation to
proceed in its current form.
The ETUC calls on the Council to:
* Publish immediately the Council Legal Service opinion;
* Ask the Commission to withdraw the proposal and revise it significantly to
make it legally sound and based on the correct legal basis, and to introduce
the necessary guarantees for workers' rights.
The speed at which the proposal is advancing only increases the risk of more
mistakes in drafting and all of the negative consequences that will flow
from that.
Trade unions will continue to follow closely the discussions and the
positions of the governments in the upcoming debates, and will hold to
account governments that will choose to risk legal certainty and the
solidity of EU and national legal systems against the advice of the Council
Legal Service.
Looking forward to your reply, we remain available for any further exchanges
on this very important matter.
Please find also attached our previous letter dated 15 May outlining our
strong concerns and opposition to the Commission proposal for 28th regime /
EU Inc.
Best regards,
Esther Lynch,
General Secretary of the European Trade Union Confederation
20260623
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_ Open letter on the 28th regime - EU Inc _ The Commission proposal must be
withdrawn and profoundly revised following the Council Legal Service
Opinion.pdf
20260515
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_ ETUC Urgent letter on the 28th regime - EU Inc proposal.pdf
_____
Fight
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