EU-INC: What the new European company framework actually means for remote workers
The European Commission's announcement of EU-INC in January 2026 sparked immediate excitement among remote workers and digital entrepreneurs. A pan-European company you can incorporate in 48 hours for under €100? It sounds transformative, maybe even too good to be true. But before we get carried away, let's examine what this proposal actually offers – and what it conspicuously does not.
The EU-INC framework represents the boldest attempt yet to create what policymakers call a "28th regime" – an optional EU-wide legal form that exists alongside, rather than replacing, the 27 national company structures. For those of us who've spent years navigating the patchwork of European business regulations, this is genuinely significant. But significance and solution are not the same thing!
What the Commission actually proposed
In January 2026, the European Commission unveiled its vision for EU-INC as part of a broader competitiveness agenda. The headline features (as currently described rather than fully legislated) are undeniably appealing:
Digital incorporation in 48 hours – no notary visits, no in-person requirements
Cost under €100 – compared to thousands in some member states
Single set of rules – one company law framework valid across all 27 countries (could it be?)
Opt-in structure – businesses choose EU-INC; it doesn't replace national forms
SME focus – explicitly designed for small and medium enterprises, not multinationals (unlike formation in some EU companies, for example Spain, where it's very difficult to form a limited liability company as a solopreneur.)
The legislative proposal is expected in March 2026, with optimistic projections suggesting the first EU-INC companies could be incorporated in 2027. That timeline alone should temper expectations – we're discussing something that doesn't exist yet, and won't for at least a year, assuming everything goes smoothly. In EU legislative terms, "smoothly" is doing a lot of heavy lifting here, and we need to recognise the political context in which this announcement was made - a time of pressure for the EU to stand united as a bloc in economic as well as political terms.
Why this matters for European integration
So before jumping into the practical implications, we should unpack what EU-INC represents politically. The single market has always been an incomplete project. Goods move freely; services less so. Capital flows across borders; companies remain stubbornly national.
For decades, this fragmentation has been both a feature and a bug. National company laws reflect national traditions, protect national interests, and create national barriers to entry. A German GmbH operates under different rules than a French SARL or an Estonian OÜ. Harmonisation efforts have repeatedly stalled.
EU-INC sidesteps this impasse with an elegant solution: don't harmonise, just add an alternative. Businesses that want pan-European simplicity can opt in. Those who prefer national structures can continue as before. It's the same logic that makes the euro work – sort of – if it had opt-outs for those who prefer their own currencies.
Whether you see this as pragmatic incrementalism or insufficient ambition depends on your view of European integration. But for those of us who believe a stronger, more unified Europe benefits everyone – including remote workers who've built careers on the free movement the EU enables – EU-INC represents a meaningful step forward. Not because it solves everything, but because it demonstrates that progress remains possible.
What EU-INC actually solves
Let's be clear about the genuine problems this framework addresses:
Cross-border incorporation friction
Currently, setting up a company in another EU member state requires navigating that country's specific requirements – often in the local language, with local advisors, meeting local formalities. For a Spanish resident wanting to incorporate in the Netherlands, or a Portuguese digital nomad considering an Irish structure, the barriers are real and costly.
EU-INC would create a single pathway. Same process, same requirements, same outcome regardless of which member state hosts your incorporation. That's genuinely valuable.
Administrative complexity for multi-country operations
Businesses operating across borders currently juggle multiple regulatory frameworks. An EU-INC structure – if implemented well – could simplify reporting requirements and reduce the overhead of maintaining compliance across jurisdictions.
Credibility and recognition
A standardised EU company form could carry weight that some national structures lack. Whether dealing with banks, clients, or partners in other member states, "EU-INC" might communicate legitimacy more effectively than an unfamiliar national entity type.
B2B invoicing and contracts
Cross-border invoicing between EU entities should become more straightforward when both parties operate under the same legal framework. Contract disputes could reference a single body of EU company law rather than navigating conflicts between national systems. It would also provide a useful framework for founders who are residents and nationals in different EU states.
What EU-INC does not solve
Here's where remote workers, freelancers, and digital nomads need to pay close attention. EU-INC addresses company law.
It does not address:
Employment law remains local
You cannot use an EU-INC company to employ yourself in a way that circumvents the employment law of the country where you actually work. If you live in Spain and work from Spain, Spanish employment law applies to you – regardless of where your company is incorporated.
This is the fundamental misunderstanding that trips up many location-independent workers. Company jurisdiction and employment jurisdiction are different things. EU-INC changes nothing about this.
Tax residence still follows substance
Your company's tax residence will continue to be determined by where it has genuine economic substance – where decisions are made, where management meets, where business actually happens. Incorporating an EU-INC company will not magically shift your personal tax obligations.
The same permanent establishment rules that apply today will apply to EU-INC companies. If you manage your EU-INC company from your apartment in Lisbon, Portuguese tax authorities will surely have plenty to say about it.
Social security coordination unchanged
The complex web of bilateral agreements and EU regulations governing social security contributions remains entirely untouched by EU-INC. Where you pay social contributions, what benefits you're entitled to, how periods in different countries are aggregated – all of this continues under existing frameworks. Or maybe some new framework will be developed, because this is fundamental to the application of the programme surely... but right now it doesn't exist.
Payroll complexity unchanged
If you want to hire employees in multiple EU countries, EU-INC doesn't help. You'll still need local payroll arrangements, local employment contracts, and compliance with local labour law in each country where you have staff.
This could also have visa qualification implications as well, (unless something really exciting happens to bring us an EU-wide digital nomad visa one day.)
For example, under the Spanish digital nomad visa, you have to be employed, or generate at least 80% of your income if self-employed, from a business entity outside of Spain. What if your employer is an EU-incorporated business, though? Will that be counted as ineligible for DNV purposes, or will EU-wide businesses be treated as foreign for this purpose?
There's still a lot to work out, and it will affect many location-independent freelancers and micro-businesses.
EU-INC vs Estonian e-Residency
The comparison is inevitable. Estonian e-Residency has been the go-to option for location-independent Europeans wanting a clean, digital-first company structure. How does EU-INC compare?
| Aspect | Estonian e-Residency | EU-INC (proposed) |
|---|---|---|
| Available now | Yes, since 2014 | 2027 at earliest |
| Company type | Estonian OÜ (private limited) | New EU-wide form |
| Incorporation speed | 1-2 weeks typically | 48 hours (promised) |
| Cost | ~€200-500 with service providers | Under €100 (promised) |
| Tax treatment | Estonian corporate tax rules | Unknown – likely varies |
| Track record | 10+ years, proven ecosystem | None – entirely theoretical |
| Banking | Challenging but established options | Unknown |
| Service provider ecosystem | Mature (Xolo, Companio, etc.) | Non-existent |
The honest assessment: Estonian e-Residency works. It has rough edges – banking remains challenging, the tax treatment requires careful management, and you still face the same substance and PE questions – but it's real, tested, and supported by a functional ecosystem.
EU-INC is a proposal. It might be excellent. It might be watered down during legislative negotiations. It might face implementation problems that take years to resolve. We simply don't know.
What about EORs and freelance platforms?
If you're currently working through an Employer of Record or a freelance platform that handles your compliance, EU-INC changes very little for you.
EORs exist because employment law is local and complex. EU-INC doesn't address employment law. The value proposition of having someone else handle payroll, benefits, and compliance in a specific country remains entirely intact.
Similarly, platforms like Remote, Deel, or Oyster solve problems that EU-INC doesn't touch. If anything, the existence of EU-INC might slightly simplify how these platforms structure their own operations – but that's several steps removed from your experience as a worker.
The realistic timeline
Let's be honest about what comes next:
March 2026: Legislative proposal expected from the Commission
2026-2027: European Parliament and Council negotiations (historically takes 18-24 months minimum for significant legislation)
2027-2028: Transposition period if/when adopted
2028+: First actual EU-INC incorporations (optimistic)
And that's assuming political will holds, no major objections derail the process, and implementation goes smoothly. The EU has a track record of ambitious digital initiatives that face significant delays. The Common European Asylum System has been "coming soon" for over a decade.
Even once EU-INC exists legally, the practical ecosystem takes time to develop. Banks need to accept these entities. Service providers need to support them. Case law needs to establish how disputes are resolved. Accountants need to understand the tax implications. None of this happens overnight.
What remote workers should do now
Given all of the above, here's the practical advice:
Don't wait for EU-INC to solve current problems. If you need a company structure now, the existing options – national companies, Estonian e-Residency, or other established structures – are your choices. Making decisions based on theoretical future frameworks is a recipe for paralysis.
Existing solutions remain valid. Nothing about EU-INC invalidates current approaches. An Estonian OÜ incorporated today will continue to function. A Spanish S.L. or German UG doesn't become obsolete because EU-INC exists.
Follow the development, but skeptically. The proposal will evolve. Details matter enormously. The version announced in January 2026 may look quite different after legislative negotiations. Watch for substance, not headlines.
Consider your actual needs. Most remote workers don't need complex corporate structures. If you're a freelancer invoicing clients, the simplest compliant structure in your country of residence is often the right answer. EU-INC won't change that calculus.
Get proper advice for your situation. This article is not tax or legal advice. Your circumstances are specific. If you're making significant decisions about corporate structure, employment arrangements, or tax planning, work with qualified professionals who understand your particular situation.
Looking forward
EU-INC represents genuine progress toward a more integrated European business environment. For remote workers and digital entrepreneurs who've long navigated the friction between borderless work and bordered regulations, any simplification is welcome. As such, Remote Work Europe welcomes the proposals very much.
But it's not a revolution. It's not a solution to the fundamental complexities of cross-border work. And it's not available yet.
The remote work community has learned to be skeptical of announcements that promise transformation. We've seen digital nomad visas that don't address tax obligations, banking innovations that exclude non-residents, and harmonisation efforts that create new complexity while eliminating old.
EU-INC deserves cautious optimism. It addresses real problems. It represents political will toward integration. It might, eventually, make some things genuinely easier.
In the meantime, the practical work of building location-independent careers continues under the frameworks we have – imperfect, fragmented, but functional. That's the reality of remote work in Europe: navigating systems that weren't designed for us, while watching for genuine improvements.
EU-INC might be one of those improvements. We'll know more in a year or two. Until then, build with what exists.
This article provides general information about EU policy developments and should not be construed as legal, tax, or financial advice. Cross-border business structures involve complex regulatory considerations that vary based on individual circumstances. Consult qualified professionals before making decisions about company formation or tax planning.