The European Union wants to make it easier for startups to build, grow, and scale across Europe. On October 3, 2025, European Commission President Ursula von der Leyen announced a plan to introduce uniform rules for startups across all EU member states. The new framework, which she called a “28th regime”, will allow startups to follow a single set of rules instead of dealing with different national laws in every country.
Von der Leyen said the goal is simple — to help European founders grow faster without legal roadblocks. She pointed out that Europe creates many startups every year, but too few of them scale up into global companies. The EU wants to fix that by creating a single digital and legal space for startups.
Why the EU Needs a Common Startup Framework
Europe has strong research centers, skilled engineers, and a growing pool of innovators. However, startups often struggle when they try to expand beyond their home country. Each EU nation has its own legal, tax, and labor systems. This makes it difficult for a small company to operate across borders.
For example, a startup in Germany must follow one set of labor laws, while a startup in France must follow another. If that German startup opens an office in Spain, it faces a new set of taxes and compliance rules. This complexity slows down growth and drains resources.
The European Commission believes uniform rules will cut red tape and encourage more cross-border collaboration. The new system will give startups a single set of legal requirements across the 27 EU nations. Founders can register their company once, comply with one rulebook, and expand anywhere in the EU.
What the “28th Regime” Means
The “28th regime” is a special legal option that exists alongside national laws. It does not replace local systems but gives startups an alternative path. A founder can choose to register under this EU-wide regime and gain the right to operate freely across all member states.
The plan covers business registration, taxation, digital operations, and data protection. The Commission also wants to simplify cross-border hiring by creating unified rules for digital employment contracts and remote work.
Von der Leyen said this regime will also connect with Europe’s Digital Single Market, so startups can use a single digital identity, payment gateway, and compliance dashboard. This means a founder in Portugal can manage a company that sells in Germany, Italy, and Finland — all through one system.
How the Plan Helps Founders and Investors
The uniform rules bring several benefits for entrepreneurs and investors:
- Faster Market Entry
Startups can launch and expand in new countries faster because they no longer need to handle separate registrations or licenses. - Lower Legal Costs
Founders can save thousands of euros on lawyers, consultants, and compliance audits. This money can go toward hiring or product development. - Easier Fundraising
Investors often avoid startups that operate under many different legal systems. A single EU regime makes valuations and risk assessments simpler. - Stronger Confidence
Uniform rules increase investor trust because all startups follow the same standards for accounting, governance, and data protection. - More Cross-Border Talent Mobility
Startups can hire employees from any EU country under the same contract structure, which encourages remote and hybrid teams.
The European Investment Bank (EIB) and several venture capital groups have already welcomed the move. They said this plan will make Europe more attractive for startup funding and innovation projects.
Building Europe’s Innovation Ecosystem
Von der Leyen emphasized that Europe must compete globally in technology and innovation. The U.S. and China host most of the world’s biggest startups. Europe has creative minds but often loses them to bigger markets due to complex regulations and limited funding.
To address this, the EU plans to launch a Startup Europe Growth Fund in 2026. The fund will pool resources from member states, the EIB, and private investors to provide early-stage and growth capital. The Commission also aims to link the new startup framework with Horizon Europe, the EU’s €95-billion research and innovation program.
The EU wants to create an environment where startups can innovate in fields like artificial intelligence, climate tech, clean energy, and biotechnology. The goal is not just to support founders but also to strengthen Europe’s economic independence in key technologies.
Voices from the Startup Community
Many European founders welcomed the announcement.
Marie Dubois, founder of a French fintech startup, said, “When we expanded to Germany, we spent six months dealing with legal paperwork. If these rules come into effect, it will save founders so much time.”
Lukas Weber, who runs a health-tech company in Austria, said, “This will level the playing field. U.S. startups can scale across 50 states easily, but in Europe, each border slows you down. We need this change.”
Venture capital firms also see potential. Elena Rossi, a partner at a Milan-based VC fund, said, “Investors love clarity. A unified rulebook gives us that. It reduces risk and speeds up deals.”
However, some experts warned that the EU must ensure the regime stays simple and optional. Too much central control could create another layer of bureaucracy. Startups should have the freedom to choose between national systems or the EU regime depending on their needs.
Challenges Ahead
Even though the idea looks promising, implementation will take time. Each member state must agree on the plan, and that often means long negotiations. Some countries may want to keep control over their national business laws, especially those related to taxation and labor.
The European Parliament and the Council must review and approve the proposal. If approved, the new rules could start rolling out in 2026.
Experts also said that technology infrastructure must support the plan. The EU will need strong digital platforms to manage registrations, tax filings, and compliance tracking securely across all countries.
A Step Toward a True Single Market
Europe already has the world’s largest single market for goods and services, but startups often feel excluded from its benefits. The new plan bridges that gap. It aims to create a Single Market for Startups — a zone where founders can think European from day one.
This move could unlock more innovation across borders, create millions of jobs, and help Europe build its own global champions in tech, clean energy, and science.
Von der Leyen said during her address, “Europe has the talent, ideas, and drive. Now it needs a system that helps these ideas grow here at home.”
Conclusion
The EU’s decision to create uniform startup rules marks a major step toward a more integrated innovation economy. It gives European founders the freedom to dream bigger and expand faster without the burden of complex regulations.
If the “28th regime” works as planned, it will transform Europe from a patchwork of startup scenes into a single, dynamic innovation zone. Founders will move ideas from Paris to Prague or from Lisbon to Berlin without losing time or money on legal barriers.
The initiative shows that Europe finally recognizes startups not just as small businesses but as the engines of the next generation economy.
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