Startup Portugal shares its 28th Regime vision

Startup Portugal welcomes the European Commission’s Public Consultation on the 28th Regime — a proposed single, harmonized set of rules for innovative companies throughout the EU — and shares its perspective on how the initiative could best support European startups and scaleups.

Two Essential Dimensions for the 28th Regime

Startup Portugal argues that the European legislator should focus on two core dimensions:

1. Creation of an optional new and harmonized company type: The new regime should remove barriers to the internal market and optimize scalability for European startups and scaleups.
2. Harmonized administrative rules: The legislative act should simplify procedures and encourage global investment through centralized, digital, and bilingual administrative processes.

Optional New Company Type

Startup Portugal recognises the challenge of defining mandatory material criteria (e.g., size, innovation, scalability) for companies to opt for the new company type. Therefore, it recommends that the company type be available to any company in any EU Member State.

However, the initiative should also:

• Create a clear European startup and scaleup definition.
• Design certain aspects of the regime — such as stock option frameworks — for preferential application to startups and scaleups.
• Tailor rules to the core needs of these companies, including symbolic minimum share capital, flexible general meeting rules, and admissibility of non-voting shares.

Harmonized Administrative Rules

The European legislator must harmonize and centralize administrative obligations. This involves:

• Simplifying obligations for companies and their representatives in interactions with Public Administration.
• Establishing common, digital, and bilingual procedures.
• Centralizing information in a European administrative entity operating closely with national authorities.

Key Recommendations by Startup Portugal

Considering both dimensions, Startup Portugal recommends that the European Commission’s initiative should:

1. Enable full centralization and digitalization of company registrations, including common procedures for corporate acts.
2. Adopt a harmonized corporate law framework covering general meetings, share categories, shareholder rights and duties, management rules, financing instruments, and supplementary contributions by shareholders.
3. Establish a harmonized regime for stock options with consistent accounting, defined employee rights, and favorable tax treatment.
4. Harmonize tax rules for capital increases to incentivize investment.
5. Standardize future equity subscription instruments, such as SAFE agreements, ensuring capital inflows are accounted as equity.
6. Implement specialized, preferential dispute resolution mechanisms under the 28th Regime in each Member State.

Through these measures, Startup Portugal believes the 28th Regime can foster innovation, attract investment, and make the EU a more competitive environment for startups and scaleups.