The proposal aims to facilitate cross-border companies' operations and to increase business transparency and trust by making more information about companies publicly available at EU level. It will also cut red tape for cross-border businesses, saving around €437 million of administrative burden per year, thanks to an EU Company Certificate or the application of the “once-only principle”. The proposal will contribute to further digitalisation of the single market and help companies, in particular, small and medium-sized ones to do business in the EU.
Cutting red tape and administrative burden
To cut red tape and alleviate the administrative burden for cross-border business, the proposed rules include:
- Application of the “once-only principle” so that companies do not need to re-submit information when setting up a branch or a company in another Member State. The relevant information can be exchanged through the Business Registers Interconnection System (BRIS);
- An EU Company Certificate, containing a basic set of information about companies, which will be available free of charge in all EU languages;
- A multilingual standard model for a digital EU power of attorney which will authorise a person to represent the company in another Member State;
- Removing formalities such as the need for an apostille or certified translations for company documents.
Improving transparency and trust in cross-border business
The proposal is updating the existing EU rules for companies (Directive (EU) 2017/1132) to adapt them further to the digital developments and new challenges, and to stimulate growth and competitiveness in the single market.
To ensure greater transparency and trust in companies the proposed rules are intended to:
- Make sure that important information about companies (e.g. about partnerships and groups of companies) is publicly available in particular at EU level through the BRIS;
- Make searches for information about companies in the EU easier by allowing a search through BRIS and, at the same time, through two other EU systems interconnecting national beneficial ownership registers and insolvency registers;
- Ensure that company data in business registers is accurate, reliable and up-to-date, for example by providing for checks of company information before it is entered in business registers in all Member States.
The proposal will now be discussed by the European Parliament and the Council. It is proposed that once adopted, Member States will have two years to transpose the Directive into national law.
For More Information
European Commission press release
Questions and Answers: Commission proposes to expand digital tools in EU company law
Webpage - Company law and corporate governance
Proposal for a Directive to further expand and upgrade the use of digital tools and processes in company law
Annex – Proposal for a Directive to further expand and upgrade the use of digital tools and processes in company law
- Publication date
- 29 March 2023
- Representation in Ireland