EU Inc has 100 days left, and the Baltics have more at stake than most

On 10 September, a group of Europe's most recognisable founders and investors published an open letter with an unusually blunt warning. EU Inc, the proposed European company statute, could still end up as "a legal structure so diluted that nobody uses it". The deadline the signatories are trying to hold policymakers to is now roughly one hundred days away.

This is not a fringe complaint. The signatories include Daniel Ek, Niklas Zennström, Miki Kuusi, Arthur Mensch of Mistral, and senior partners from Accel, Index Ventures, EQT and Atomico. The letter landed three days before this piece was written, so the negotiation it is trying to influence is very much live.

What EU Inc actually is

The European Commission presented its proposal on 18 March 2026, following a grassroots campaign that gathered more than 26,000 signatures from founders, investors and operators across European tech. The pitch is straightforward: one company form that works across all 27 member states, rather than a patchwork of national laws that each have to be navigated separately.

• A common corporate framework recognised across the Single Market.
• Digital incorporation in under 48 hours.
• More flexible company rules than most national codes currently offer.
• A European employee stock option scheme.

For anyone who has incorporated in one Baltic state and then tried to hire, pay or issue options in another, the appeal does not need much explanation.

Why the Baltics should care more than most

Estonia, Latvia and Lithuania are three jurisdictions with a combined population of roughly six million people. Nobody builds a software company on that alone. Founders in the region treat cross-border operation as the default rather than as an expansion phase, and the administrative overhead of doing so has been a running cost for two decades.

Estonia's e-Residency programme is the most visible workaround. It lets a non-resident register and administer an Estonian company remotely, which is genuinely useful, but it is also a national solution to a European problem. It does not create a company form that other member states automatically recognise, and it does not touch stock option taxation, which is set nationally. EU Inc is the attempt to fix the layer underneath.

There is a second reason the region should be paying close attention. The five provisions the letter defends map almost exactly onto the operational complaints Baltic founders raise repeatedly.

The five provisions now under pressure

• Free choice of registered office. A founder should be able to pick a corporate home in any member state without being required to base operations there. That is precisely the pattern Baltic teams already run, and it is the provision most likely to be carved up by national interests.
• Broad access. The statute should not be limited to "innovative companies", selected sectors, or arbitrary headcount and revenue thresholds. A company form that only some businesses may use will never become the standard that international investors learn to trust.
• One central registry. The campaign wants a single authoritative European register, not a search interface draped over 27 national databases, with harmonised KYC and beneficial ownership standards underneath it.
• Standardised stock options. Employees should be taxed when they dispose of shares rather than when options vest or are exercised, supported by a safe harbour valuation at grant.
• Local labour law and taxes. Employment protections should keep applying where people actually work, and tax should follow where economic activity happens. The letter is explicit that EU Inc is corporate law simplification, not a route around national obligations.

The stock option provision is the one to watch if you are hiring engineers in Tallinn, Riga and Vilnius onto the same team. Option tax treatment is not harmonised across the three countries today, which means an identical offer can be worth materially different amounts depending on where the recipient sits. Founders end up designing compensation around tax geography, which is a poor use of anyone's time.

The funding picture it lands in

The timing matters, because the reform is being negotiated into a market that is rewarding fewer companies with more money at the top while the middle of the pipeline thins out.

On the same day the letter went out, Antler published research covering 760 unicorn founders, 4,129 Series A founders and 81,055 funding rounds in Europe since 2000. The headline finding is uncomfortable: Europe is producing unicorns faster than ever while fewer and fewer companies make it past the earliest stages.

• Companies founded after 2020 reach unicorn status in about two years on average, against 7.2 years for those founded before.
• Seed to Series A conversion fell from 23.3 per cent between 2008 and 2019 to 13.1 per cent in 2022 and 9.3 per cent in 2023. Fewer than one in ten European startups now reaches Series A.
• The number of active pre-seed and seed investors is down 42 per cent since 2022. Series A investors are down 44.7 per cent.
• Antler estimates that restoring the earlier conversion rate would cost 2.74 billion dollars, roughly ten per cent of the capital raised by Europe's fastest-growing unicorns.

Monthly data points the same way. Tech.eu's tally for August 2026 recorded 3.2 billion euros across 165 deals, down about 63 per cent on July's 8.6 billion euros across 267 rounds. Artificial intelligence took 20.9 per cent of the month's total. Ten companies raised more than 100 million euros each, which is where a great deal of the money went.

Why the unicorn headline hides the problem

Antler splits the fast risers into two groups. Jets are lean, capital-efficient revenue machines. Juggernauts are capital-intensive deep tech companies in sectors such as defence, energy and frontier research. The two look almost nothing alike.

The founder profiles differ too. Juggernaut founders average 37 years old at founding, and 38.5 per cent hold PhDs. Jets founders average 31, and only 10 per cent hold doctorates. Around 45 per cent of Juggernaut founders are serial entrepreneurs. London is home to 43 per cent of Europe's rocketship unicorns, with Stockholm and Paris the other notable clusters.

For the Baltics this is a useful lens. The region's next cohort looks far more like Juggernauts than Jets. Defence technology, robotics, industrial software and health are capital-intensive and slow to scale, and they depend on patient money that has become harder to find in the middle of the market. A single European company form with a workable stock option scheme does more for that cohort than another consumer app success story would.

What founders can do before December

The negotiations are not a spectator sport, but the leverage available to an individual founder comes down to a few concrete moves.

• Model your cap table under the proposed option rule, where tax is due at disposal rather than at exercise, and compare it with what your current jurisdiction does. If the difference is large, say so publicly.
• Work out where you would incorporate under free choice of registered office. If the answer is not where you are today, that is a data point worth sharing with your national startup association.
• Check whether your sector would fall inside a restricted definition of "innovative company". Defence, robotics and industrial software founders have the most to lose from a narrow scope.
• Push for the central registry. A layer of interfaces over 27 national systems would leave the compliance burden roughly where it is now.

The deadline

The European Parliament's Legal Affairs Committee is due to consider amendments during September 2026, while member state representatives hold a series of technical negotiations ahead of a ministerial discussion at the Competitiveness Council later in the month. Once both institutions settle their positions, they negotiate a common final text. The stated ambition is an agreement before the end of the year.

That leaves roughly one hundred days. The letter's argument is that the difference between a genuine European company form and another optional layer that nobody adopts will be decided in that window, largely through technical amendments that attract almost no public attention.

For a region whose companies are cross-border out of necessity rather than ambition, that is a deadline worth watching closely.