EU start-up strategy: simplification, tax breaks, and Blue Cards for foreign entrepreneurs

Brussels – Simplification, tax incentives, quick timeframes — ideally 48 hours — to set up and register companies. Furthermore, a facilitated path to attract skilled labor and non-EU entrepreneurs to open their own companies in the EU through a fast track. In a nutshell, this is the European Commission’s strategy for launching new companies and the industrial-scale expansion of innovative excellence (EU Startup and Scaleup Strategy). According to Commissioner for Startups and Innovation Ekaterina Zaharieva,  the initiative “is a clear statement of purpose: to make Europe the best place in the world to start and grow a business.”

The EU wants to become a hub, and the way to make this possible has several elements: one is simplification, the new watchword of the second von der Leyen Commission. With this in mind, the EU executive announces a “regime to simplify rules and reduce the cost of failure by addressing critical aspects in areas like insolvency, labor and tax law.” Fewer rules, less red tape, and bureaucracy for a more attractive EU and a single market for investment and business.

A new dedicated fund and reform of the Innovation Council

The European Commission is aware of the need to secure funding for start-ups. So, this was the announcement of measures that serve this purpose: the commitment to “establish a European Scaleup Fund” to “close the funding gap” of high-tech companies. It is unclear whether this fund will be an instrument within the next Multiannual Financial Framework (MFF 2028-2034), a first draft of which is expected to be presented by the EU executive on July 16, or a stand-alone measure. Executive Vice-President and responsible for the Industrial Strategy, Stéphane Séjourné, is confident: “Let us make it easier for companies to access finance and improve their ability to operate in our Single Market.

 The EU also intends to reform the European Innovation Council, the special body created and designed to support start-ups (young companies under three years old). Here, the goal stated in the strategy is to “expand and simplify” its mandate and functioning.

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Better links with universities and a ‘blue card’ for non-EU entrepreneurs

Other central points of the strategy are the Lab to Unicorn initiative to connect universities and businesses and granting special business permit schemes for third-country entrepreneurs. The first of the two proposals envisages a model for licensing, royalty and revenue-sharing, and equity participation for academic institutions and their inventors when commercializing intellectual property and the creation of spin-offs.

The second initiative mirrors the Blue Card regime that the EU grants to highly qualified or particularly sought-after workers, enabling them to obtain residence and work permits more easily and quickly. Specifically, “we encourage Member States to set up fast-track procedures for non-EU founders,” i.e., to create fast lanes for entrepreneurs and allow them to do business more easily. In this sense, for all, EU and non-EU industrialists alike, the European Commission will “consider the possibility of allowing companies to establish themselves in Europe more quickly, ideally within 48 hours.“