In a lecture in Vienna, European Central Bank Executive Board member Isabel Schnabel argued that Europe’s central economic challenge is not a lack of ideas or talent but a lack of scale, and promoted the creation of a “28th regime” as a unified European corporate framework to reduce fragmentation and help firms expand, raise capital and grow across the European Union. The speech pointed to persistent regulatory and administrative barriers within the Single Market, estimated to be equivalent to tariffs of 96% for services and 67% for goods, and linked Europe’s weaker productivity growth to smaller firm size and slower diffusion of new technologies. The proposed 28th regime would allow companies to incorporate as a genuinely European firm under a single set of rules for core elements of company law, governance, shareholder rights and employee financial compensation, with a quick, cheap and fully digital process. Participation would be voluntary and open to all firm sizes and sectors, designed to complement national systems rather than harmonise labour markets, social security or corporate taxation, and it would ideally be established via an EU regulation directly applicable across Member States to avoid recreating fragmentation.
European Central Bank 2026-02-11
European Central Bank’s Schnabel calls for a 28th regime to unlock Single Market scale for EU firms
European Central Bank Executive Board member Isabel Schnabel, in a Vienna lecture, advocated for a "28th regime" to unify European corporate frameworks, aiming to reduce fragmentation and enhance firm growth across the EU. The regime would offer a voluntary, digital incorporation process under a single set of rules, addressing regulatory barriers and promoting productivity by facilitating firm expansion and technology diffusion.