The European Digital Finance Association (EDFA) has submitted its official response to the European Commission’s consultation on the 28th Regime, marking an important milestone for Europe’s fintech community. This comes as part of EDFA’s wider efforts under the Task Force on the 28th Regime and the European Innovation Act, established earlier this year to ensure that Europe’s fintech sector speaks with a strong and coordinated voice.
Why the 28th Regime Matters
The 28th Regime represents a voluntary, EU-wide legal framework designed to simplify cross-border operations for innovative companies. By providing a single set of harmonized, digital-first rules, the initiative aims to overcome the persistent problem of regulatory fragmentation across Member States.
For fintech companies and their advisors, this could mean:
- Faster and simpler company formation and expansion across borders
- Harmonized licensing and supervisory frameworks
- Streamlined reporting and compliance processes
- A unified approach to investment and employee equity schemes
Placed within the broader European Innovation Act, the 28th Regime has the potential to make Europe more agile, competitive, and attractive for startups, scaleups, and investors alike.
EDFA’s Key Messages to Policymakers
In its response, EDFA highlights several strategic priorities:
- Digital-by-default operations: Streamlined reporting and harmonized digital procedures to reduce administrative burdens.
- Cross-border efficiency: Addressing divergent governance requirements, reporting standards, and regulatory complexity.
- Sector-specific modules: Tailored approaches for financial services to ensure strong prudential oversight, consumer protection, and data standards.
- Unified investment and equity framework: A common EU-wide investment form (EU FAST) and harmonized employee stock ownership rules (ESOPs) to boost financing and talent retention.
- Simplified company formation: Faster, lower-cost incorporation procedures to match international best practices.
- Balanced labour law harmonization: Simplifying procedures while respecting cultural and national contexts.
- Optional adoption: Ensuring that the 28th Regime complements rather than replaces national frameworks.
EDFA also calls for pilot projects to test and refine the framework in real-world conditions, ensuring that the final regime is both practical and impactful.
A Collaborative Effort
This response reflects the input of EDFA’s Task Force and the valuable contributions of member associations across Europe. Their insights and expertise were crucial in shaping a balanced position that combines industry realities with forward-looking recommendations.
We extend our sincere thanks to all associations, members, and Task Force participants for their active engagement and commitment to advancing Europe’s innovation agenda.
Read the Full Response
The consultation represents a strategic opportunity to shape the future of Europe’s Single Market and innovation ecosystem. We invite you to read EDFA’s full response.