Breaking news

European CEOs And Investors Warn Brussels Against Weakening ‘EU Inc.’

Fifty leading European CEOs and investors have called on EU lawmakers to resist watering down the bloc’s proposed EU Inc. legislation, warning that a weakened version could fail to deliver the scale and simplicity Europe’s founders need to compete globally.

A Bid To Simplify Europe’s Fragmented Business Landscape

The proposed law is designed to make it cheaper and easier for companies to launch and operate across EU borders. Backers say it could remove some of the administrative friction that has long made it difficult for startups and scaleups to grow beyond their home markets.

Brussels is expected to approve the measure by year-end, but negotiations suggest the final text may fall short of what many founders had hoped for. For a continent where businesses still confront 27 different legal and regulatory systems, even modest reform is being watched closely.

Why Founders See It As A Competitiveness Test

The legislation is part of the European Commission’s broader push to improve the bloc’s competitiveness. Supporters argue that Europe’s companies struggle to scale because legal fragmentation creates red tape, raises compliance costs and slows expansion inside the single market.

In their letter to policymakers, the signatories said lawmakers must ensure the final version creates “a genuinely European company form, rather than adding another layer on top of 27 national systems.”

Among the signatories are investors from Index Ventures, Accel, Balderton, Atomico and EQT.

The Core Demands From Investors And Founders

The group is urging policymakers to preserve the freedom to choose a registered office, allowing founders to base their company in one EU country without being forced to locate all operations there.

They also want eligibility for EU Inc. to extend beyond “innovative” startups. Critics of a narrower approach argue that restricting access could limit adoption and undermine the law’s usefulness. Supporters of tighter rules, however, say a broader scheme could become unwieldy and lose its focus.

Another key demand is the creation of a single, authoritative European register rather than a patchwork interface built on top of 27 national systems. Proponents say such a structure would make company records easier to search and verify across borders.

The signatories are also pushing for employees to be taxed only when they sell company shares, and for employment protections to remain tied to the country where workers are actually based.

What Is At Stake

For Europe’s startup ecosystem, the debate is about more than legal design. It is a test of whether the bloc can build a framework that supports rapid growth at scale, rather than one that simply overlays another layer of complexity on an already fragmented market.

If lawmakers adopt a streamlined version, EU Inc. could become a meaningful step toward a more integrated European business environment. If they do not, founders and investors warn, the law risks becoming another well-intentioned reform that is too diluted to matter.

LVMH Revenue Rises, But China Weakness Continues To Weigh On Luxury Giant

A Softer Quarter Exposes The Limits Of Luxury’s Recovery

LVMH, the world’s largest luxury group and parent of Louis Vuitton, Dior, Celine and Hennessy, reported revenue of €18.5 billion in the three months to the end of September, underscoring both the scale of its business and the pressure building across parts of the luxury market.

The company’s revenue rose 1.2% year on year in the third quarter, following a 0.1% increase in the second quarter and a 5.9% decline in the first. The trajectory points to stabilization, but not yet to a convincing rebound.

Organic Growth Misses Expectations

Organic sales growth, which strips out currency effects and portfolio changes, slowed to 1% in the third quarter from 3% in the previous quarter. That result fell short of market expectations and reinforced concerns that the luxury cycle remains uneven.

For the first nine months of the year, LVMH generated sales of €57.1 billion, with organic growth of 2%.

In its statement, the company highlighted the breadth of its portfolio, saying that diversification continues to provide resilience in an uncertain geopolitical and economic environment. That remains one of LVMH’s defining strengths: when one category weakens, another can help offset the downturn.

China Remains The Key Pressure Point

LVMH said sales performed well in the United States, Europe and Japan, but conditions in China remained less favorable. That matters because the country has long been one of the most important growth engines for global luxury brands.

The fashion and leather goods division, LVMH’s most closely watched unit, saw organic sales fall 5% as weaker demand in China weighed on performance. Deutsche Bank said the decline was steeper than the roughly 2% drop expected by analysts.

The segment had delivered its first organic sales gain in two years in the previous quarter, making the latest retreat a notable setback.

Brand Equity Faces A Test In China

The quarter also highlighted the reputational risks facing global brands in China. Louis Vuitton drew criticism after suing local tea company Molly Tea over logo copying. Although the company won the case, the dispute sparked social media backlash and boycott calls, adding another layer of pressure to an already fragile environment.

For a company built on scarcity, aspiration and brand discipline, perception is an asset as valuable as inventory. In a market as digitally connected as China, that asset can shift quickly.

Mixed Performance Across The Portfolio

Not every division weakened. LVMH’s selective retailing business, which includes Sephora, posted an 8% organic sales increase. Watches and jewellery, along with wines and spirits, both recorded 6% organic gains.

That broad mix is precisely what has historically given LVMH an advantage over rivals: it can absorb softness in one category without relying on a single growth driver.

Analysts See A Longer Recovery Ahead

Deutsche Bank analysts said the results could lead to further cuts in earnings forecasts for the second half of 2026 and 2027. They added that it is difficult to see what could improve investor sentiment in the near term.

Still, the bank framed the weakness as cyclical rather than structural. In its view, recovery is taking longer because Chinese demand remains subdued, but the problem does not appear to reflect a permanent deterioration in the brand franchise. Analysts said ongoing brand initiatives are beginning to show results, though improvements are likely to remain gradual.

Investor Pressure Continues To Mount

LVMH’s share price has fallen nearly 40% since the start of the year. In September, L’Oréal overtook the group as France’s most valuable listed company, a symbolic shift that captures how sharply sentiment has changed.

Shares in LVMH were down more than 1.6% in Paris around 10 a.m. CEST following the release.

eCredo
Aretilaw firm
Uol
The Future Forbes Realty Global Properties

Become a Speaker

Become a Speaker

Become a Partner

Subscribe for our weekly newsletter