Council Working Party examines Presidency compromise text ST 11829/26

The Irish Council Presidency has presented its first compromise text on the EU Inc regulation (ST 11829/26) to the Council Working Party on Company Law for examination on July 23, 2026. According to Table.Media, the compromise removes insolvency provisions while retaining the controversial Article 114 TFEU legal basis, marking a strategic shift in the negotiation approach under Ireland's six-month Presidency.

Background on ST 11829/26 document

ST 11829/26 represents the first Presidency compromise text on the EU Inc file, presented to Council Working Party Session 12 on July 23, 2026 . The document arrives after eleven previous working party sessions held between April 17 and June 25, 2026 , and follows COREPER discussion of "guidance for further work" on July 15 (ST 11522/26) .

Ireland assumed the Council Presidency on July 1, 2026, and will chair negotiations through December . The compromise text represents Ireland's first substantive intervention in the legislative file, replacing the Cyprus Presidency which had chaired the initial technical examination phase.

According to the revised agenda CM 3679/1/26 REV 1, Session 12 was specifically convened to examine the Presidency compromise text (ST 11829/26) , signaling a transition from article-by-article examination of the Commission's original proposal to negotiation of alternative drafting.

The timing is deliberate. In Parliament, JURI rapporteur René Repasi's draft report is expected July 23, with amendments due July 17 and a committee vote anticipated in September . The parallel presentation of Council and Parliament texts allows both institutions to benchmark their positions before trilogue negotiations.

Key provisions in the Presidency compromise text

The Irish Presidency compromise has removed the provisions on insolvency law, but has retained the controversial legal basis . This strategic deletion addresses one of the most contentious elements from the May 28 COMPET ministerial debate, where insolvency, tax, minimum capital, and the Article 114 TFEU legal-basis question remained as negotiation points .

The decision to excise insolvency rules reflects practical realities. Member States maintain fundamentally different insolvency frameworks, creditor hierarchies, and cross-border enforcement mechanisms. Full harmonization would require treaty-level changes beyond the scope of the current legislative procedure.

The Presidency has retained the controversial legal basis but for now excluded provisions on employee participation . Article 114 TFEU (internal market harmonization) remains the foundation, despite objections from several delegations that worker participation and company governance require Article 50 TFEU (freedom of establishment) as the appropriate legal basis.

The full text of ST 11829/26 is not publicly accessible. The revised agenda names the Irish Presidency compromise text (ST 11829/26), but its full text is not public . This limited circulation is standard practice during working-party negotiations, where drafts remain LIMITE-classified until they achieve sufficient consensus for wider distribution.

Comparison with Commission proposal

The table below highlights the structural differences between the Commission's original proposal and the emerging Presidency approach based on available information:

Council Working Party review process and timeline

The Council Working Party on Company Law continues technical examination with sessions scheduled for July 2, 8, and 23 . Session 12 on July 23, 2026 marks a procedural shift from examination of the Commission text to negotiation of Presidency alternatives.

The working party operates under a structured review process where every Member State is represented by civil servants, who come either from their ministries or their permanent representations . Council Working Parties are composed of civil servants of the Member States, the European Commission and the General Secretariat of the Council and chaired by the Member State which currently holds the rotating Council presidency .

According to Council document ST 8598/26, the Working Party has already completed a first examination of more than half of the Proposal, and while delegations still maintain general scrutiny reservations on the text, they have expressed their strong support to the initiative and endorsed the aim of facilitating the operation of innovative companies across the EU .

The review process follows a predictable sequence: working party examination, COREPER approval, ministerial endorsement, and formal Council adoption. The Council's second-half planning document (ST 10983/26) provisionally lists another ministerial policy debate for September 24 , indicating that technical work must produce a negotiable text before the September COMPET Council.

Next working party sessions

Sessions 10 and 12 are confirmed for July 2 and July 23, 2026, with Session 11 having met on July 8 . According to the Council meeting register, a further session is scheduled for September 1, 2026, allowing the working party to refine the compromise text based on feedback from Session 12 before the ministerial debate.

The timeline is tight. The Commission, Parliament, and Council all maintain the objective of reaching agreement by the end of 2026 . Trilogues cannot begin until both Council and Parliament have adopted negotiating mandates, which requires the working party to produce a general approach by October or November 2026 at the latest.

Stakeholder reactions and potential amendments

Stakeholder positions have crystallized along predictable fault lines since the Commission published its proposal on March 18, 2026.

The startup community through ACT (Alliance for Competitive Technology) has called for stronger harmonization. ACT urges the European Parliament and Council to take the reactions from the startup community into consideration and amend the proposal accordingly, noting that the gaps in tax harmonisation, cross-border hiring, investment instruments, and dispute resolution are not minor technical matters but go to the heart of whether EU Inc. can deliver the simplification it promises .

Trade unions have opposed the proposal's labor provisions. According to the European Trade Union Institute, no harmonisation is envisaged for employee participation rules, and Article 4(2) crucially foresees full application of all national laws at the place of the company's registered office; without an EU-level floor or minimum standard, EU Inc. in its current form may become a tool for regulatory arbitrage .

Labor and trade unions fear worker rights may be impacted, with the European Trade Union Confederation arguing that employees' rights are insufficiently safeguarded . The Presidency's decision to exclude employee participation provisions from ST 11829/26 suggests these concerns are being addressed through separate negotiation tracks.

Repasi draft report amendments

Parliament's position will be shaped by JURI rapporteur René Repasi's draft report. Repasi's draft report on the 28th regime is dated June 29, 2026, with reference PE790.143v01-00, containing 151 pages and 246 amendments to the Commission text .

According to the28thregime.eu, Parliament's first text-level position includes the deletion of Article 4 in favour of a labour-law firewall and designated national gap-filler forms, a numeric startup definition with excluded sectors (Annex Ia), and a ban on trading the shares on public venues . These amendments directly conflict with the Commission's opt-in, sector-neutral approach.

On July 15, JURI debated the draft report, and political groups divided over whether the regime stays open to all companies or is limited to start-ups, whether it remains a regulation on Article 114 or shifts toward an Article 50 directive, and whether it can bar public listing and exclude whole sectors .

"Tax harmonisation, cross-border hiring, employee participation rules, and dispute resolution are all left to Member States."

Source: ACT Alliance for Competitive Technology, April 7, 2026

Next steps and implications for final adoption

The examination of ST 11829/26 on July 23, 2026 triggers several parallel tracks.

First, delegations will provide initial reactions during Session 12. Standard practice allows Member States to submit written comments within 48-72 hours following the session. The Irish Presidency will consolidate these inputs into a revised text for Session 13 (likely early September).

Second, COREPER must approve the compromise direction before ministerial endorsement. COREPER discussed guidance for further work on July 15 (ST 11522/26), but neither the note's substance nor a public outcome is available . The ambassadorial-level committee serves as the gatekeeper between technical work and political decisions.

Third, the Council's second-half planning document (ST 10983/26) provisionally lists another ministerial policy debate for September 24 . This COMPET Council session will determine whether the compromise text has sufficient support to proceed toward a general approach, or whether fundamental disagreements require further negotiation.

Fourth, trilogue negotiations with Parliament cannot begin until both institutions have adopted mandates. Amendments are due on July 17, with the committee vote expected in September and plenary vote to be confirmed . The timeline suggests trilogues in October-November 2026, with final adoption in December only if negotiations proceed smoothly.

Member State positioning

The May 28 COMPET ministerial debate left safeguards, legal certainty, national labour rules, insolvency, tax, minimum capital, and the Article 114 TFEU legal-basis question as negotiation points . Twenty-six delegations spoke during COMPET on May 28, and the first public country groupings are now visible .

According to Council background brief ST 8598/26, further clarifications may be needed on issues including the legal basis, insolvency and taxation aspects, forum shopping, co-determination and the need for more safeguards . The Presidency compromise attempts to address several of these concerns by removing the most contentious harmonization elements while retaining the core regulatory framework.

"The signal was momentum, not agreement on text: safeguards, legal certainty, labour rules, tax, insolvency, and the Article 114 legal-basis question all remain open."

Source: COMPET Council ministerial debate readout, May 28, 2026

Impact on implementation timeline

The Commission aims to reach an agreement by the end of 2026, with entry into force in 2027 or 2028, but given the wide-ranging impact it is likely that the new regime will not be available for use before 2029 . This assessment predates the Presidency compromise but remains valid given the substantive issues still under negotiation.

If agreement is reached by end of 2026, the regime is expected to be operational from early 2027 . However, this optimistic scenario assumes rapid convergence between Council and Parliament positions during trilogues, which the divergence between ST 11829/26 and the Repasi amendments makes unlikely.

The deletion of insolvency provisions creates an immediate implementation challenge. Companies using EU Inc will face 27 different insolvency regimes depending on their registered office location, undermining the cross-border uniformity that the regulation seeks to achieve. This residual fragmentation may require transitional provisions or interpretive guidance during the implementation phase.

What this means for stakeholders

For founders and startups: Monitor the September 24 COMPET Council debate closely. The ministerial discussion will indicate whether the compromise text has political support or faces fundamental opposition. If the legal basis controversy remains unresolved, expect delays beyond the December 2026 target. Early movers should prepare for a 2029 operational timeline, not 2027.

For investors: The exclusion of insolvency harmonization means portfolio companies using EU Inc will require country-specific risk assessment at the registered office level. Standard venture term sheets will need jurisdiction-specific annexes addressing creditor hierarchies, preference waterfalls, and cross-border enforcement mechanics. Factor this complexity into due diligence processes now.

For legal practitioners: The divergence between Council (ST 11829/26) and Parliament (Repasi amendments) positions signals extended trilogue negotiations. Track the JURI committee vote in September and compare the final Parliament mandate against the Council general approach when published. The gap between these texts will determine whether trilogues last weeks or months.

For policymakers: The Presidency's strategic deletion of contentious provisions (insolvency, employee participation) represents a minimalist approach to harmonization. This reduces immediate political friction but creates enforcement gaps and residual fragmentation. Consider whether this compromise architecture genuinely delivers on the "One Europe, One Market" ambition or simply relocates complexity from formation to operation. Review our analysis of national court interpretation risks for systemic implications.

For Member States: Delegations should submit detailed written comments on ST 11829/26 before the Session 13 deadline. The working party chair will consolidate inputs, but unaddressed concerns at this stage become harder to reopen during COREPER or ministerial review. States with strong labor or tax competencies should engage bilaterally with the Irish Presidency during August to shape the September text.