Committee on Legal Affairs Ordinary Meeting
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JURI European Parliament
Follow its sittings
Michael McGrath
Member states are encouraged to also access to regulated markets in line with applicable union and national rules. As part of measures to facilitate investment, the proposal allows EU Inc. Companies to issue classes of shares with different economic or voting rights. This gives founders tools to protect the company against hostile takeovers, a concern that was also expressed in the parliament's resolution. At the same time, the proposal does not provide for asset locks as such a mechanism, locks would require a fundamentally different governance model and could hinder investment.
Fifthly, in line with the parliament's call to enable companies to attract and support talent, the proposal introduces an employee stock option scheme at EU level with harmonized features under which employees will only be taxed on the income generated once the shares are sold. The aim is for EU companies to offer employee stock options as a long-term incentive aligned with company growth, not as a substitute for fair remuneration. Last but not least, the proposal will make it easier for the EU and companies to wind down their operations, reducing costs and complexity. Innovative start-ups will have access to simplified insolvency procedures under our proposal. These are the main elements of the proposal, but let me also be clear about what the proposal does not do.
The EU Inc. Proposal introduces a new national corporate legal form, which will be embedded in the legal order of each member state. It harmonizes the corporate aspects for such companies. In doing so, the proposal does not affect individual or collective labor rights, corporate taxation, or anti-money laundering rules. Therefore, national and EU employment, corporate taxation, and AML rules will apply to Ewing companies as they would apply to any other EU limited liability company.
Similarly, as regards the employee participation, the commission proposal ensures that the EU and companies are treated as any other EU limited liability company. In this specific regard, the proposal took a different approach from the Parliament resolution, which recommended specific rules related to employee participation for EU Inc. Companies to avoid creating a separate regime that could create complexity, reduce legal certainty, and ultimately discourage companies from choosing the EU ink form. Finally, while the EU ink proposal is a comprehensive one in terms of corporate law, it cannot alone tackle all the barriers faced by companies. It is the centerpiece of the 28th regime.
It is not the entirety of it. That is why the communication towards the twenty eighth regime adopted alongside the proposal referred to complementary measures, including as regards investment, digitalization, taxation, and employment issues, which will also help companies and will contribute to building the twenty eighth regime. In addition, both the communication and the EUing proposal encourage member states to designate or establish specialized judicial chambers or courts for disputes involving EUing companies, an issue I know was also raised by this parliament. Honorable members and chair. We have a tremendous challenge ahead of us.
The European Council and the joint declaration of the European Parliament, the Council of the European Union, and the Commission, One Europe, One Market Roadmap, have called for an agreement on this proposal by the end of this year. To achieve this, we simply must work together. Harmonized and modern corporate rules are essential to make a real difference for companies, and clearly, this means change. If we remain attached to the status quo, we will not be able to introduce the new rules and solutions that Europe and European companies need. I count on you to enter the negotiations on this proposal with an open mind and a constructive approach, with a focus on our shared objective, and I can assure you that the commission stands ready to support the parliament and the council throughout the negotiations that lie ahead.
So thank you all for your work to date on this important file. And, Jerry, I look forward to our engagement here this afternoon as well. Thank you.
Ilhan Kyuchyuk
Absolutely. Thank you, dear commissioner. I open the floor to members, starting with the rapporteur, Mister Lepassi. You have the floor, mister Repassi, for about 3 minutes.
René Repasi
Thank you, chair. Thanks, commissioner, for presenting the proposal to us. And, I'm indeed glad also to the committee that we can continue with the team, also shadow rapporteurs that was responsible for the parliamentary own-initiative report. I think that was already a good step in the right direction. EU Inc.
Is, as a proposal, to be welcomed except for the name, which is a reference to US American corporate forms. And I think our EU single market should have more self-esteem than to refer to US company forms, but that's just in the name. What is meant for it is we need to create a booster for start-ups, to create innovation in Europe, and indeed to be there for scale-up so that innovation actually stays in Europe. And for that, the proposal of the commission is a good starting point for our legislative procedure. We should be all united by achieving one goal, namely that EU Inc should become a seal of quality for investors, for innovators, and for talent.
That is what we shall achieve. And for that, we need to build indeed a legal highway for founders, for innovators. And as we look at the highway, especially one where we want to drive on in high speed, 48 hours, all digital, we need guardrails or as the British call it, crash barriers. And that is indeed what I'm a bit concerned about, that they are namely lacking. You mentioned in your presentation that you consider that there are sufficient safeguards.
I do believe that this is based on a wrong observation of how EU Inc. Is supposed to be built. If you look at it from the perspective of a founder, does a founder look at EU Inc.? And chooses between EU Inc. And any other EU foreign company form?
Say, a German founder says, I want to have a Cypriot one or an EU Inc. No. It will be a choice between the domestic corporate form and the EU Inc., and that is the right comparison group. So therefore, it is true that under the Court of Justice's case law, foreign shopping is already possible for any other foreign law company form. But do we want to be to the EU Inc.
To be just another vehicle for foreign shopping, as currently some other EU foreign law companies are? I do not think so. It should become a seal of quality. And therefore, the current proposal, in my eyes, still lacks sufficient guardrails in terms of employee protection, in terms of creditor protection, in terms of money laundering, and others. I do not say that the proposal is completely ignorant.
On the contrary, there are sufficient stepping stones on which we can build during the legislative process. So, therefore, improvements will be done. And luckily, there is the old rule in this house that no legislative product at the end will look like the proposal with which it was started. What we do not want to have ultimately is with EU Inc, a label that is stained after already a couple of months of its existence. We do not want to have charlatans build their sandwiches within EU Inc, in there for further tax optimization or better call it harmful tax competition.
We do not want it to undermine protection standards. So by protecting EU Inc. Against Charlatans, we create this label of excellency that we actually want to have for future innovation, which will materialize in a couple of years. That top label is the one that we want to give. Ultimately, we do not award the name of ink to a company form.
What we do here is we award the label of EU to a company. And therefore, we must be very cautious about what is inside in EU that we want to give to a company form. And inside the EU, there is the internal market that makes us all stronger but at high social levels of protection. And that's the ambition that we should follow also in this legislative procedure. Thank you.
Ilhan Kyuchyuk
Thank you. The next speaker is Mister Foss, the Shadow Rapporteur for EPP.
Axel Voss
Thank you, chair. And the commissioner, thank you for presenting this proposal here. And first of all, let me congratulate you and your team, also Kevin Barrett and Ralf Sauer, for what you have achieved with this EU Inc proposal. I do not say this very often, but I think this proposal is a very solid basis for such landmark legislation. So if we could keep the text exactly as it is, it would be already a huge step in the right direction, especially when it comes to cross-border mobility and registration.
Nevertheless, I understand that many in the business community say it has to be the first step of many. So we will still lack the desired level of harmonization in company law, and we will still need to deal with fragmented taxation. So this should be the other steps for the future. But my question to you is, first of all, there are certain aspects in the proposal that should be a reality for all companies, not just EU Inc. For instance, the one and only principle after registration.
Do you think such elements can also be made available for all companies? And second, I believe, you had planned to include templates for investment purposes, which seems like a good idea to attract and simplify investments. Why is this no longer part of the proposal? So, thank you.
Pascale Piera
You, chairman. Commissioner, you finished your proposal mentioning three projects, which I thought were nostalgic. Commissioner, I think that being against this project is actually being quite discerning about the future. The freedom to register oneself under a regime could lead to situations that you are unaware of, meaning that certain national requirements could be circumvented. As you underscored, you would then have lots of shadow companies being set up.
You also risk causing major fraud risks because, as you know, many of the beneficiaries will be more and more difficult to identify. You will promote unfair competition between different social systems, as well as tax and statutory systems. You will deprive the regime of headquarters, which is very important when it comes to business status. Now opening up registering companies means that the activities of the company in question would take place elsewhere, and this is just opening the door to fraud. When it comes to France, the senate on March 24 year rendered or gave an opinion saying that this threatens a country like France, and it means it'll be difficult for us to fight against money laundering because you are short circuiting the system.
Finally, commissioner, I am very surprised that no one here is talking about the rights of employees, because in reality, this option of having stock options means that there's no point in having employees. It's not clear what their purpose would be. We saw this in the US because that's how things work there. Giving stock options is a poison chalice, which in the end will deprive employees of having the status of an employee. So when you mention safeguards or guardrails, respectfully, commissioner, you mustn't confuse modernism with digitalization, particularly when it comes to this project, which is all about fighting fraud.
Mario Mantovani
Thank you. Good afternoon, commissioner. Welcome. Finally, a proposal that's going to help companies, particularly startups and scale-ups. It's important for company law to have less red tape when it comes to registering and setting themselves up within forty-eight hours, and also helping self-employed people as well as extending this to traditional companies and the possibility of already existing companies to convert themselves.
And we think that this facilitates the process. Now EU Inc has characteristics that respect various different risk markets and startups. These mechanisms are about proportionality. However, commissioner, there are some limits to this. Companies who want harmonization and certainty, unfortunately, this regulation doesn't account for that.
There are 27 different national orders, different courts, and 27 different tax systems. And in a volatile market like innovation, we think that this is a bit of an imposition. And what we really want to avoid here is fiscal dumping. The business judgment rule gives excessive responsibility to administrators. So we think that this will create further fragmentation and further uncertainty in a market that is supposed to be a safe harbor, and a harmonized one at that.
Now there is a professor from Hamburg, and I will use his words. He says that the EU ink is well calibrated for the initial phases, but for scale-ups and beneficiaries, it's more ambiguous. There's persistent fragmentation, limited harmonization when it comes to insolvency and tax, which causes uncertainty. And this will also mean that venture capitalists will only be partially satisfied. So, commissioner, we welcome your proposal, but I think that we can do better.
Thank you.
Ilhan Kyuchyuk
Mario. Now I'm going to read the points of the renewed Pascal Kampfah. We thank Commissioner McGrath for the proposal, which is quite ambitious in its scope. As we all know, our group has always been behind the idea of such an EU Inc. Proposal.
We'll work in making it a success before the end of the year. We're very happy to see the level of ambition to forty-eight hours, euros 100 maximum cost, no capital requirements, no notary's obligations. We'll work to ensure that the proposal not only attracts new companies but can make conversions easier. This is a key point when it comes to the EU employee stock option plans. And this is one of the key questions here.
How can we make sure that the national schemes feed well into the EU, Inc. Proposal? A second question from Pascal Convais, how can we make sure that existing start up, which has given employee stock options to its employees and is interested in transforming to a EU Inc. Can do without having fiscal friction for its existing stock option schemes under national plans. With that, I'm moving to Kira Marie Peter Hansen, the Green Rapporteur.
Kira Marie Peter-Hansen
Thank you very much, and thanks, commissioner, for being here. And I would also like to extend congratulations on the proposal. It's been a long way to go, and I'm also very happy to hopefully see it through, quite quickly. I have two questions, one very concrete and technical, and one more broadly, so I'll start with the latter. When it comes to the scope, if I understand correctly, you've kind of differentiated a little bit between corporate law and insolvency law.
And I'd like to understand the political reasoning behind this, both for this, but also moving long term if you see it as a way to include, for example, other elements, could be taxation, could be other things, by differentiating in the scope. And then my more technical question is on labor law, because, like, I understand that or I would like to understand how the commission sees labor law being covered or not covered by this proposal, because we can read in recital 83 that it's not covered, but that's only a recital, and it's not clearly stipulated in article 4.2 that it's not included. So I would like to understand which rules apply when it comes to labor law for the companies in scope. And do you intend a full exclusion of labor law, or how should we kind of understand the proposal? Thank you.
Ilhan Kyuchyuk
Thank you, Kira. I have two more members wishing to speak, Angelika Nibla and Mister Sieper Lucas Sieper. Angelika Nibla, you have the floor.
Angelika Niebler
Thank you so much, Chair. Thanks, commissioner, you know, for presenting this proposal and also for giving us the broader perspective, as regards one Europe, one market road map. Over here. I have I when I'm running around in my constituency, there are huge expectations for these new legal forms. So in particular, startups and scale ups are really waiting for, you know, having this proposal becoming a reality.
But I have two questions, one of which was already addressed by my colleagues as regards to the fragmented taxation issue. When you ask my startup company, when I ask my startup companies, they tell me even today, you can establish a limited liability company in 24 hours. You get everything done. You know the statutes, you get the registration, you get we get everything except the number from the tax authorities. That takes 14 days, three weeks.
So even though we cannot move on the taxation harmonization. But do you have an idea how we can also speed up that the companies get their taxation ID more quickly? Are you planning to get out, come out with a recommendation or whatever? And the other issue was addressed by my colleague right now, the labour law issue. Under our German law, we have the code determination for the employees.
And I was just wondering, do you have any idea how we can cope with that determinations concept which we have under German law with regard to this new EU Inc proposal. Thank you.
Lukas Sieper
Thank you, chair. I think, dear colleagues, this committee can be very honored to have one of the brightest legal minds of the parliament sitting in its row. But enough talking about me, mister Repazi, I think one can see the expertise that went into this file. And, I can only give my full support for me. This is one of the legislations where, as a young person learning about Europe, you think it already exists, and then you learn it doesn't.
So I think this is very important, and I would like to touch very briefly on what my colleague from the right from France said. Only because you can misuse legislation, that is never a good reason to not impose it. Any law can be broken. Any rule can be circumvented, and any loophole can be used. And only because you fear that, you should not fear to enact modern and necessary legislation.
I have one question to the commissioner, given the fact that we should have had this years ago. How do you envision the development of this legislation in five, 10, and 15 years? Thank you very much.
Ilhan Kyuchyuk
Thank you, Lucas. Certainly, your presence brought a bit of cover to our committee. Thank you also for that. The next one is Maravias Abadios Hoffer. Maravias.
Maravillas Abadía Jover
I'm going to speak Spanish. Thank.
you. And thank you, Commissioner McGrath, for your presentation. For a long time now, Europe has been facing legal fragmentation, which makes it difficult to create new companies. We all think that the twenty-eighth regime will depend on how it is implemented in practice and how much trust people have in it. So Europe isn't starting from scratch.
Over the last few years, we've made a lot of progress when it comes to interconnection with registries, the development of the BRISS, and other procedures. And so we think it's important that this needs to be built on what already exists in terms of registrations, and we don't want duplication. And what we really want is interoperability between the various systems. So I've got two questions. Firstly, the commission put forward the possibility of creating a centralized register.
How will the commission justify the need for new European structures when mechanisms like BRIS already exist? And secondly, the combination of the freedom of choice of a member state of registration and the what law will be implemented. I think we need to be careful. So how will this proposal avoid differences between companies and affect legal certainty in the single market? Thank you.
Ilhan Kyuchyuk
Gracias. Maravias, commissioner, back to you. I think there were many questions, many good questions, and we have, I would say, ten, fifteen minutes to answer them, even a bit more.
Michael McGrath
Great. Well, thank you very much, Chair. And can I sincerely thank all of the members for their comments and questions? And this is, in many ways, the beginning of the next stage of the process as I know you work together under MEP Repazi's lead now to agree on a negotiating position, and the council will be doing the same. And then we look forward to the formal trial of negotiations getting underway, hopefully, in the not too distant future so that we can work together to achieve the ambitious goal.
But I think it is achievable to have political agreement by the end of this year. And please be assured of my full support and that of my team to the difficult task that lies ahead in the coming months. But I know that with the same spirit that has characterized our partnership and our collaboration so far on this issue, I believe we can be successful. And I welcome the general acknowledgment that has been given here today by a number of you that the commission proposal is a solid basis for an agreement ultimately. I hope it will be more than a solid basis, but we can go through all of those details now and over the months ahead.
I do hope as well that in the course of the negotiations, when we do eventually reach a conclusion, that we can say we have retained the principle of simplicity. It is important we don't build in excessive complexity into the EU Inc proposal, which could ultimately undermine its potential success and its reach. And I think we do need to bear that in mind over the period ahead. It is also worth saying, and I have said this to my colleagues around the commission table, that this is but one initiative as part of our overall set of efforts to break down barriers in the single market, because this is fundamentally a company law proposal. And an EU, Inc.
Company, once established, under this new regime, once it is in place, will still face the same non-company law barriers that currently exist within the single market. And so that is why all of the different initiatives that are currently underway must be advanced in parallel if the EU Inc. The idea is to achieve its full potential. And I think that's an important point that this is an important initiative, but on its own, it can only achieve so much. It must be accompanied by all the other reforms as well.
And I think as we do delve into the detail over the period ahead, it is important to remind ourselves, you know, what we are seeking to achieve, which is to have the European Union as a more attractive place to establish a company, but also as a location for high-potential innovative companies to reach a global scale with Europe as their base. And in order for them to do that, we know they need capital. They will need investment. That is the essential oxygen of any successful business, and that is why we have constructed the Ewing proposal in a way that is friendly and facilitative to incoming capital. It must be attractive for the injection of capital by investors, but also for talent.
It must be seen as an attractive form of company that can support employees through the innovative idea of having an EU employee stock option plan, for example. All of that said, of course, there will be a need for appropriate guardrails, and I'm happy to explain now and, over the course of the negotiations, the rationale behind the commission's proposal on the different individual issues that have been raised because, of course, there must be appropriate safeguards. We believe that we have appropriate safeguards, and where you have different opinions, that can be teased out and negotiated over the period ahead. In relation to the name, as I have said previously, we do think it is important that the brand of this new form of company needs to speak the language of the global markets. This clarity embodied in a simple and recognizable brand is very important for start-ups and for scale-ups, and indeed for investors.
And while in our view, the chosen label is instantly recognizable, endorsed by the startup community, and will have global appeal. The substance of the rules that we have proposed and which we will negotiate over the period ahead is firmly rooted in European legal traditions, and we build on the existing EU key. But as with all matters, all aspects of the proposal we have made will be the subject of negotiations over the period ahead. This new form of EU ing company will, of course, sit alongside the domestic company form, as a number of colleagues have said. And a number of you have raised questions or concerns about the potential for forum shopping, and you have cited issues around taxation, labor law, and indeed other important, different policy instruments.
And I very much agree with the repertoire that we want this, EU Inc. Proposal to be seen as a seal of quality. Yes. It is inherently European, but it is a global outlook and a global perspective, and it must be associated with quality, and not with any idea that in some ways circumvents important safeguards that we already have. And that's an assurance that I can give and one that I'm happy to work with you to ensure that we can fully achieve that over the period ahead.
In relation to the central register, that was mentioned, this proposal provides that EU ink companies can be registered and may file or submit corporate information through the EU central interface, and the EU central interface will build on BRIS. I think it's important to say that the EU in proposal is very much complementary and additive to everything that has been achieved in recent years in terms of the reform of EU company law, but also the establishment of the Briss, and also what is to come in the form of the business wallet, and the different initiatives that have been agreed at the European level in recent times. We are building on those. We are using those, and this is very much a complementary initiative in that regard. In relation to employee participation, which again has been raised and which I know will feature over the course of the negotiations, in the months ahead, the commission decided to apply to EU companies the employee participation rules where such rules currently exist, in the member state in which they have their registered office.
So where an EU in company is formed in a member state that has employee participation rules, then those rules will fully apply to the EU in company in the same way that they will apply to a company established in that country under the national company law system. And the aim is to ensure equal treatment with comparable national company forms, and not to impose stricter requirements on the EU and companies. We look forward to the debate, the discussion, and indeed the negotiation on this point, but I want you to be assured of the perspective that we come from in relation to this issue. It is to ensure that Ewing is not a vehicle of our convention, but is a vehicle that is recognized as being of high quality, where all of the important rights and benefits and entitlements of employees, and indeed of creditors, in the European Union, are fully respected. And I think it's important that we do give that, we give that assurance.
On the question of forum shopping that has been raised, the proposal provides that an EU Inc is a company established and operating in the EU. It needs to have both its registered office and its central administration, or principal place of business, in the union. However, an EU Inc. Cannot be required to have its central administration or principal place of business in the same member state as its registered office. This approach is very much in line, as colleagues will know, with the case law that we have of the court of justice of the European Union.
The proposal does not affect either individual or collective labor law rights. And can I say generally in relation to labor law? I think we can be very proud of the European Union of the high standard of labor law that we have at national level and right across the European Union. It is crucial that those protections, and the rights of employees, are fully respected and upheld by the EU and companies, and that will be the case under the commission proposal. Unless harmonized rules in the EU in regulation are set out, national laws and collective agreements apply.
The EU ing regulation does not touch upon rules determining the applicable legislation with regard to employment or social security coordination. The recitals to the proposal also clarify that the Rome one regulation will apply to employment relationships involving EU companies and that union or national employment law is not affected. I know this will be an important issue in the months ahead during the negotiations. We will be happy to set out the commission's perspective, and how we believe that the safeguards in place in the EUN proposal are solid, and we look forward to our discussion in relation to that matter. On the question of why we have a proposal that is fundamentally corporate law and less so about insolvency or about other issues, we had to take a number of matters into account when arriving at that conclusion.
For example, the EU in proposal focuses on corporate law, and it would have been difficult to address more policy issues in that proposal also, given the legal basis that we have arrived at. And in relation to insolvency, as colleagues here will well know, only last year, we came through very intense and, at times, difficult negotiations in relation to the insolvency directive. So what we are proposing is the full digitalization of the insolvency process of an EUing company, and we hope that will only be relevant in a very small minority of EUing companies that do not succeed, but inevitably, there will be some. And therefore, full digitalization, we believe, is a good step. Secondly, we are proposing to revisit the question of simplified insolvency regime.
It's in our proposal for innovative startups as defined within the commission publication that we adopted back in March. And we hear different views on this, including from member states, and all of you invested a lot in the negotiations last year. We, from the commission's point of view, were not successful ultimately in having the simplified insolvency provisions included as a mandatory element of the insolvency directive, but rather as an optional element in the end. We are proposing to revisit that in the context of defined innovative startups under this proposal. We think it is appropriate.
We think that it would add value overall to this EU Inc. proposal. On the question of the once-only principle and that being potentially applied to all companies, it would involve amending the consolidated company law directive. It's something that may be revisited in the future. I do think that as we continue on the path of reform of EU company law, as we see greater digitalization and interoperability, this is an issue which will be easier to achieve, across the general body of companies that we have in the European Union, but we want to make it absolutely explicit and a requirement now for EU companies, that once only principle would apply. In relation to templates for investment purposes, for example, the standard articles of association that we are proposing would be made available within nine months of the entry into force of the regulation.
Can I say in relation to stock options that in no way should they be viewed as a vehicle to diminish workers' rights or indeed to be viewed as a substitute for the right to a fair, fair wage, which is well established in the European Union, and with EU law and indeed with member state law, complementing that in many instances as well? And those laws need to be fully respected in all cases. And I think it's important that we make that point, but at the same time, we have to acknowledge. And I heard this from countless founders in the different stakeholder engagements that I had over the last year or so on this issue, they find it really difficult to navigate up to 27 different employee stock option regimes around the European Union, and they find it difficult as a result to attract and then to retain the talent that they need to build and to grow their company in the European Union. So if we are serious about removing the obstacles to having European companies scaling to a global level, then this is an area that I think we do need to pay attention to, and that's what has guided and shaped the Commission proposal in that regard.
To the point that some member states already have, you know, fully digitalized procedures and it's possible to set up a company within hours, and at a pretty low cost, that is true. But one of the problems we face is that that is not the case in every member state of the European Union at the moment, where it can take weeks in some member states. And also, the reality is that even if you are in a very progressive member state where a lot of these features already exist, once that company seeks to scale throughout the European Union, it will then encounter all of the different national forms of company law. Whereas the beauty of this proposal is that it gets established in its member state if that is its choice. Yes.
It may not, on that issue, be a whole lot more efficient than what is currently available in the member states. But once they begin to scale and grow across the European Union, they will benefit from those harmonized features being recognized equally throughout the entirety of the European Union. So that is a fundamental difference to what is currently there under the national company law systems that we have. It will still be for tax authorities to issue the specific and unique tax numbers. It's important that we ensure that there are adequate safeguards.
We know that, this is an area of risk, and therefore, we have to be very respectful of the role of taxation authorities in respect of the generation and the issuance of these numbers. On the question of our ambition and what will this look like in a number of years' time, we set out in the impact assessment what we think could happen. I believe it's on the conservative side. I think that we can overachieve what we set out in the impact assessment. But broadly speaking, you have about 650,000 or so new companies founded in the European Union on an annual basis.
And we are projecting in the impact assessment that by year 10, 10% of the companies that will be founded in that year will choose to be EU companies. So I think we can exceed that expectation if we make this the success that it deserves to be and that we have the potential to make it by working together. We will develop the EU Central Register as committed to in the draft legal text that we have brought forward. Initially, we will work with the national business registers and with the EU user interface portal, that will be provided as well. But we've given a commitment to move towards the central business register, the central database, which again has been a kiosk of the founders and the startup community.
Another kiosk they had was around dispute resolution, as you know, and they called for a dedicated EU court to deal with disputes involving the EU and companies. We examined this issue in some detail. We took legal advice, and the clear advice was that within the existing parameters of the EU treaties, it was not possible for us to make such a proposal. But we are encouraging the member states to either set up a dedicated court or to have a specialized division of an existing court structure within the member states. And I think it's important to say as well that the fact that this is a regulation means we should and we will have a greater level of harmonization.
This will be a direct effect to EU law. It will be complemented by the provisions that we have proposed in the context of the next MFF and the EU digitalization of justice strategy and also the judicial training strategy. Because everywhere I go in the EU, I make the point when I'm engaging with the judges of national courts, that they are all to European courts, and they are the first port of call for the application of EU law. And we very much see it that way, and that's why, the EU Inc. Proposal as a regulation will have direct effect, and we do believe that a high level of consistency can be achieved in that regard.
So, Cherry, I apologize if I've gone over time. I want to just give a quick overview and a response to as many of the questions as I could, but there will be many opportunities over the months ahead as we get into the technical negotiations. My overall message again is let's maintain the ambition. There will be differences on different points within the legislative text. That is normal.
It is a negotiation. We are in your hands. We are here to support you and the council to arrive at an outcome that maintains a level of ambition, that maintains an important level of simplicity so that this will actually work. And I think we should continue to listen to important voices on that journey, as different amendments are being proposed, and listen to their points of view. It's important that we have that consultation in real time during these negotiations because what we don't want to do is, after all of the effort that we have all gone to so far and will go to in the months ahead, that we end up with an agreed file that simply doesn't work.
It must work. We owe that to the founders and to those who are trying to build European businesses and build European champions on a global stage, to give them a vehicle that is simple, that will deliver, that will work in the real world and in the marketplace, that will attract investment, that will attract talent, and that overcomes the company law barriers that we know are currently restricting many companies from reaching their full potential. So I'm really excited by the journey that we have ahead. Look forward to working very closely with all of you, with you in particular, repertoire and all of the shadow repertoires. I've no doubt it will be difficult at times, that will need to be compromised, but we need to, ultimately, land on a proposal that works in the commercial world and which can help Europe to break down those competitiveness barriers that we currently face.
Thank you, chair.
Ilhan Kyuchyuk
Thank you very much, dear commissioner, for this good exchange with the members and also for the detailed presentation of the proposal. Before I conclude the meeting, I would like to give the floor to the parliament rapporteur, mister Repassi, for his final remarks.
René Repasi
Thank you, chair, and thanks a lot, commissioner, for the extensive replies to members in the room, which has I think we are now all very aware of, where the following procedure comes, and indeed, it's now on the legislature to work on the proposal. I think what has also come is now clear after discussion that we had that the issue of the forum shopping is going to be at the heart of it. If we solve it, then we can deliver on what you were saying. And therefore, we must understand where the forum shopping problem lies. It lies with the very fact that there's a disconnection between the potential economic activity of an EU Inc.
And its place of registration, together with the easiness of setting up an EU Inc. Because it's 48 hours, it's all digital, and it's €0 minimum capital requirement, €100 of administrative fee. That distinguishes it from any other EU foreign law company. It can be done very quickly. And we have to understand that the place of the economic activity comes along with the place of employment.
That's the reason why employees, trade unions, and others are very concerned when they are looking at it, because it can be disconnected where the company is registered and where its employees are acting. When you speak of equal treatment, equal treatment requires to be very clear what we are treating equally. Is it an EU, Inc.? With any other domestic form in the place of registration, or is it an EU Inc. With any other domestic form in the place of economic activity where employment takes place?
You were speaking and the proposed, there's a lot of speaking about the former comparison group and not so much about the latter. But we have to also address the latter in order to address the issue of the foreign shopping. I, however, also see that can be solved because if the purpose of EU Inc. Is to attract capital, but in particular, to attract talent, the brightest minds. The brightest minds, they don't go to an employer who wants to undermine employee protection standards.
On the contrary, they only want to go to an employer who respects them. So therefore, closing the open gates that there are for undermining codetermination rules as Angelika Nibla was referring to, to undermine the effective control and check of employee protection rights is actually in the interest of startups and scale ups because then it can create this seal of quality that is supposed to mean as Charlotte Towns will simply have no interest and no incentive to choose for EU Inc. In order to undermine any other protection standards. And as this unites us, commission's ambition, start ups, requests, but also the interests of employees, I do think that we can find solid ground for compromise here if we are aware that we need to get there. And that reference to previous compromises in the last decades does not per se have the solution for Forum Shopping, as Forum Shopping is currently present in the internal market.
So let's, therefore, start this encounter with all ambition and speed that there is needed, but without forgetting the focus on the quality of the legislation that we do here. We have this one bullet to create EU improperly, and therefore, it must be done properly. And if it takes a couple of months more, let's take those months in order to achieve and create this seal of quality. Thank you.
Ilhan Kyuchyuk
Thank you, Mr. Rapporteur. That concludes today's discussion. Thank you, dear commissioner, dear Michael, once again, for your presence and for answering all the questions from our committee. Thank you, sir. Okay, colleagues.
Please take your seats. For those leaving the room, please leave quietly. Take your bilateral conversations outside of the room. Mister Foss, the next item is establishment of the European business wallets. And first, I would like to give the floor to the rapporteur for opinion, mister Fosse, for about four minutes.
Axel Voss
Thank you, chair. So, dear colleagues, I would like to thank you all, shadows and members, for the amendments to my draft opinion on the European business wallet and the constructive spirit behind them. What stands out to me is not our differences, but how much we actually agree. So there's a broad support for the core purpose of the European business wallet, making cross-border business simpler, reducing administrative burden, and giving companies a secure way to identify themselves and exchange data across the union. So several amendments also point in the same direction when it comes to trust and security.
In particular, we seem to agree that data within the business wallet should remain under European jurisdiction and supervision. At the same time, members rightly insist that security must be workable in practice, not something that makes the system too complex or costly to use. Another strong signal from this committee is the focus on SMEs. So the business wallet will only succeed if it is accessible, proportionate, and generally reduces effort for smaller businesses rather than adding new layers of compliance. Finally, many amendments underline that the business wallet must be practical.
This tool must function in real life across borders, across systems, and also between businesses, not only within public authorities. So the direction is clear. Our task is now to translate this shared approach into a coherent legal framework that delivers on simplification, while ensuring trust. And so, therefore, I'm looking forward to working with you all to achieve that balance. Thanks a lot.
Ilhan Kyuchyuk
Thank you, Mr. Foss. In order to supplement your work, I'm going to read out the speaking points of a new shadow rapporteur, Jana Thumb. Thank you, rapporteur, and the colleagues for all your work so far. I'm happy to see a positive approach towards the European business wallet in the many amendments tabled. After our previous exchanges, I hope you are not surprised to see from my amendments that I continue to be supportive of the business, wallets, and to support many elements from the draft opinion that are improving the proposal.
I want to emphasize that this proposal is an important element to simplify the administrative life of companies and allow them to spend more time doing the core parts of their business. For example, I want to highlight the potential of business wallets to help with reporting obligations by allowing a company to generate the necessary report of activities through a few simple clicks. I'm fully behind this proposal, and I will work together with you colleagues to send a good and constructive opinion from the jury committee. What remains as the most important issue for me is the interoperability with existing systems and solutions. That is to avoid any unnecessary costs for companies, administrative authorities, or wasted productivity during the transition.
The commission proposal already goes towards this principle, but a few additional clarifications could be made in the proposal. For example, we can further align with the relevant elements of the digital identity wallets, so that we remove any potential for overlaps. We have to also focus on ensuring a high level of functionality early on so that we do not miss the uptake from the companies. Here, we can try to work from experience with the digital identity wallets where technical specifications are taking too long to be developed and delivered into concrete solutions. Whatever good practices we can take from that process are highly appreciated.
My suggestion would be not to prescribe too much in the proposal if not necessary. There are many common points and ideas stable in the draft opinion. I believe that, with all of the amendments, we'll be able to provide some important improvements to the proposal, and I look forward to working together on delivering a positive opinion on the commission proposal that was on behalf of Jana Tung. So what do we do next? Next, we go to Mister Buddha.
You have the floor, Mr. Buddha. Yes.
Daniel Buda
Thank you, chair. I wish to thank our colleague Axel Foss for his presentation. It is clear that we need to take steps towards digitalizing all fields of life if we want to not be lost in this competition with the US and China and so on and so forth. And I followed attentively the debate with our commissioner earlier. I think it's very important that beyond speed of information or simplifying these circuits, it is also important to underline their security or to ensure their security, because digitalization and the possibility to use the online environment may, at the same time, create a framework where identities can very easily be falsified.
So it's very important to make sure that when I send a document, this document is received on the other side and that it is signed by the person competent to do so. I want to tell you that, unfortunately, in my country, in Romania, we have very serious issues with the signing of documents, the distant signing of documents by companies where those signatures were not given by the persons who have the authority to give the signatures. And this is related to European funds, projects which are underway. And, we noticed that the signatures were not given by the right people. So this is why it is very important to ensure that signatures are secure, and we must give the possibility to establish the identity of the person signing because otherwise, we might end up receiving a signature by AI, for example, not by a person.
So this is very important for the security of the circuits at European level. We do support this proposal from the commission. At the same time, it is very important to introduce necessary and sufficient guarantees to ensure the health of this circuit. Thank you very much.
Next is Mr. Mantouvani.
Mario Mantovani
Thank you, chairman, and thank you, Mr. Voss. I think that in my amendments, I've tabled some proposals that are worth looking at, whether the instrument is obligatory or not, first and foremost. We know that the commission didn't want the wallet to be obligatory for businesses, but that was not clear from the proposal. And I think it is important to make that clear. I also think it's important that an instrument which aims to simplify, increase efficiency, and produce savings should be free for micro businesses, those who have less than 10 employees, at least so that they can use its basic functions free of charge, and they also need free technical assistance, at least during the launch phase.
That would be important for small businesses, I think. Then, on the functionalities of the wallet, I suggested extending them. It shouldn't just be a tool for digital identification or certification. It should become a single access point for businesses, participation in tenders, applications for European tenders, European funding, etc. I think there should be a single interoperable window that's simple, direct, and clear.
I think that would really show that Europe has changed, and businesses will be able to see that. That would really help European industrial policy, I think. And let me conclude by talking about the implementation of this proposal. I mean, delegated and implementing acts take too long, I think. And it often they don't enable businesses and administrations to be in a position where they can use these tools as they come out.
I think, in order to ensure legal certainty, it'd be important to ensure that the regulation came into force after the commission had adopted all the necessary implementing and delegated acts, because otherwise, member states wouldn't be ready. Thank you very much, and thank you again, Mr. Voss.
Fiendank, here for.
Angelika Niebler
Thank you very much, chairman. Operator, ladies and gentlemen. This is an extremely important dossier, this European business wallet. I think this can be a breakthrough towards getting us to a true single market alongside the twenty eighth regime. There's no subject that I want to address because I haven't decided what my view was.
Mister Matavani talked about voluntary, that's about things being voluntary, yes, for b. But for the public and private sector, I wonder whether we shouldn't make it obligatory, obviously, with a sort of staggered approach to deadlines. But I think if we want to motivate the public sector more by making it obligatory, then I think we'll get a breakthrough much quicker. And I love this idea. This is a start-up phase, but there are so many other services.
So if we can get this off the ground in this confidential area, then I think it can really be a breakthrough towards speeding up processes and getting rid of red tape. I just think we need to tackle it properly. And I wonder, I just want to ask the colleague, should we not make this obligatory for the public sector?
Ilhan Kyuchyuk
Does the commission wish to take the floor? Yes? Okay. We have Miss Alina Radu. Right?
Okay. You have the floor, ma'am.
Alina Radu
Thank you very much. And thank you, Chair, for inviting the commission to the meeting. And I would also like to thank the rapporteur, Mister Voss, and his team and the contributing shadows. For us, European business wallets are vital for enhancing the competitiveness of EU businesses and promoting a truly integrated market. We also believe that together with the twenty-eighth regime, it could be the key to unlocking the single digital single market.
And, it is therefore essential that the core principles and articles of the regulation are shaped in such a way to ensure adoption and usability of these solutions. It is very important the business wallets are important not just for in themselves, but also for the effective implementation of other key initiatives such as the '28 regime, such as the Industrial Accelerator Act that came up. And we also think that, indeed, it will be a tool for other use cases such as public procurement, as we have also heard here today, and many others. I also wanted to take just a minute to focus a little bit on one of the key articles of the proposal of the commission, and that is the principle of equivalence, which is of vital importance for the framework in ensuring the legal certainty and recognition for digital interactions between businesses and public administrations, but also in a b to b framework, including for supporting legislation such as digital by default twenty eighth regime. Article four guarantees that actions performed via the wallets have the same legal effect in person, paper-based, or other lawfully compliant methods, without replacing procedural requirements.
Unlike the legal effects of the current framework, which has a narrower scope, the principle of equivalence has a broader intention, and that is to ensure that actions that are carried out through the European business wallets are accepted on the same footing as paper-based or in-person actions. And to achieve the call for one Europe, one market, this can only be done with an approach that covers equally the entire single market and gives all businesses the same competitive advantage. Therefore, if we were to limit the principle to what is already in the current framework, the provision would add very little in practice towards strengthening the internal market. Its purpose is not just to repeat the legal effects of individual EIRA's tools, but also to ensure the effective use and acceptance of the business wallets in the links with public administrations. I also wanted to mention that indeed it is also the purpose of the business wallets to help ensure the guarantee that the person or the company on the other side of a contract or of a communication is indeed who they say they are.
So indeed, this is one of the purposes why we also put out the business wallets regulation. A majority of stakeholders that we talked to in preparing this proposal mentioned this as one of the issues, and this is what we are aiming also at addressing. And, of course, very important that the commission proposal, the use of the business wallet is made mandatory for public sector administrations, precisely because the EIDAS regulations or the digital identity framework has been around since 2001, actually. There is nothing new in it, but we have not yet plugged in our public administrations, including at the union level. And therefore, with article 16, we wanted to take a step which is long overdue.
And therefore, ambitious article 16 would make a difference between a theoretical single market and operational one. Thank you very much, chair. Thank you very much, Mister Rapporteur.
Ilhan Kyuchyuk
Thank you, Madam Radu. Mister Rapporteur, the floor goes back to you for your concluding remarks.
Axel Voss
Okay. Well, I'll go with German this time, I think. Thank you very much, shadow rapporteurs, and also thank you to the Commission for your contribution. Let me begin by saying that here, we with the twenty-eighth regime and with the European business wallet, we are doing something that isn't just protecting people. We're looking to the future here, and we're looking to get a bit more internal market out of this.
What I was surprised to hear was that here, we're talking about data sovereignty. And then the same idea was actually pretty unpopular when it came to the AI omnibus. So it's funny what you see, because we constantly talk about sovereignty, but then, where appropriate, people don't actually want to see it in there. Now on this point about whether this should be voluntary or compulsory for the public sector, I mean, Missus Radu said that we need the principle of equivalence, article 16, so that it can be user friendly. But we're obviously looking to the future in an ambitious manner, and this also ties in with what Mister Buddha said.
We need to ensure that people's identities are secure as is the case for the 28th through June. We already mentioned that. And we don't want to see the door open to abuse. So perhaps we need to have another look at that to ensure that that's something that absolutely doesn't happen. We want to ensure that what we do enjoys public support and trust.
We want to ensure that this actually works for businesses and works in terms of their relations with the public administrations. Now how can we prepare member states for this and to what extent? Well, that's a pretty interesting comment. I mean, I think that often member states really wait until things come in to actually do something about them. And I think we really should be spurring them on to move into the digital world to a greater extent.
I mean, I think at the moment, member states are one of the biggest problems when it comes to harmonizing all this kind of thing. So I think that comment was fully justified. The whole thing does need to be efficient, a single portal or window or whatever. I mean, we need to ensure that this is effective. There are going to be several suppliers and providers, but obviously, all of this needs to be interoperable, and it needs to fulfill the same standards.
So I think we can do something pretty good here, and I'm very grateful to all of those of you who are dealing with the issue and who are looking to bring in something which is new. Well, I'd possibly go further and say even revolutionary. Thank you.
Ilhan Kyuchyuk
Very much. And the vote for the draft opinion is scheduled in July on June 5. So the vote is scheduled for 06/05/26. Well, the next one is conclusion on behalf of the European Union of the Council of Europe, Convention on the protection of the environment through criminal law. I will speak as a rapporteur for this file.
In previous term, the parliament adopted together with the council directive 2024/12/03 on the protection of the environment through criminal law. The 2024 directive was a major achievement in strengthening the EU response to the increasing phenomenon of environmental crimes, which are often of organized nature and cause enormous damage to the environment and public health. While the transposition deadline for the member states is only seven days, we can already discuss new measures to improve our response to environmental crimes. Now similarly to the directive I mentioned, the new convention on the protection of the environment through criminal law sets out international binding standards to define and criminalize serious environmental offenses. It strengthens prevention measures and international cooperation to address environmental crime, including through cross-border investigations, information exchange, and the collection of statistical data.
The convention, once it enters into force, will mean that our neighboring countries will apply criminal law standards consistent with those of the European Union. This will result in improved cooperation, investigations, and accountability. I, therefore, fully recommend that the parliament give its consent to the conclusion of the new convention, and hope for support of our committee in that regard as well. Now I would like to give the floor to the shadow rapporteur of the EPP, Mister Buddha. Yes.
Thank you, chair.
Daniel Buda
Yes. My political group also fully supports the approval of this convention. We know that the environmental protection through criminal law has significantly evolved at the European level, but the directive from 2008 has reached its limits. These offenses are not followed. They are not tried in court in many member states.
We wish that all environmental offenses be tried and sanctioned effectively. And the new directive is an essential step forward, but we must be aware of the fact that it is in its beginning stage. The transposition is, deadline is 2026, and many member states are still moving very slowly. So its impact cannot be assessed. In this context, the Council of Europe Convention comes as a natural following step, which extends environmental protection through criminal law at international level, which is something that we have repeatedly asked for in this parliament.
We wanted to extend these two other states outside of the European Union. Criminal law offenses are the fourth type of offense at international level. We're talking about pollution, deforestation, traffic, dangerous substances. And I would also add here the import of waste to member states perpetrated by organized crime. These offenses are, essentially, trans cross-border offenses, so the answer must also be a transnational one.
Of course, this convention follows three important objectives. It wants to prevent and to prosecute criminal offenses, creating minimum standards for environmental protection and penalties and, of course, consolidating cooperation at the international level. This convention introduces a common list of offenses, which is greatly aligned with the European and common rules for criminal liability and also enforces exchange of information and judicial assistance. These new elements are not just a technical nature. They consolidate the role of the European Union as an exporter of standards in an environment where criminal actions are expanding.
And I would like to make a note from the perspective of the agriculture committee because this would be an important help for this field. It would prosecute and it would maybe prevent the illegal use of pesticides, and it would protect effectively soil and air in the EU, and which would, of course, contribute to combating crime, and it would offer a certainty for agriculture, for farmers, and for all the other operators in the field. Of course, it would create a common level of ambition, maintaining the flexibility for member states. And I believe that this is a coherent step forward in fighting environmental crime. And as I said, we fully support approving this convention.
Thank you very much.
Mario Mantovani
Very briefly, chairman. Well, I don't think there's anyone who wants to call the goals of environmental protection into question. I mean, we are all aware that there are European directives in place. They're rigorous, and they also use criminal law to protect the environment. The content has taken up that content, boosting it and extending it to a wider range of contracting states.
Businesses.
Mario Mantovani
Particularly to blame if they violate some of these standards, not only for intentional acts, but also if they don't carry out the appropriate checks and controls. And that means that they're going to have to maintain complex and very expensive internal control mechanisms. With the Omnibus One, we all worked to lighten the administrative load in terms of sustainability, which was actually becoming unsustainable for businesses. But here, businesses are going to be subject to parallel lines of sanctions, so potentially civil, criminal, and administrative. And potentially, they could face unlimited costs.
I mean, protecting the environment obviously has to be effective, but it has to be financially sustainable as well because otherwise, it doesn't, the environment isn't protected at all. And if I may, the chairman, the deadline for amendments has been established as the day after tomorrow, and we just got the information when we were in Strasbourg. Now we don't work for a multinational. There aren't that many of us. So it'd be great to perhaps have a little more time.
Thank you very much.
Ilhan Kyuchyuk
Thank you, Mr. Mantovani. But let me recall you that under rule 107 amendments in committee shall be admissible only if they aim to reverse the recommendation proposed by Zaraportra. So you have less work to do, Mr. Mantovani. And I'm sure that in such a short deadline, you show your effectiveness. Now let me invite the commission to take the floor if they wish so.
And, we have, Mister Felix Boch, head of unit in DG, MV, and Miss Ingrid Braed, deputy head of unit in DG. Just, you have the floor, ma'am.
Ingrid Breit
Thank you very much, Chair. I have the honor to talk on behalf of DG Just and DG Environment, together with my colleague, Felix Bloch. Chair, honorable members, thank you very much for giving the floor to the Commission on the draft Council decision on the conclusion of the Council of Europe Convention on Environmental Crime, for which the consent of European Parliament is sought. To step up the fight against environmental crime globally, a new Council of Europe Convention on the Protection of the Environment through Criminal Law was adopted on 05/14/2025 after the completion of the quite complex negotiations for which the European Commission had the honor to represent the European Union. The convention is the first legally binding instrument with a global impact to address environmental crime and help state parties to prevent, prosecute, and sanction the most serious forms of criminal offenses, also through strengthened international cooperation.
The convention is also broadly aligned with the relevant provisions of the new EU Environmental Crime Directive, which has been adopted in 2024, and will soon need to be transposed by the Member States. So the deadline will expire now in May. The convention sets out a comprehensive and up-to-date list of criminal offences covering serious forms of environmental harm, such as unlawful pollution, unlawful management of waste, unlawful trading in wildlife species, unlawful mining, and the deterioration of protected habitats. It also includes provisions on sanctions for natural and clear persons who have committed environmental crimes, which will help ensure a more consistent application and enhance the deterrent effect. The convention was signed by the European Union on 12/03/2025 in a very formal ceremony in Strasbourg, exactly on the day the convention was opened for signature by the Council of Europe.
It has been signed by Portugal and Moldova at the same time, and Latvia and Luxembourg followed already since. As a next step in the process, the council shared the draft council decision on its conclusion with the European Parliament in February, with the request for its consent. This Draft Council decision provides that the union should conclude the convention by becoming a party to it alongside its member states. And in order to ensure also full compatibility between the convention and the environmental crime directive, the Union should also express the reservation concerning the definition of certain terms under the convention. Let me conclude by underlining that this convention represents a significant step forward in the fight against environmental crime at the international level.
And we are confident that once ratified, this new convention will provide a global framework in line with the cross-border nature of the environmental challenge that needs to be met. The European Parliament's consent to the Draft Council decision on the conclusion is therefore essential for the union to become a party to the convention, its ratification, and its entry into force. And we are very grateful to Mr. Kyud Chuk, Chair, and also Shadow Rapaceur and the teams for the dedicated work on this file, and remain at your disposal to provide any further information or clarifications. Thank you.
Ilhan Kyuchyuk
Very good. Thank you. The next item is authorizing member state to accept in the interest of the European Union the accession of Cabo Verde to the 1980 Hague convention on serial aspects of international child abduction. As rapporteur on this file, a couple of words of introduction from my side. Cabo Verde has officially joined the HAC convention of 1980 on the civil aspects of international child abduction in October 2022.
This is a welcome step in enhancing global protection against cross-border child abduction and closing the legal gap. For the EU and member states, accession strengthens legal cooperation with Cabo Verde by providing clearer mechanisms for resolving abduction cases involving EU citizens, ensuring prompt returns of wrongfully removed or retained children, and safeguarding access rights for parents in a cross-border situation. It also reinforces the EU's commitment to the child protection and international legal standards, taking into consideration the proximity and close relationship between Cabo Verde and EU member states and the commission's positive assessment on Cabo Verde's level of implementation of the convention. I support the proposal for a council decision authorizing the member states to accept in the interest of the European Union, the accession of Cabo Verde to the HAC convention on the civil aspects of the international child abduction and hope for your support in that regard as well. So let's repeat the same order starting with EPP, and we'll have Katrina Chinichi with us. For EPP, please.
Caterina Chinnici
Yes. Thank you, chairman. I'd like to thank you for presenting this item of the agenda, which I think is actually particularly important because we and our committee have a commitment to protecting the rights of children in all contexts. I fully agree with the proposal because I think it really is key for the parliament to approve the adhesion of Cape Verde to the 1980 Hague Convention. And I think the Legal Affairs Committee should also express its consent.
Now as we heard, the 1980 convention is the counterpart at the international level to the Brussels 2A regulation, which deals with parental responsibility and conflicts, cross-border conflicts when there are disputes within marriages. Now the idea is to ensure that you have cooperation between central authorities nominated by each member state and that can ensure the immediate return home of the minor who's been held elsewhere in the unfortunate situation when there is conflict within a marriage. I mean, obviously, minors, unfortunately, are those who suffer the most in these kinds of situations because they are the most vulnerable. So this is something that is increasing as vice president and coordinator for the rights of children, Missus Kopac said when she made her presentation of the 2025 activity report. And she said to us then that this issue of international abductions of minors is increasing.
So I do think that approving the accession of Cape Verde to the 1980 convention would be a good thing. I mean, it makes things easier between Cape Verde and EU member states, but it also means that guarantees are extended to a larger number of children. And we have the UN rights, convention on the rights of the child, and it refers to the rights of children. And, they're the most important thing, and that's what we be protecting with what we do. Thank you.
Mario Mantovani
Just very briefly. We know that if there is no shared legal framework, children who are kidnapped across borders end up in a dangerous legal limbo. And the good thing about this Hague convention from 1980 is that it ensures rapid procedures, and I think that is the best way to provide psychological protection to young people. I mean, every day that something like this is delayed is another day of trauma for the child in question. So I support Mister Kuchuk's proposal not to proceed to amendments.
Ilhan Kyuchyuk
As you said, yes, the deadline for amendments is May 6, noon time. And for the European Commission, I have Mrs. Patrizia De Luca.
Thank you.
Patrizia De Luca
Thank you, chair, for giving me the floor, and thank you in particular for the draft report, which addresses all the important points of this Council decision. Preventing and effectively dealing with international child abduction cases between the EU member states and their countries is a priority for the union. The 1980 convention has proved to be an invaluable instrument in this regard, also because of its wide ratification among states of different legal systems and traditions. We are confident that Cabo Verde will apply the convention in a correct way as the commission assessment has underlined. So, thank you again to the chair and to the chair de la Porteira.
Ilhan Kyuchyuk
Thank you very much, Adam de Luca. And that was it, dear colleagues. See you tomorrow at 09:00.
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