Directive (EU) 2025/25
The European Council adopted on 16 December 2024 the Directive 2025/25 that the EU Parliament formally adopted at first reading on 24 April 2024. the Directive amends the Directives 2009/102/EC and (EU) 2017/1132 as regards further expanding and upgrading the use of digital tools and processes in company law (the “Directive”).
The aim of the Directive is to develop the use of digital tools and digital processes in company law. In particular, the Directive aims to:
- enhance trust and transparency in companies across Member States and improve the reliability of company data;
- create more connected public administrations and achieve more digitalised and connected cross-border public services for companies within the EU; and
- reduce excessive and unnecessary regulations and formalities in cross-border operations.
Enhancing Corporate Transparency Through Interconnected Registers
For this purpose, the new rules will facilitate the sharing of company data through the dedicated Business Registers Interconnection System (BRIS). In connection therewith, the Directive encourages the use of a “once-only” principle, meaning that companies are not asked to submit the same information to public authorities more than once.
Besides, the Directive foresees to create a connection between the BRIS, the Beneficial Ownership Registers Interconnection System (BORIS) and the Insolvency Registers Interconnection system (“IRI”), in order to facilitate access to information, meaning that the company data encoded in the business registers must be “accurate, reliable and up-to-date”. Such data will become directly accessible through the system of interconnections of registers via the European e-Justice portal.
The Digital EU Power of Attorney: Simplifying Cross-Border Representation
Moreover, to facilitate the achievement of these objectives, the Directive introduces the Digital EU Power of Attorney — a standardized, multilingual European template designed to streamline cross-border procedures. This digital power of attorney will enable a designated representative to act on behalf of a company in cross-border transactions while significantly reducing administrative burdens. Notably, it eliminates the need for formalities such as apostilles and translations of company documents. The Digital EU Power of Attorney will include key information such as the scope of representation, details of the authorised representative, and the type of representation granted.
Introduction of the EU Certificate: A Key Step Towards Simplification
As part of its effort to streamline cross-border business operations, the Directive introduces the EU Certificate — a standardized document designed to prove the legal incorporation of a company in an EU Member State. This certificate will include essential company details such as the company name, registered office, legal representatives, and corporate purpose.
Companies will be able to obtain the EU Certificate by applying to their national business registers or retrieving it through the EU’s interconnected register system. To enhance accessibility and efficiency, the EU Certificate must meet the following criteria:
- Official issuance and certification by national business registers
- Free of charge for all companies
- Available in all official EU languages, without replacing existing national extracts and certificates.
A Boost for SMEs and a More Integrated Market
By enabling faster and more cost-effective cross-border procedures, the Directive is particularly beneficial for small and medium-sized enterprises (SMEs) looking to expand across the EU. It aims to foster a more integrated and digitalized single market, significantly reducing administrative burdens, which are estimated to cost businesses around EUR 437 million annually.
Timeline for Implementation
The Directive was published in the Official Journal of the European Union on 10 January 2025 and will enter into force on 30 January 2025. Member States will have 30 months to transpose its provisions into national law, with full application starting 42 months after its entry into force.
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