For a long time it appeared as if six Member States had come together to block the controversial proposal by the EU Commission on single-member private limited liability companies (SUP). Austria, Spain, Belgium, Sweden, Germany and Hungary had been declared opponents. Yesterday, however, at the Competitiveness Council, where the competent Ministers voted on the proposal, one Member State caved in. Apparently Hungary was the alleged “culprit”, making the so-called general approach of the Council possible. This is a major setback for all opponents; however, it is by no means the end of the matter. What it means is that the first battle has been lost, but that the war can still be won!

Resistance in the Council crumbled in spite of massive mobilisation against SUP

Everything started in April 2014. Then, the EU Commission presented a draft directive aimed at creating a new status for single-member private limited liability companies (SUP). Since then negotiations concerning the text have been taking place at Council level. Right from the start, the AK has been relentlessly opposing SUP at various levels, as the planned law was to oblige Member States to provide a special form of the single-member private limited liability company in their national legislation, which would adopt the same name across the EU (Societas Unius Personae – SUP). The main characteristics and thereby at the same time the main points of criticism are the lack of minimum capital, the legitimacy of a cross-border online foundation without checking the identity of founders and managing directors and the option to separate registered and administrative office. In particular the latter would lead to the dismantling of co-determination. Hence, separating these offices is a genuine provocation, which invites the hastening of wage and social dumping. This aspect has now been cancelled in the compromise text of the council; however, this does not solve the problem. The intention now is that all activities of the SUP are carried out at the administrative office without the SUP being subject to the rules of worker participation.

EU Parliament is now the last hope

It is now the turn of the EU Parliament to position itself. The Spanish rapporteur will present his draft report in the coming weeks. He has already voiced his clear opposition against any bypassing the rights of workers. If this is so, one can only hope that the SUP proposal will be rejected at the end of the debate. The Chamber of Labour will continue to oppose any deterioration of workers' rights and do everything in its power to ensure that the war will be won in the end.

Further Information:

Official press release of the Council on the adoption of a general approach

AK EUROPA Position on SUP