On 28 May 2015, the European Council agreed on a compromise text for a draft directive aimed at creating a new framework for single-member private limited liability companies.
The draft directive aims to facilitate the cross-border activities of businesses across the EU, particularly SMEs, and the establishment of single-member companies as subsidiaries in other Member States, by reducing the costs and administrative burdens involved in setting up these companies.
To achieve this objective, the draft directive introduces a common framework governing the formation of single-member companies. Member States would have to ensure that their national legal systems provide for a form of company that complies with common rules established in the directive. The legal form would be established at the national level. It would have an EU-wide abbreviation, the SUP (Societas Unius Personae).
A major innovation in the draft directive is that the SUP can be registered on-line using templates provided by member states.
Currently, the minimum capital required for the formation of a single-member private limited liability company varies among the Member States. The general approach for the SUP would be a symbolic minimum share capital requirement of €1 (or one equivalent unit of a member state's currency if not the euro).
In order to ensure adequate protection of creditors and other stakeholders, Member States will have to ensure that their national laws provide mechanisms to prevent SUPs from being unable to pay their debts. According to the European Council, examples of such mechanisms include requiring companies to create legal reserves, establish balance sheet tests and/or issue a solvency statement.