Nine in ten (90%) organisations in Ireland's financial services sector believe Irish firms would have significantly better opportunities to expand and grow under a proposed new EU system that would allow any company to establish itself across all member states within 48 hours, using a single digital legal framework.
According to a new survey by Ireland's professional body for compliance professionals, the Compliance Institute, the two most valuable benefits of the proposed new system, known as the ‘28th regime’[1], for Irish firms will be greater regulatory consistency and easier expansion across the EU.
The survey polled 123 senior compliance experts working primarily in Irish financial services organisations nationwide, exploring their views on the proposed 28th regime - a system that would allow companies to operate across all Member States under one common set of rules, rather than 27 separate national regimes.
Headline findings from the Compliance Institute survey reveal that:
- More than four in ten (42%) of compliance experts in the financial services sector believe the planned 28th regime will “significantly” improve growth and expansion opportunities for Irish firms, with a further 48% expecting it will “somewhat” do so (see Table 1 in Appendix).
- The overwhelming majority (97%) of compliance professionals believe that, to varying degrees, the new regime could ease the administrative and regulatory burdens on firms operating across multiple EU jurisdictions, with four in ten (40%) saying it would do so to a ‘great extent’, almost half (45%) saying ‘to some extent’, while around one in twelve (8%) believe it could do so but only to ‘a limited extent’ (see Table 2 in Appendix).
Commenting on the survey findings, Michael Kavanagh, CEO of the Compliance Institute said:
“The EU’s proposed 28th regime, if introduced, could be a gamechanger for Irish firms and this is borne out by the results of our survey, which found that most compliance professionals believe the new system would lead to better growth and expansion opportunities for Irish firms.
Given that an Irish - or indeed any EU - start-up aiming to expand across the EU currently has to comply with potentially 27 different versions of company law, there are concerns amongst EU officials that the existing system is acting as a disincentive to investors and to European firms seeking to expand. There are also concerns that the current system is prompting European start-ups to relocate to the US in order to scale up and attract funding. So, the rationale for the EU moving to simplify things with one proposed single set of rules is understandable. A simpler framework could make it easier for entrepreneurs to start and grow an EU-wide business and in turn, for that business to prosper.”
Top 3 Benefits of 28th Regime
According to the Compliance Institute survey, the top three potential benefits of the proposed EU 28th regime which would be most valuable for Irish firms are:
- Greater regulatory consistency (40% of compliance professionals cited this as the most valuable potential benefit)
- Easier expansion across the EU (cited by almost one in three compliance experts as the most valuable potential benefit)
- Reduced compliance complexity (cited by 15% of those polled)
Ironically, none said that ‘increased innovation and growth’ would be one of the benefits of the proposed 28th regime – though this is one of the key aims of the framework.
Commenting on this aspect of the research, Mr Kavanagh said:
“Our survey shows that there is strong support for the proposed 28th regime in the Irish financial services sector and given the significant pressure that the volume and pace of EU regulatory changes has put on businesses and compliance teams in recent years, this is perhaps not surprising. A survey conducted by the Compliance Institute last year found that nearly six in ten organisations in Ireland’s financial sector cited the continuous influx of new EU and Irish regulations as their biggest compliance challenge in 2025.
While strong and good regulations are important, a more measured approach to regulations and rules could ease the burden of red tape on Irish and EU businesses and perhaps be more conducive to economic growth and prosperity.
It’s very early days with the proposed regime – it could be 2028 by the time the new system comes into force[2]. Like any new regulatory framework, it’s important that safeguards are built into it so that the 28th regime isn’t abused.
Importantly, the 28th regime’s set of rules would not replace the 27 EU countries’ existing national rules, rather it would provide a simpler alternative alongside them. All the same though, one of the big challenges ahead is for the EU to work out how national rules and the proposed 28th regime can work side by side. It’s crucial that the new 28th regime doesn’t undermine the important protections and standards already built into existing national laws, such as employment rights and consumer protection. A significant amount of work will also need to be done around how a country’s national tax and social security rules can work alongside the 28th regime. It’s important that time is taken to get this system right.”
[1] As per European Parliament Explainer EU Inc.: what is the 28th regime?
