The Lithuanian Trade Union Confederation (LPSK), supporting the position of the European Trade Union Confederation (ETUC), has addressed Minister of Economy and Innovation Edvinas Grikšas regarding the European Commission’s proposed so-called “EU Inc.” / 28th regime regulation. The issue is being discussed at the EU Competitiveness Council meeting on 28 May.

LPSK emphasises that the current proposal poses a serious threat to workers’ rights, collective bargaining, and the stability of national labour law systems across Europe. Trade unions warn that the regulation contains no mandatory and enforceable safeguards to protect workers’ rights or ensure the role of trade unions.

According to LPSK, one of the greatest risks is that large multinational companies could choose this regime in order to circumvent national labour standards. The organisation also criticises the so-called “country of origin” principle, under which employment relations could be governed by the law of the country where the company is registered, regardless of where employees actually work. Trade unions compare this logic to the previously highly controversial “Bolkestein” directive.

LPSK also points out that the proposed ultra-fast company registration process – completed within just 48 hours – together with a fully digitalised operating model, could weaken the ability of labour inspectorates and tax authorities to effectively supervise company activities. In addition, workers would face increased risks in cases of company insolvency.

Trade unions also question the legal basis of the proposed regulation and criticise the choice of adopting a regulation rather than a directive, as this would limit Member States’ ability to introduce stronger worker protection measures at national level.

In its appeal, LPSK urges Lithuania to demand at the EU Competitiveness Council that the “EU Inc.” regulation should not be adopted in its current form until clear and binding guarantees for the protection of workers’ rights are established. Among the key demands are the protection of national labour law systems, trade union rights, workers’ participation in company governance, and workers’ rights in insolvency cases.

“We are convinced that Europe must pursue competitiveness through investment, clear rules, and an effective industrial policy – not by creating legal loopholes that undermine the European social model and the integrity of the internal market,” the LPSK states in its letter.