• Legal basis

The proposal is based on Article 50(1) and (2) TFEU, which empowers the European Parliament and the Council to adopt provisions in order to attain freedom of establishment. This legal basis has already been used by the EU legislator to act in the area of company law. In particular, Article 50(2)(b) aims to ensure 'close cooperation between the competent authorities in the Member States in order to ascertain the particular situation within the Union of the various activities concerned.' Article 50(2)(c) allows for the abolition of administrative procedures and practices that form an obstacle to freedom of establishment. Article 50(2)(f) allows for 'the progressive abolition of restrictions on freedom of establishment', both as regards setting up branches or subsidiaries. Article 50(2)(g) allows for coordination measures concerning the protection of interests of companies' members and other stakeholders. By improving cooperation between Member States' authorities through the system of interconnection of registers, abolishing administrative barriers to the freedom of establishment, including when setting up cross-border subsidiaries and branches, and by providing new harmonised disclosure requirements, this proposal will contribute to attaining the freedom of establishment as enshrined in Article 50 TFEU.