Invest Europe
Company law & corporate reporting
Key policy areas
30 Oct 2025
The existence of 28 different company law and corporate governance rulebooks in Europe is considered by the Commission as one of the main barriers to a Capital Markets Union. As a result, further reviews of the Accounting Directives and other relevant pieces of legislation in this field are expected over the next few years.
How does it affect private equity?
Changes to company law can impact the industry in multiple ways. For instance, they could require further reporting and thus increase administrative burdens on private equity-backed companies.
Corporate reporting
In 2014, the International Accounting Standards Board (IASB) adopted the International Financial Reporting Standards for financial instruments (IFRS 9). IFRS 9 sets out the requirements for recognising and measuring financial assets, financial liabilities and some contracts to buy or sell non-financial items. IFRS 9 became applicable in the EU after having been endorsed by the Commission in 2016 and has been in force since January 2018 (although there is a delay until 2021 for insurance companies).
How does it affect private equity?
IFRS 9 impacts the private equity industry in different ways. The new accounting rules apply to LPs’ investment in GPs. In addition, the rules cover the treatment of GPs investments in portfolio companies, as well as direct investments by institutional investors in the equity of companies.
