On 9 September 2026 the European Commission presented its proposal for a European Innovation Act, designed to make it easier to finance innovative companies and to turn research results into successful products and services. The proposal is part of the EU Startup and Scaleup Strategy, under which the Commission also proposed EU Inc. in March 2026 — the so-called 28th regime, intended to make doing business across the EU easier. The Act targets two barriers to growth: the difficulty of using intellectual property to raise capital, and fragmented rules on public procurement of research and development. It comes with a proposal for common principles for regulatory sandboxes, which are meant to make it easier to test innovations under the supervision of the authorities.
Why good technology is not enough
Although the EU performs well in the early stages of research, it has long struggled to turn research results into market-ready products and into companies capable of further growth. Before reaching the market, projects often find it hard to attract private investment because investors still see them as too risky, and the further growth of innovative companies is then held back by financial, regulatory and market barriers. These barriers weaken the incentive to invest and limit the emergence of new innovative companies and industries.
Raising finance is also harder because banks and investors find it difficult to assess the value of intellectual property (IP). According to the Commission, IP accounts for more than 90% of the value of some leading companies, yet in the EU it is rarely used as collateral for loans. One more figure illustrates the scale of the funding problem: by their tenth year, European startups raise roughly 50% less capital than their US counterparts.
What the Commission wants to change
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Make it easier for companies to access finance through intellectual property
The proposal provides for a common EU framework for IP valuation and a digital marketplace connecting buyers and sellers of intellectual property. It is also meant to support the development of a secondary market that will make it easier for companies to sell these assets. It further supports IP-backed financing and its commercial use through advisory services, training and the development of financial instruments.
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Harmonise the procedure for procuring research and development
A common procedure is meant to increase legal certainty, speed up the path of new technologies to market and make joint procurement by contracting authorities from different Member States easier. It could cover, for example, innovation in healthcare, education or clean mobility.
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Support the testing of innovations in regulatory sandboxes
In parallel, the Commission put forward a proposal for a non-binding recommendation on common principles for regulatory sandboxes. A sandbox allows a new solution to be tested for a limited period under the supervision of a regulator, sometimes with a temporary exemption from the rules.
How to turn the value of technology into money for growth
A company may have strong technology, but without a comparable valuation, experience with IP and a functioning market for rights, a bank will struggle to judge whether to accept a patent as collateral for a loan. Likewise, an investor may not see clearly what economic value the IP brings to the company.
The proposal aims to make it easier for companies to use their intellectual property when seeking a loan or investment. A competence centre is to be set up at the European Union Intellectual Property Office (EUIPO) to prepare a common voluntary valuation framework, digital tools, training and voluntary certification of valuers. Companies could then demonstrate the value of their rights in a way that banks and investors understand more easily.
| What a company needs | What holds it back today | What the proposal should make easier |
|---|---|---|
| Obtain financing | Banks and investors find it hard to assess the value of IP rights | Comparable and more trustworthy IP valuation |
| Use IP as collateral | Uncertainty about what the rights would sell for | Valuation and a developing market for rights |
| Earn from licensing or a sale | Finding a suitable partner is hard | Matching with interested parties through a platform |
For a company, this should mean lower costs and less complexity in valuing and using IP. A bank gets a better basis for deciding whether the rights can be accepted as collateral. An investor, in turn, gets a better basis for assessing the commercial potential of the technology. The aim is to widen the financing options for companies whose main value lies in the rights to what they have developed.
Licensing can bring in additional revenue. A company might, for example, develop a technology for the automotive industry but lack the capacity to develop its use in agriculture itself. The digital marketplace is meant to help it find a partner who will pay for that use; the two then conclude the contract outside the platform. Easier sale of rights also matters to the bank: it can improve the chances of realising the collateral if the company stops repaying.
Better options for financing, selling and licensing can increase the return on investment in development and patent protection. The company could then raise additional money for its product and expansion.
Use of the framework is to be voluntary, and access to it, as well as basic access to the digital marketplace, will be free of charge. The office will be able to charge fees for certain specific services, limited to their cost; the valuation itself will normally be paid for by whoever commissions it.
The framework is to cover all types of intellectual property rights as well as regulatory exclusivities in pharmaceuticals.
Paid development and the freedom to sell to other customers
A contracting authority can pay a company to develop a solution that is not yet on the market. Differing rules across Member States, however, make it harder for companies to take part in such tenders and for contracting authorities to procure jointly across the EU. The proposal would introduce a common procedure that also covers the development of prototypes, testing and the supply of a limited quantity of first products. This regime does not, however, cover production or supply in larger quantities to establish commercial viability or to recover research and development costs. The subsequent purchase of a finished solution for regular operation is to remain subject to the applicable public procurement rules.
What matters for a company’s growth is that, as a rule, it is to keep the intellectual property rights to the results. A technology developed for one public project can therefore earn money with other customers too. The company is to protect the results and seek to exploit them commercially; the contracting authority obtains royalty-free rights to use the results for its own needs, including for having its contracts performed by other suppliers. The proposal also sets out exceptions and the conditions under which the company’s rights may be interfered with if the results remain unused.
New opportunities for growth: what to prepare for today
The proposal could make it easier for companies to raise capital, earn licensing revenue and win contracts to develop new solutions.
Ekaterina Zaharieva, Commissioner for Startups, Research and Innovation, links these changes to the ambition of creating a genuine single market for innovation by 2028. The availability of the individual tools, however, depends on the proposal being adopted and on their preparation; for the valuation framework and the digital marketplace, the proposal allows up to four years from the regulation’s entry into force.
When it comes to financing and commercially exploiting intellectual property, how well a company has its rights in order will be crucial. It therefore makes sense to check now whether the company can prove that it has acquired the rights to its technologies, has appropriate contracts with employees and suppliers, and has the necessary registrations and protection of its know-how in place. This will make negotiations with banks, investors and prospective licensees easier, regardless of when the new EU tools become available.
