EU Small Business Act cuts Red Tape

The British Chambers of Commerce (BCC) has welcomed plans unveiled in the EU Small Business Act to cut the red tape SMEs face when new EU laws are introduced.

The newly–published Act includes proposals to introduce regulatory impact assessments for any new EU laws that affect SMEs.

“In every regulatory impact assessment EU member states will need to carry out a review on how that proposed reform will affect small businesses,” said BCC European adviser Karen Clements.

“SMEs are disproportionately affected by legislation because they don’t have the resources to absorb it, so we want ministers to quantify the costs and the benefits for SMEs as distinct from larger companies,” she added.

“We would also like to see more forceful language in terms of committing every EU member state to the terms of the Act, as at the moment the EU Commission invites members to enforce the different elements, but there’s no deadline and no specific targets,” said Clements. “We hope the member states will come back and say yes, we support this, and do it before a certain date.”

Before it becomes law, the Small Business Act will have to be approved by all 27 EU member states this December. The regulation changes in the Act are intended to make life easier for small firms throughout the EU. The reforms include:

  • increased access to funding for SMEs by simplifying the procedures and reducing costs of applying for finance
  • the right for SMEs to set up their business as a European Private Company in one or more member states. This would provide a universal business status which would reduce the compliance costs in different countries
  • a proposal for reduced VAT rates for locally–supplied services
  • an amendment to the late payments directive in 2009 to ensure SMEs receive payment within the 30–day time limit.

“The Small Business Act provides a critical opportunity to give Europe’s entrepreneurs a better deal,”

said the Federation of Small Business‘s EU and international affairs chairman Tina Sommer.

“The European Commission’s proposals are a good place to start, but national governments must significantly beef up this document for it to offer tangible benefits to all small businesses,” she added.

For more information on the EU Small Business Act, visit the EU Commission website

EU Small Business Act Plans to Cut Red Tape

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