Eurpean law report - A 'Small Business Act' for Europe
The European Commission (EC) is planning to launch a new initiative for small- and medium-sized enterprises (SMEs) later on this year in June. This will be done in the form of an Act which is an innovative piece of legislation, since the EU has mainly...
The European Commission (EC) is planning to launch a new initiative for small- and medium-sized enterprises (SMEs) later on this year in June. This will be done in the form of an Act which is an innovative piece of legislation, since the EU has mainly enacted its legislation in the form of directives or regulations.
An indication of this initiative is contained in the EC's paper titled A Single Market for 21st-Century Europe, wherein the EC acknowledges the need to give a new impetus to the Single Market, with SMEs being at the forefront.
The European small company statute, inspired to a certain degree by the US Small Business Act of 1953, aims to set principles and concrete measures to improve the framework conditions for European SMEs, while taking full account of their diversity. The EC recognises that SMEs require special attention in the Single Market and the Small Business Act is intended to provide guidelines and set out provisions tailored for SMEs. The new Act will be a comprehensive piece of legislation which will include under one law the piecemeal provisions concerning small businesses currently contained in various laws and policies of the EU.
The primary aim of the new proposal will be to reduce the administrative burden for SMEs and cut red tape as far as possible. Red tape and compliance with governments' bureaucratic formalities and regulations burden SMEs and obstruct their growth and success.
One of the proposals indicated by the EC for its new initiative is the setting up of "one-stop shops" in each member state where SMEs can find all the information they need about operating in other EU member states, thereby reducing obstacles to cross-border trade. The structure has already been put into place with the establishment of the Enterprise Europe Network, which will support business primarily SMEs.
SMEs will also benefit from this new proposal it aims at increasing their access and participation to EU programmes and funding. It will also aim to increase their share in public procurement by introducing measures to help boost SME participation in government tenders. Preferential treatment in the form of positive discrimination in favour of SMEs by reserving a share of public procurement contracts to SMEs has already been dismissed. The aim instead will be the increase will of transparency and information on public tenders. Taxation policies and practices in relation to SMEs will also be tackled. Competitive tax infrastructures will also be introduced in an aim to reduce the tax burden on enterprise.
The binding nature of this new initiative is still open for discussion. The view within the mainstream is that the new Act has to be more than a mere action plan or charter that sets out principles, but a legally binding document.
A consultation process is currently open with all stakeholders being urged to submit their view on developing a Small Business Act for Europe. The closing date for this public debate is March 31, 2008, and any contributions are to be sent by email on entr-sba@ec.europa.eu.
• Dr Grech is an associate with Guido de Marco & Associates and heads its European law division.
An indication of this initiative is contained in the EC's paper titled A Single Market for 21st-Century Europe, wherein the EC acknowledges the need to give a new impetus to the Single Market, with SMEs being at the forefront.
The European small company statute, inspired to a certain degree by the US Small Business Act of 1953, aims to set principles and concrete measures to improve the framework conditions for European SMEs, while taking full account of their diversity. The EC recognises that SMEs require special attention in the Single Market and the Small Business Act is intended to provide guidelines and set out provisions tailored for SMEs. The new Act will be a comprehensive piece of legislation which will include under one law the piecemeal provisions concerning small businesses currently contained in various laws and policies of the EU.
The primary aim of the new proposal will be to reduce the administrative burden for SMEs and cut red tape as far as possible. Red tape and compliance with governments' bureaucratic formalities and regulations burden SMEs and obstruct their growth and success.
One of the proposals indicated by the EC for its new initiative is the setting up of "one-stop shops" in each member state where SMEs can find all the information they need about operating in other EU member states, thereby reducing obstacles to cross-border trade. The structure has already been put into place with the establishment of the Enterprise Europe Network, which will support business primarily SMEs.
SMEs will also benefit from this new proposal it aims at increasing their access and participation to EU programmes and funding. It will also aim to increase their share in public procurement by introducing measures to help boost SME participation in government tenders. Preferential treatment in the form of positive discrimination in favour of SMEs by reserving a share of public procurement contracts to SMEs has already been dismissed. The aim instead will be the increase will of transparency and information on public tenders. Taxation policies and practices in relation to SMEs will also be tackled. Competitive tax infrastructures will also be introduced in an aim to reduce the tax burden on enterprise.
The binding nature of this new initiative is still open for discussion. The view within the mainstream is that the new Act has to be more than a mere action plan or charter that sets out principles, but a legally binding document.
A consultation process is currently open with all stakeholders being urged to submit their view on developing a Small Business Act for Europe. The closing date for this public debate is March 31, 2008, and any contributions are to be sent by email on entr-sba@ec.europa.eu.
• Dr Grech is an associate with Guido de Marco & Associates and heads its European law division.