The recent review of the Small Business Act for Europe by the European Commission provides a ray of hope for European small and medium sized enterprises that not all will be gloom and doom in the years to come. Less bureaucracy, improved access to financing and harmonisation of tax systems across Europe are some of the measures being proffered by the Commission in its efforts to assist SMEs to recover from the economic crises that has engulfed them over the past years.
The Small Business Act for Europe, commonly referred to as SBA, adopted in 2008, consists of a wide ranging set of pro-enterprise measures designed to make life easier for SMEs. It seeks to promote entrepreneurship and anchor the “Think Small First” principle in law and policy making, thereby strengthening the competitiveness of European SMEs. At the time of its adoption, the SBA had foreseen a number of legislative initiatives which have actually been adopted along the years.
For example, the directive on e-invoicing is one such measure which is particularly helpful to small businesses, by making e-invoices equal to paper ones. Other non-legislative measures have also been implemented, such as the opening of an EU SME centre in China with the objective of facilitating access by SMEs to third-country markets. The recent review of the SBA by the Commission has identified new measures to respond to challenges which SMEs are currently being faced with.
The Commission seems to be all out to ensure that SMEs will have lighter administrative burdens to carry. Among some of the measures being contemplated, the Commission has asserted that it will seek to promote the application of the “only once” principle across the EU, whereby public authorities and administrative bodies should refrain from requesting the same information, data, documents or certificates which have already been made available to them in the context of other procedures. Furthermore, improving SMEs’ access to funding seems to be also a top priority for the Commission. It is aiming to help SMEs through strengthened loan guarantee schemes, that will support investments, growth, innovation and research and make EU funding programmes more accessible to SMEs by further simplifying procedures. Improving access to global markets for SMEs is also high on the Commission’s agenda.
Pursuing systematic efforts to eliminate non-tariff barriers in Free Trade Agreements and facilitate SMEs’ access to third countries are some of the initiatives that the Commission has promised to undertake. In order to encourage cross-border activity by SMEs, a number of measures are being contemplated among which is the contentious legislative proposal for an EU-wide corporate tax base. Other measures specifically intended to encourage entrepreneurs to start up and expand are being targeted. One such measure which is particularly worth mentioning is the creation of mentoring schemes for female entrepreneurs in at least 10 EU countries.
Although an estimated 99 per cent of EU companies are SMEs, only a fraction of such companies are run by women. To this end, the Commission is focusing on increasing the number of female entrepreneurs in an effort to raise the number of women in the workforce. Such schemes would focus on providing women with the necessary advice and support in relation to the start up, functioning and growth of their enterprises.
The Commission is now banking on the full cooperation of the member states in order to ensure the fulfillment of all these objectives.
Small as they may be, SMEs’ importance for the EU community can surely not be underestimated. Indeed, SMEs ensure the livelihood of many EU citizens, by providing around 70 per cent of EU jobs. It is therefore indispensable that both the EU institutions and the individual member states work together in order to ensure the survival of what can be termed the prime growth engine of the EU’s economy.
mariosa@vellacardona.com
Dr Vella Cardona is a practising lawyer and a freelance consultant in EU, intellectual property, consumer protection and competition law. She is also a member of the National Commission for the Promotion of Equality.