Press Release

Small business growth could offer way out of EU’s economic malaise

June 24 2008

Small businesses can help bring the European Union out of its economic malaise, but Brussels must take positive actions to help them fulfil their potential, the UK’s Federation of Small Businesses (FSB) said today.

The call comes ahead of tomorrow’s publication of the long-awaited EU Small Business Act. The Act will set a framework for how the European Union deals with small businesses, which make up 92 percent of all EU businesses. It is intended to embed the EU’s ‘think small first’ principle into future legislation to take account of the disproportionate burden that red tape often places on small enterprises.

The FSB has called for the Act to contain four ‘quick hit’ actions that would improve the environment for small businesses:

·       Regulatory exemptions for micro enterprises (ones employing fewer than 10 staff);

·       A small business element to impact assessments;

·       EU common commencement dates (single days when new regulations come into effect to give a clearer overview of the volume of legislation and allow businesses to plan ahead);

·       A consultation period of at least 12 weeks.

These four points are expected to feature in the European Commission’s draft. But the FSB is concerned that the draft contains too many caveats and is demanding the better regulation agenda be firmly set in stone when the Act is negotiated in the Council of Ministers during the coming EU French Presidency.

Tina Sommer, FSB EU and International affairs chairman, said:

“Small businesses will make a vital contribution to bringing Europe out of its economic gloom, but the EU must release them from their administrative shackles and allow them to fulfil their potential.

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

“As Europe’s economy continues to slow down, our message to the EU is: help small businesses to help you.

“This may be an act for small businesses, but it must have bigger ambitions and concrete actions to be considered worthwhile by Europe’s entrepreneurs.”