Supporting innovative entrepreneurship and dismantling the obstacles to its development through improved access to finance and the single market, better connections between regional entrepreneurial ecosystems and raising awareness about the need to give failed but honest entrepreneurs a second chance are the objectives of an opinion drafted by Tadeusz Truskolaski (PL/EA). The members of the Committee of the Regions (CoR) adopted the opinion during their plenary session on 12 July in Brussels where they also announced the three winners of the 2018 European Entrepreneurial Regions (EER) award.

The EU has been developing SME and entrepreneurship policy tools over a decade which has over the last years led to a small start-up revolution in Europe. However, compared to countries like Switzerland, South Korea, Japan, China or the USA, Europe lacks companies able to substantially scale up their operations or even grow globally. With its new start-up and scale-up initiative the European Commission (EC) wants to give Europe’s innovative entrepreneurs every opportunity to grow and become successful worldwide, paying attention to the need for regionally interconnected EU-wide clusters and ecosystems.

” We have to work together and be even more ambitious and proactive if we want to build strong entrepreneurial ecosystems in our cities and regions. If companies find the right framework locally they can be successful globally. That’s why we need to create the right circumstances to allow the next generation of success stories to grow in Europe, stimulating growth and development across the entire Union “, said rapporteur Tadeusz Truskolaski (PL/EA), Mayor of Białystok.

The rapporteur highlights the lack of sufficient access to affordable long-term financing and the heterogenic laws in EU Member States – in particular the fragmented tax systems – among problems constraining European start-ups to expand. He also welcomes European Commission’s efforts to tackle the problem of ineffective and excessively long business insolvency proceedings in some EU Member States and its aim to give honest but over-indebted entrepreneurs a second chance. The CoR opinion therefore:

Suggests to create new opportunities through:

• Creating a start-up visa and a catalogue of conditions enabling a safe use of qualified intellectual and financial capital from third countries

• Additional funding for start-ups to develop and protect intellectual property rights

• Expanding the Enterprise Europe Network’s (EEN) range of services including advice on scaling up and cooperating more with local business incubators, science and technology parks

• Creating a separate instrument dedicated to networking projects in less-developed regions

• Encouraging new public procurement procedures exploiting the potential of start-ups and scale-ups

Welcomes the EC’s suggestions to facilitate access to finance through:

• Establishing a European venture capital fund of funds

• Creating innovation brokers linking buyers interested in innovative public procurement with innovative companies and helping them to access venture capital

• Increasing the budget for COSME, the EU’s main instrument supporting the competitiveness of SMEs

• Looking into the opportunities of and a regulatory framework for crowdfunding platforms

Welcomes the EC’s proposal on insolvency, restructuring and a second Chance and recommends to:

• Take greater account of related workers’ rights, proposing legislative amendments reflecting this recommendation

• Support financially the specialisation of judges and practitioners involved in insolvency procedures

• Raise public awareness what it means to fail, promote culture of rescuing businesses rather than liquidating

Central Macedonia, Ile de France and the Northern and Western Region of Ireland win EER 2018 award

Especially local and regional economies profit from strong SMEs that are able to establish themselves on the European Single Market. To support regional entrepreneurship the CoR has created the European Entrepreneurial Region (EER) award that yearly identifies and rewards three EU regions which show an outstanding and innovative entrepreneurial policy strategy, irrespective of their size, wealth and competences. For this edition Central Macedonia, Ile de France and the Northern and Western Region of Ireland convinced the EER jury with their credible, forward-thinking and promising plan for the year 2018. (EER) award that yearly identifies and rewards three EU regions which show an outstanding and innovative entrepreneurial policy strategy, irrespective of their size, wealth and competences. For this edition Central Macedonia, Ile de France and the Northern and Western Region of Ireland convinced the EER jury with their credible, forward-thinking and promising plan for the year 2018.

Carmen Schmidle
Tel. +32 (0)2 282 2366
carmen.schmidle@cor.europa.eu

Local and regional leaders call for smart regulation for SMEs

SME access to public procurement, the Single Market and finance, SME-friendly VAT and taxation rules and striking a better balance between SME needs and labour, consumer and environmental protection are critical factors behind SME success in Europe. The “smart regulation for SMEs” opinion of the European Committee of the Regions’ (CoR) rapporteur Christian Buchmann was adopted during the CoR plenary session on 12 July.

Small and medium-sized enterprises (SMEs) are the main engines for growth and jobs in Europe, creating two out of three jobs and generating more than half of Europe’s economic production. Nevertheless regulation doesn’t always take into account the SME-specific circumstances, thus hampering local economic growth and innovation.

“Red tape reveals itself as high administrative burden, incoherent requirements and overlapping or contradictory rules – and they have a much greater impact on SMEs than on larger firms. Also compliance in taxation, reporting and information obligations, labour protection or other fields affect SMEs disproportionally. Therefore an SME-friendly regulatory environment is an essential precondition for establishing and developing successful businesses and generating more jobs and growth in Europe”, said rapporteur Christian Buchmann (AT/EPP), Member of the Styrian Parliament.

The CoR proposal represents a medium-term approach that is more ambitious than current EU efforts to reduce red tape, for example the Better Regulation Agenda or the Regulatory Fitness and Performance Programme (REFIT). The opinion emphasises the importance of further reducing obstacles to SMEs in public procurement contracts – a particularly important issue for regions and cities – and simplifying and harmonising tax rules, which are seen as the most burdensome area by a majority of European SMEs.

The CoR also urges action to make it easier for SMEs to tap into the EU’s long-term regional-development instruments, like the European Structural and Investment Funds (ESIF), and highlights how a wide variety of national rules continue to prevent SMEs from profiting from the Single Market in services. It specifically calls for local and regional authorities to be given a role in the impact-assessment boards that scrutinise proposals from the European Commission.

” We need a coherent, visible and updated European SME policy, mainstreaming the “Think Small First” principle across all government levels and policies. The Small Business Act (SBA) should be revised and strengthened and cities and regions should have a stronger role in its revision and implementation. Instead of focusing on reducing regulations, we must stress creating a simple, clear and consistent regulatory environment for the SMEs – and here cities and regions play a key role “, stated rapporteur Buchmann.

Already since 2011 the CoR promotes the implementation of the Small Business Act (SBA) at regional and local level through its European Entrepreneurial Region (EER) award . The award is given each year to EU regions and cities that have the most promising, outstanding and innovative entrepreneurial policy strategies in Europe. It is an opportunity for local and regional actors to demonstrate how SMEs and entrepreneurs can increase the resilience of their economy.

Background:

The concept of smart regulation means delivering EU policies and laws that bring the greatest possible benefits to businesses, citizens and public bodies in the most effective way. It is a way of working to ensure that political decisions are prepared in an open, transparent manner, informed by the best available evidence and backed by the comprehensive involvement of stakeholders. Instruments include impact assessment, simplification, reduction of administrative burden and the full and correct implementation of existing legislation.

Contact:
Carmen Schmidle
Tel. +32 (0)2 282 2366
carmen.schmidle@cor.europa.eu