Tuesday 10th July 2012 | 11:45
Support for Conservative MEP's proposal to free small businesses from red tape
Brussels, 10th July 2012 -- The smallest businesses across the EU should be exempted from burdensome legislation, unless the European Commission can prove the benefits to them: that's the call from a committee of MEPs who today supported a set of proposals for Better Lawmaking put forward by Conservative MEP Sajjad Karim.
Mr Karim is drafting a report which sets out a number of actions the EU must take in order to ensure that future legislation is proportionate and encourages decision-making to be taken at the lowest possible level (the so-called 'subsidiarity' principle). The Better Lawmaking report is critical of the European Commission for not fully respecting these principles when drawing up impact assessments for new legislation. It supports efforts being taken to increase transparency in the process whereby national governments transpose European law into national law, so as to prevent officials and ministers from 'gold plating' laws. It also calls for national parliaments to be given a longer amount of time to play a role in the legislative process.
The report specifically calls for the burden of proof to be reversed when legislating for 'micro-enterprises' (fewer that ten employees and turnover of less than €2 million per year). This would mean the commission would have to automatically exempt them from red tape, unless it can prove the benefits of including them. Karim warns that his call for exemptions for the smallest businesses should not be at the expense of more draconian legislation on medium-sized businesses. Instead, all legislation should be tailored according to the 'Think Small First' principle.
The report was adopted this morning by the parliament's legal affairs committee. It will now go to a vote in the full parliament.
Speaking after his report was adopted, Mr Karim (MEP for North West England) said:
"We need less regulation and better regulation that works with businesses, not red tape that strangles them.
"Our smallest businesses are the lifeblood of our economy. They should spend every hour working to build their businesses. Instead they spend far too much time untangling the web legislation that entangles them every day.
"This report sets out a number of ways the European Commission can ensure it proposes legislation that is proportionate, and it calls for better assessment on the impact that new laws could have on businesses.
"We want the commission to have to prove that its proposals would be beneficial to our smallest businesses, otherwise they should automatically receive an exemption. This does not mean the EU should start legislating only with multi-nationals in mind. Small and medium-sized businesses should be at the forefront of every legislator's mind when we pass legislation. However, often laws that may be applicable and necessary to a company with a hundred employees are merely burdensome red tape for a company with three.
"Ultimately growth and jobs are created by businesses. The greatest role government can play is to set the right conditions for them to sell their goods and services, and then get out of their way so that they can fulfil the tough task of dragging us out of our economic malaise."