Commission reviews EU risk capital strategy 

The European Commission reviewed its strategy on European risk capital and called for further actions to stimulate an innovative business environment. In a Communication to the Council, the Commission underlined the need to improve the conditions for the risk capital market in order to attract financing for young and innovative businesses.

The Communication is a follow-up to the demand by the Lisbon European Council in March of this year, to implement the so-called Risk Capital Action Plan (RCAP) by 2003. Together with the Financial Services Action Plan (FSAP) by 2005, the RCAP should foster an environment favourable to innovation in Europe.

In its Communication, the Commission identifies three priorities for EU member states:

• easing of quantitative constraints on institutional investment in equity capital,
• development of a fiscal framework more conducive to investment and entrepreneurship,
• softening of bankruptancy laws to allow failed entrepreneurs a second chance.