A number of EU member states have leaped to the defence of the ailing SME sector at a time when cashflow problems and red tape threaten to force small businesses into bankruptcy.
In its progress report on the implementation of the Small Business Act, the EU executive singled out Belgium, Denmark, Finland and Germany for subjecting all new legislation to an 'SME test' to ensure it is business-friendly.
The assessment strikes a more upbeat tone than that of business groups, which came together earlier this month to complain that member states have been dragging their feet in implementing reforms agreed in Brussels (EurActiv 03/12/09).
While SME lobby organisations are decidedly impatient with the pace of progress, the Commission is pointing to some tangible improvements in the business environment at a challenging time for companies and governments.
'Good progress' on Small Business Act
The Commission said there had been "good progress" on implementing the Small Business Act, adopted by enterprise ministers in 2008. Simplified state aid rules have allowed national governments to extend loans to struggling SMEs, while the European Investment Bank and Fund gave €11.5 billion to small firms in 2009.
Several governments have already committed to enforcing the revamped Late Payments Directive, which forces the public sector to pay contractors within 30 days. However, business groups have complained of major disparities across Europe – with authorities in southern European countries less likely to pay on time – and say the problem of late payments in the private sector has become worse this year.
The positive line taken by Brussels sparked frustration among business groups, who said they were "disappointed" that the EU was glossing over the bad news by exclusively promoting success stories.
Eurochambres, which represents chambers of commerce across Europe, described the report as "excessively positive" and at odds with feedback from SMEs at the coalface of the economic crisis.
Starting a business made simple
The EU report highlights a number of changes that make life easier for businesses and entrepreneurs. The fee for registering trade marks has fallen by 40%, while several countries have taken steps to make it easier for SMEs to access public procurement.
All member states have adopted national targets for reducing administrative burdens and continued to simplify the administrative environment for SMEs, according to a report published by the European Commission (15 December).
The average amount of time required to start a private limited company is now eight days, compared to nine days in 2008; and the average cost is €417, compared to €463 last year.
Bulgaria has consolidated the streamlining of start-up procedures initiated in 2008, with nine start-up procedures having been merged and simplified into just one. Germany has successfully amended the legislation for private limited companies, the European Commission says.
The streamlining of processes in Hungary, Malta and Slovakia has also contributed to time reductions in these countries. In Slovenia, an electronic 'one-stop-shop' system can register all forms of companies in three days or less, and has resulted in savings of €10.2 million a year for Slovenian SMEs.
Governments battle late payments
Business groups have consistently warned that member states are losing the ongoing battle against late payments, but the Commission says several governments are setting a good example in this area.
In France, a law to modernise the economy requires the term for public payments to be reduced to 30 days by 1 July 2010 at the latest. In Germany, a new law in force since 1 January 2009 improves the position of the creditor for 'business to consumer' contracts. In Portugal, the government has approved the programme 'Pagar a Tempo e Horas' to reduce payment delays, establishing a long-term target of 30 to 40 days, while in the United Kingdom, the government has committed to paying all bills within 10 days.
These modest reforms add up to a broad change in tone, according to the European Commission, and show member states are serious about putting SMEs at the centre of policymaking.
The new report came as the European Parliament passed a plan to establish a €100 million microfinance scheme to help boost employment and social inclusion. The new 'crisis tool' can be used to stimulate entrepreneurship and employment in companies with fewer than ten members of staff.
