A new law on cross-border sales, due to be unveiled today (12 October), can help dig the EU out of the economic crisis, according to the Commissioner who will present it. Meanwhile business groups ralliy against the proposal, claiming it will hinder, not help small companies. 

"There is a lot of talk about crisis. Well, we give an answer to the crisis in order to stimulate trade, boost growth, and increase jobs," the European Commissioner for Justice, Viviane Reding, said at a briefing yesterday (11 October).

The proposal, seen by EurActiv, offers an optional - so-called 28th–regime - to a new sales contract for Europe that will enable individual traders to ‘opt-in’ to use the new instrument when they conduct cross-border sales.

The idea is that businesses which use the system can cut down on the legal costs incurred for adapting to 27 different contract laws as they will have just one system to adhere to.

According to the Commission's findings, only 1 in 10 companies trade across borders, which amounts to a €26 billion loss in potential capital a year.

A coalition of business lobbyists has spoken out against the proposal arguing that it will make the Single Market's legal challenges even more complex and costly as companies try to adopt it.

Meanwhile consumer groups argue that consumers will be left with less protection as businesses can chose between two systems and will likely opt for the law more favourable to them.

Reding yesterday sidestepped any criticism by reiterating that the law would be optional and run in parallel to existing national systems.

“Although the envisaged common sales law is optional, the alleged freedom for SMEs to take up this new regime can be questioned. If it gains popularity, commercial pressure will force small companies to use an instrument that is not balanced and unclear," Luc Hendrickx, Enterprise Policy Director for UEAPME, an SME lobby said in a statement.