The European Commission must convince people and businesses that the era of meddlesome EU regulation is over, Commission First Vice-President Frans Timmermans admitted today (26 May), before warning that would take “some time”.
Timmermans, in charge of the European Commission’s “better regulation” strategy, said the executive was embarking on a “sea change” in the way it approached legislation, as he launched an initiative to help SMEs negotiate red tape.
The new Innovation Deal pilot scheme aims to help SMEs navigate both national and EU regulation. It is open to companies that innovate in the circular economy but does not involve any EU funding.
Ironically, the better regulation strategy was behind the controversial decision to ditch and then rewrite the EU’s Circular Economy Package of waste and recycling laws.
The Innovation Deal scheme is a response to research that showed that almost two thirds of perceived regulatory barriers preventing ideas being brought to market can be overcome through better explanation.
Both Timmermans and Commissioner for Research, Science and Innovation Carlos Moedas admitted the perception of regulation and red tape remained a problem, even when it was not justified.
Burdensome EU regulation is often cited by as a reason for the UK to vote for Brexit in the 23 June referendum on its membership of the bloc.
The better regulation drive was in part motivated by British call for red tape to be slashed, and was among UK Prime Minister David Cameron’s demands for EU reform, as his price for campaigning for Remain.
Timmermans was asked if he wished that the better regulation drive had got more attention in the Brexit debate.
“At the end of the day, the appreciation for what we are doing needs to come from our customers – that is SMEs and citizens,” he said. “And it will take some time, especially for SMEs, to regain trust in the way we create legislation and regulation because they have become frustrated with the way that’s been done.”
“The only benchmark I have for this Commission is that at end of our mandate, SMEs across the EU will say okay things aren’t perfect’ but they are heading in the right direction. That will take some time and we have to be realistic about that.”
He added, “It’s a challenge for the institutions to work in a different way, especially politicians who think whenever there is a problem we can get rid of it with new legislation.”
Timmermans said that the British debate over Brussels red tape had been more nuanced than he had expected, even in traditionally Eurosceptic newspapers.
“I am actually quite surprised on how the debate has developed,” he said, “Even in The Daily Telegraph, there were articles saying hold on this isn’t all about Brussels red tape, this is stuff we’ve created ourselves, and by the way, to operate in European markets regulation is necessary sometimes.”
But he added, “What is sometimes presented at home as Brussels wants it, turns out to be something that was invented at home rather than Brussels.
“If we can get that clarified it, will help us inform SMEs as to whom they should direct their complaints.”
Hoovers, kettles and toasters
The Commission delayed the presentation of its ecodesign strategy until after the referendum. Ecodesign is a central part of the Circular Economy because it governs a product’s environmental impact and how easily its parts can be recycled or reused.
But British press reports suggesting that Brussels plans to meddle with kettles and toasters led to the plans being put on ice – a reaction to the outcry over regulation of inefficient hoovers.
“In politics, it is always nasty if you have to explain things because explaining away perception is always difficult. But my experience is if you take people through the reasoning of eco-design you co-opt them,” Timmermans said.
“I know it’s easy to make a caricature of toasters etc but look at the effect. Eco-design has led to saving energy to the amount of what Italy consumes in energy on a yearly basis.
“These are really important achievements especially if we want to make a success of what we agreed in Paris.”
Last December, world leaders in Paris agreed to cap global warming at below two degrees above pre-industrial levels.
The circular economy, which aims to make the most of finite resources in a world with a booming population, is part of the EU’s strategy to meet that Paris commitment.
The new Circular Economy Package calls for new markets to be created as part of the shift to the new economic model.
Commissioner Moedas said that the new scheme would give priority to companies that create new circular markets, rather than exploiting existing ones.
Up to five companies will be selected in the initiative, which is open for applications until 15 September.
The scheme, introduced in the margins of today’s Competiveness Council by Timmermans and Moedas, is based on voluntary guidance and cooperation between innovative entrepreneurs, regulatory authorities, and the Commission.
Work with the selected companies will begin in January 2017.
The Circular Economy Package was intended to increase recycling levels and tighten rules on incineration and landfill. It consists of six bills on waste, packaging, landfill, end of life vehicles, batteries and accumulators, and waste electronic equipment.
It was put together by the Barroso Commission, which said it would create €600 billion net savings, two million jobs and deliver 1% GDP growth.
In December 2014, the European Commission said it would ditch the Circular Economy Package, replace it with “more ambitious” legislation in 2015, as part of its better regulation strategy.
A year later the new package was proposed amid questions over its level of ambition on targets, but with an additional focus on the design of products.
The European Union's Ecodesign Directive introduced a framework to set mandatory ecological requirements for energy-using and energy-related products sold in the 27 member states.
Currently the scope covers more than 40 product groups, including boilers, lightbulbs and fridges that are responsible for 40% of the EU greenhouse gas emissions.
The aim of the directive is that manufactures of the energy-using products should, at the design stage, be obliged to reduce the energy consumption and other environmental impacts of products.
The European Commission planned to continue its work on ecodesign as part of the Circular Economy package, presented in December last year.
- 23 June: UK referendum
- 15 September: Deadline for applications to Innovation Deal programme
- Autumn: New ecodesign rules to be proposed
- January 2017: Programme begins