The “Small Business Act” for Europe, a review

February 24, 2011  |  Adoption, Electronic Invoicing

The “Small Business Act” for Europe (SBA) is a wide ranging set of pro-enterprise measures designed to make life easier for Small and Medium sized Enterprises (SMEs). The SBA seeks to promote entrepreneurship and anchor the “Think Small First” principle in law and policy making, thereby strengthening the competitiveness of European SMEs.

The SBA has been helping SMEs thrive since 2008. Between 2008 and 2010, both the Commission and the Member States focused on implementing actions set out to alleviate administrative burdens, facilitate SMEs’ access to finance (red: but as the banks didn’t want to provided loans this didn’t work out) and support SMEs’ access to markets.

I. The Achievements So far

  • The Directive on e-invoicing is particularly helpful to small businesses, by making e-invoices equal to paper ones.
  • Businesses with a turnover of less than €2 million may benefit from an optional cash accounting scheme which makes it possible for them to delay accounting for VAT until they receive payment from their customers.
  • Public authorities are required to pay within 30 days as a security guarantee for SMEs.

In the non-legislative area

  • 100 000 SMEs have benefited from the CIP financial instruments so far.
  • A further 200 000 SMEs are expected to benefit by 2013. On average, each SME that is granted a guaranteed loan creates 1.2 jobs.
  • SMEs now experience lighter administrative burdens when accessing public procurement and have better opportunities for joint bidding.
  • To facilitate SMEs’ access to third-country markets, the Commission opened in November 2010 a EU SME Centre in China.
  • The Commission has put entrepreneurs and SMEs at the core of its innovation and research policy. Its aim is to remove the remaining barriers for entrepreneurs to “bring ideas to market”.

II. Actions to boost SMEs
Despite these success stories much more needs to be done to help SMEs thrive and Member States must act as quickly and efficiently as possible in implementing the SBA. Some highlight

Actions by EC and the Member States work together on:

  • and strive to enhance electronic interoperability in the Internal Market, in particular delivering on the Single Market Act’s proposal for a decision by 2012 to ensure mutual recognition of e-identification and e-authentication across the EU
  • the revision in 2011 of the Directive on electronic signatures.

Some actions by the EC:

  • promote across the EU the “only once” principle when requesting information
  • simplify the EU accounting framework
  • help SMEs through a strengthened loan guarantee schemes
  • make EU funding programmes more accessible to SMEs by further simplifying  procedures
  • present an action plan for improving SMEs’ access to finance, including access to venture capital markets
  • explore options for setting up an intellectual property rights valorisation instrument at the European level, in particular to ease SMEs’
  • carry out an in-depth analysis of unfair commercial practices in the European Union
  • present a legislative proposal for a Common Consolidated Corporate Tax Base (CCCTB)
  • propose a new VAT strategy aiming notably at reducing tax obstacles and administrative burdens for SMEs
  • facilitate cross-border debt recovery;
  • undertake a revision of the European standardisation system in 2011:
  • propose an instrument of European Contract Law;
  • adopt, by end 2011, a Social Business Initiative focusing on enterprises pursuing social objectives

Actions to be set out by the Member States

  • systematically assess the impact of legislation on SMEs using an ‘SME test’
  • present at a defined moment of each year a forward planning of business related legislation
  • facilitate SMEs’ access to the Structural Funds
  • develop “credit ombudsman”-type solutions to further facilitate the dialogue between SMEs and credit institutions;
  • ensure that inconsistencies in tax treatment do not lead to double taxation
  • create one-stop-shops where SMEs can apply for European, national and local grants.
  • provide support to SME network-building,
  • fully implement the ‘European Code of Best Practices facilitating SMEs’ access to public procurement’ ;
  • promote the online publication of free abstracts of European standards
  • romote second chances for entrepreneurs by limiting the discharge time and debt settlement for an honest entrepreneur after bankruptcy to a maximum of three years by 2013
  • develop user-friendly and widely supported marketplaces and databases for transferrable businesses and provide training and support to increase the number of successful business transfers, including communication campaigns to raise awareness of the need for early preparation of business transfers.

More information

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