| Author (Corporate) | European Commission |
|---|---|
| Series Title | COM |
| Series Details | (2014) 212 final (09.04.14) |
| Publication Date | 09/04/2014 |
| Content Type | Policy-making |
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Improving the business environment for all companies, and in particular for SMEs, is one of the main priorities of the EU’s ten-year growth strategy, Europe 2020 - making business easier and better. A number of actions relevant to SMEs were set out in the Communication on “An Integrated Industrial Policy for the Globalisation Era”, one of Europe 2020’s seven key flagship initiatives. The review of the Small Business Act and the Single Market Acts I and II also included actions designed to improve access to finance and to further reduce the costs of doing business in Europe. Companies find it costly and difficult to be active across borders and only a small number of SMEs invests abroad. The reasons for this include the diversity of national legislations, in particular differences in national company laws, and the lack of trust in foreign companies among customers and business partners. In order to overcome the lack of trust, companies often establish subsidiaries in other Member States. The advantage of this being that they are able to provide customers with the brand and reputation of the parent company, whilst also offering them the security of dealing with a company which has the legal status of a national rather than foreign company. Establishing a company abroad involves, among others, the costs of meeting legal and administrative requirements in other countries, which are frequently different to what companies are used to “in the home country”. Those costs (including the additional necessary legal advice and translation) are likely to be particularly high for groups of companies, since any parent company, and particularly an SME parent, is presently faced with different requirements for each country in which it wishes to establish a subsidiary. European small and medium-sized enterprises (SMEs) have an essential role to play in strengthening the EU economy. However, they still face a number of obstacles, which hamper their full development within the Internal Market, and therefore prevent them from making their full potential contribution to the EU economy. The overall objective of this proposal, which provides an alternative approach to the SPE, is to make it easier for any potential company founder, and in particular for SMEs, to set-up companies abroad. This should encourage and foster more entrepreneurship and lead to more growth, innovation and jobs in the EU. In parallel to this proposal, the Commission is also carrying out related work aimed at improving legal certainty for companies and more generally regarding the law applicable to them when operating in other Member States, in line with the 2009 European Council’s Stockholm Programme on an open and secure Europe serving and protecting citizens. This proposal, once adopted, will repeal Directive 2009/102/EC and amend Regulation 1024/2012 in order to allow for the use of the Internal Market Information System (IMI). |
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| Source Link | Link to Main Source http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM:2014:212:FIN |
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| Subject Categories | Business and Industry, Law |
| Countries / Regions | Europe |
