Is EU Red Tape Choking Growth?

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After the last summit of EU leaders, David Cameron announced last June that he would assess the impact of EU regulation on firms. He commissioned a business taskforce including some of the UK’s leading figures, the chief executives of retailer Marks & Spencer as well as investors and entrepreneurs to further investigate the impact and consequences of the EU Red tape.

The report was drawn up by six UK business leaders and it is based on evidence from around 90 UK businesses and organisations as well as 20 from the rest of Europe. Now that the results of the so-called “Cut EU red tape” have been published, UK’s Prime Minister explained:

 “All too often, EU rules are a handicap for firms, hampering their efforts to succeed. (…) There are lots of simple and practical ways to cut EU red tape and save businesses across Europe tens of billions of euros.”

The business leaders involved in the report consider that no less than 30 rules should be scrapped or changed. Among them, they highlight the working hours and the hiring of agency workers, onerous environmental and food labelling rules and a proposal to require 20 weeks’ maternity leave on full pay.

Marc Bolland, chief executive of retail giant Marks & Spencer, said that it was aimed at reducing red tape faced by small businesses.

“We looked across the life-span of a business and at the regulatory barriers faced by small businesses and entrepreneurs, whether it is hiring people, developing cross-border trade, and then expanding. (…) It’s not our role to be political but to present the regulatory framework that faces businesses,” he told “The report is not our judgement as such but a reflection of over 100 business voices,” Bolland added.

Some of the proposals to EU Red tape are the following:

– Scrapping EU-wide requirements for small businesses in low-risk sectors to keep written health and safety risk assessments.

– Reforming employment law where it prevents firms from creating jobs, and abandoning plans to introduce complex new rules on employee consultation and subcontracting.

– Exempting micro-enterprises from all new employment law proposals where possible.

– Abandoning plans to force small businesses to pay fees to register to collect and transport waste.

– Abolishing these rules could benefit 460,000 small businesses in the UK and many more across Europe.

– Taking urgent action to simplify costly and complex chemicals regulation, which threatens the competitiveness of hundreds of small firms.

– Boosting e-commerce, including by simplifying labelling requirements and improving standards for cross-border parcel delivery.


You may read the “Cut EU red tape” report here.

About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.

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