# EUR-Lex - 52012DC0795 - EN

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# 52012DC0795

**COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS ENTREPRENEURSHIP 2020 ACTION PLAN Reigniting the entrepreneurial spirit in Europe /* COM/2012/0795 final */**

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TABLE OF CONTENTS

1........... Our Challenge – More
entrepreneurs for Europe............................................................. 3

2........... Action Pillar 1 –
Entrepreneurial education and training to support growth and business creation           5

2.1........ New foundations: increasing the
prevalence and quality of entrepreneurial learning........... 5

2.2........ ...and new frontiers: higher
education for entrepreneurship............................................... 6

3........... Action Pillar 2 – Create an
Environment where Entrepreneurs can Flourish and Grow...... 8

3.1........ Better access to finance.................................................................................................. 8

3.2........ Supporting new businesses in
crucial phases of their lifecycle and help them grow........... 10

3.3........ Unleashing new business
opportunities in the digital age.................................................. 13

3.4........ Easier business transfers................................................................................................ 15

3.5........ Turning failure into success:
second chances for honest bankrupts.................................. 17

3.6........ Regulatory burden: clearer and
simpler rules.................................................................. 18

4........... Action Pillar 3 – Role models
and reaching out to specific groups................................... 21

4.1........ New perceptions: entrepreneurs as role models............................................................. 21

4.2........ New horizons: reaching out to
women, seniors, migrants, the unemployed, young people 22

4.2.1..... Women........................................................................................................................ 22

4.2.2..... Seniors......................................................................................................................... 23

4.2.3..... Migrant entrepreneurs................................................................................................... 24

4.2.4..... Unemployed, in particular young
people........................................................................ 25

5........... Conclusions.................................................................................................................. 27

Annex: Commission Key Actions................................................................................................ 28

Annex: Entrepreneurship 2020 Action Plan -
re-igniting the entrepreneurial spirit in Europe........... 28

COMMUNICATION FROM THE COMMISSION TO
THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE
AND THE COMMITTEE OF THE REGIONS

ENTREPRENEURSHIP 2020 ACTION PLAN

Reigniting the entrepreneurial spirit
in Europe

Since 2008 Europe has been suffering the
effects of the most severe economic crisis it has seen in 50 years: for the
first time in Europe there are over 25 million unemployed and in the majority
of Member States small and medium-sized enterprises (SMEs) have not yet been
able to bounce back to their pre-crisis levels.

Before the on-going economic and financial
crisis, the European economy faced structural challenges to its competitiveness
and growth, and obstacles to entrepreneurship. Many of these persist, but the
crisis has also been a catalyst for deep change and restructuring. The world
economy has also been transformed over the last decade. Rapidly increasing
demand and production in global markets has put pressure on resource and energy
supplies leading to changing cost structures for Europe's companies, many of
which are dependent on imports for these supplies.

The Europe 2020 Strategy responded to this
by setting out the foundations for future growth and competitiveness that will
be smart, sustainable and inclusive, and which would address our principal
societal challenges. Correcting the problems of the past and putting the EU on a
more sustainable development path for the future is a shared responsibility of
the Member States and the EU Institutions. Recognising that our economies are
closely intertwined, the EU is now reshaping its economic governance to ensure
better policy responses to current and future challenges.

To bring Europe back to growth and
higher levels of employment, Europe needs more entrepreneurs. As a follow up to the Small Business Act review of April 2011 and of
the Industrial policy communication adopted last October, the proposed Action
Plan sets out a renewed vision and a number of actions to be taken at both EU
and Member States' level to support entrepreneurship in Europe. It is based on
three pillars : developing entrepreneurial education and training; creating the
right business environment; role models and reaching out to specific groups.

1.           Our
Challenge – More entrepreneurs for Europe

Entrepreneurship is a powerful driver of
economic growth and job creation[1]: it creates new companies and jobs, opens up new markets, and
nurtures new skills and capabilities. In the field of industry for instance, it
is therefore particularly important to fast development of the six emerging
growth sectors identified in the Commission's Industrial Policy update[2]. Entrepreneurship makes
economies more competitive and innovative and is crucial in achieving
the objectives of several European sectorial policies.[3] Commercialising new ideas
improves productivity and creates wealth. Without the jobs from new firms,
average net employment growth would be negative[4].
New companies, especially SMEs, represent the most important source
of new employment: they create more than 4 million new jobs every year in Europe.[5] Yet the engine for this
recovery has been stuttering: since 2004, the share of people preferring
self-employment to being an employee has dropped in 23 out of the 27 EU
Member States.[6]
While three years ago for 45% of Europeans self-employment was their first
choice, now this percentage is down to 37%.[7] By contrast in the USA and China this proportion is much higher: 51% and 56% respectively. Moreover, when new
enterprises are founded, they grow more slowly[8] in the EU than in the USA or emerging countries, and fewer of them join the ranks of the world's largest
firms.[9]

The level of entrepreneurship and its
nature vary widely between Member States, and the reasons for low enthusiasm
for an entrepreneurial career are therefore diverse. Some Member States with
higher levels of entrepreneurship are less successful than others at helping
new and small enterprises to grow. Generally would-be entrepreneurs in Europe find themselves in a tough environment: education does not offer the right
foundation for an entrepreneurial career, difficult access to credits and
markets, difficulty in transferring businesses, the fear of punitive sanctions
in case of failure, and burdensome administrative procedures. The Annual Growth
Survey 2013 has recently emphasised the need to improve the business
environment to increase the competitiveness of EU economies. Furthermore, support
measures for SMEs remain unbalanced, with a substantial number of EU Member
States still neglecting to take into account the characteristics of small
businesses, in particular micro-businesses[10],
when designing legislation or not facilitating a second chance for honest
bankrupt entrepreneurs.[11]

Not only is the environment challenging, but there is also a
widespread culture that does not recognise or reward entrepreneurial
endeavours enough and does not celebrate successful entrepreneurs, as role
models who create jobs and income. To make entrepreneurship the growth engine
of our economy Europe needs a thorough, far-reaching cultural
change.

Against the background of the current
economic crisis and the new economic governance mechanism, this communication
further develops and accentuates action in those fields where the Commission's
Review of the Small Business Act[12]
identified a continued need for improvements on national and European level.

Each SME is different: their variations in size, field of activity
and legal form require the appropriately adapted attention of policymakers.'[13] This principle applies equally to liberal
professions and individual entrepreneurs who also
contribute significantly to the EU economy[14]. The
principle of "think small first" must become the touchstone of
European and national policies.

We must work on ensuring that being an entrepreneur is an attractive
prospect for Europeans. This also includes social entrepreneurs whose potential
is often underestimated[15].
They generate sustainable jobs and have demonstrated a stronger resilience to
the crisis than the general economy. Social
entrepreneurs are innovators, drive social inclusion and contribute to
achieving the objectives of the EU2020 strategy

The current situation can only be transformed with bold and
co-ordinated action by all administrations at European, national and regional
levels.

This
Action Plan is a blueprint for decisive joint action to unleash Europe's
entrepreneurial potential, to remove existing obstacles and to revolutionise the culture of
entrepreneurship in Europe. It aims to ease the creation of new businesses and
to create a much more supportive environment for existing entrepreneurs to
thrive and grow.

It
proposes three areas for immediate intervention:

1. Entrepreneurial
education and training to support growth and business creation

2. Strengthening
framework conditions for entrepreneurs by removing existing structural barriers
and supporting them in crucial phases of the business lifecycle,

3. Dynamising
the culture of entrepreneurship in Europe: nurturing the new generation of
entrepreneurs.

2.           Action
Pillar 1 – Entrepreneurial education and training to support growth and
business creation

2.1.        New
foundations: increasing the prevalence and quality of entrepreneurial learning...

Investing in entrepreneurship education
is one of the highest return investments Europe can make. Surveys suggest that between 15% and 20% of students who
participate in a mini-company programme in secondary school will later start
their own company, a figure that is about three to five times that for the
general population[16].
Whether or not they go on to found businesses or social enterprises, young
people who benefit from entrepreneurial learning, develop business knowledge
and essential skills and attitudes including creativity,
initiative, tenacity, teamwork, understanding of risk and a sense of
responsibility. This is the entrepreneurial mind-set that helps
entrepreneurs transform ideas into action and also significantly
increases employability.

Entrepreneurship is a key competence in the
European Framework[17],
and an action in both the recent Rethinking Education Commission Communication[18]. The role of entrepreneurship
as an instrument to improve employability levels is also stressed in the Annual
Growth Survey 2013[19].
A number of Member States have successfully introduced national strategies for
entrepreneurship education or made entrepreneurial learning a mandatory part of
curricula. but more is needed. Education should be brought to life through practical
experiential learning models and experience of real-world entrepreneurs.
Defined entrepreneurial learning outcomes for all educators are needed, to
introduce effective entrepreneurial learning methodologies into the classroom.

Practical entrepreneurial experiences can
also be gained outside education. Young people should be encouraged to develop
entrepreneurial skills through informal and non-formal education like
volunteering. Such experiences should also be validated and recognized, in
accordance with the proposed Commission recommendation in this area[20].

Partnerships with businesses can ensure
that education and training curricula are relevant to the real world.
Initiatives such as the VET[21]-Business
forum and Sector Skills Alliances[22]
provide routes to involve business. Education institutions should be encouraged
to become more entrepreneurial in their wider approach, to ensure that they
develop and live a culture of entrepreneurship and innovation through their
missions, leadership, stakeholder engagement, curricula and learning outcomes.

2.2.        ...and
new frontiers: higher education for entrepreneurship

The role of higher education in
entrepreneurship goes far beyond the delivery of knowledge to participating in ecosystems,
partnerships and industrial alliances. With high-tech and high-growth
enterprises increasingly becoming a focus of entrepreneurship-related public
policies, higher education institutions are an active component of the
innovation policies of Member States and EU.

The European Institute of Technology (EIT) has
pioneered the role of entrepreneurship as a key enabler of innovation on EU
level and is helping to bridge the gap between education and innovation for
industry. A number of start-ups have already been created out of the EIT's
Knowledge and Innovation Communities (KICs). EIT programmes ensure that
students are exposed to excellence-driven science with entrepreneurship
education, business creation services, and mobility schemes. Partnerships can provide a powerful platform for addressing the entrepreneurship skills of various sectors by
directly involving in the provision, application and updating of skills.

Universities
should become more entrepreneurial.[23]
Against this backdrop, the European Commission in collaboration with OECD has
already developed a framework for entrepreneurial universities. The framework
is designed to help interested universities assess themselves and improve their
capability with tailor-made learning modules. The access to the framework will
be expanded gradually.

The
Commission will:

·
Develop a pan-European entrepreneurial
learning initiative bringing together existing European and national expertise
for impact analysis, knowledge sharing, development of methodologies and peer
mentoring between practitioners from Member States.

·
Reinforce co-operation with the Member States
to assess the introduction of entrepreneurship education in each country based
on real experience and to support public administrations wishing to learn from
successful peers.

·
Establish, jointly with the OECD, a guidance
framework to encourage the development of entrepreneurial schools and VET
institutions[24].

·
Promote the recognition and validation of
entrepreneurial learning in an informal or non-formal learning environment[25].

·
Disseminate the entrepreneurial university
guidance framework in early 2013; facilitate exchange between universities
interested in applying the framework; gradually promote it to the EU Higher
Education Institutions;

·
Endorse successful mechanisms of
university-driven business creation (spin-offs etc.) and emerging
university-business ecosystems around key societal challenges.

The
Member States are invited to:

·
Ensure that the key competence
"entrepreneurship" is embedded into curricula across primary,
secondary, vocational, higher and adult education before the end of 2015.

·
Offer the opportunity to young people to have
at least one practical entrepreneurial experience[26]
before leaving compulsory education, such as running a mini-company, being
responsible for an entrepreneurial project for a company or a social project

·
Boost
entrepreneurial training for young people and adults in education by means of
Structural Funds resources in line with national job plan, .notably the European Social Fund (ESF) in line with
National Job Plans, particularly as a tool for second chance education
for those not engaged in education, employment or training. Take full advantage
of the training possibilities available under the rural development fund - European
Agricultural Fund for Rural Development (EAFRD).

·
Promote entrepreneurial learning modules for
young people participating in national Youth Guarantee schemes.[27]

3.           Action
Pillar 2 – Create an Environment where Entrepreneurs can Flourish and Grow

New businesses need specific care. There
are six key areas where action is needed to remove existing obstacles
impeding their creation and growth:

·
Access to finance

·
Support for entrepreneurs in
the crucial phases of the business lifecycle and their growth

·
Unleashing new business
opportunities in the digital age

·
Transfers of businesses

·
Bankruptcy procedures and
second chance for honest entrepreneurs

·
Regulatory burden reduction.

3.1.        Better
access to finance

Without adequate
funding and without liquidity, no business can operate, invest and grow –
indeed, access to finance is one of the levers for growth for SMEs.[28] According to a public
consultation launched by the Commission in July 2012, access to finance
constitutes one of the most significant constraints on growth and
entrepreneurship in Europe. SMEs have historically relied on bank lending and
consequently the current bank credit constraints due to the crisis have a
disproportionate impact on SMEs. In addition to this, entrepreneurs
particularly have difficulties raising finance in the early stages of their
businesses. In December 2011 the European Commission presented an Action
Plan to improve access to finance for SMEs[29]
and proposals on venture capital funds and social entrepreneurship funds.[30] Particular attention has also
been given to SMEs in Financial Instruments Directive[31] and in the final negotiations
on Capital Requirements Directive[32].
However, more must be done at both European and national levels to overcome
market deficiencies, including exploring alternatives to bank lending for SMEs,
to complement the limited private financing available and to make information
on funding more easily available.

It is also
important to increase the quality and financial returns of start-up projects. Financial
support for testing, demonstrating and piloting
new technologies, strengthening venture capital, angel investments,
incubators and loans for high potential SMEs are some of the areas where
action is possible. Entrepreneurs need funds to commercialise research
and development and test innovative business models. Support for these
areas is proposed by the Commission under the future Programme for the Competitiveness of
Enterprises and SMEs (COSME)[33] and Horizon 2020, and are reinforced
under the European Structural Funds[34].

Social
economy actors and social enterprises are important drivers of inclusive job
creation and social innovation. While they face similar problems as most SMEs,
they may encounter additional difficulties, accessing finance which the
Commission addressed in the future Programme for Social Change and
Innovation (PSCI) as well as in the Structural Funds regulations[35].

An
important component of a successful entrepreneurial ecosystem consist of an
array of early stage investors (venture capitals and business angels) that
provide seed and first round equity investments. These investors use an
extensive network of peers and provide valuable knowledge and support about the
market and the development of the venture "smart money". These investments
may also be spurred by fiscal incentives.

In 2008 the
Commission created the Enterprise Europe Network, a partnership with
over 600 hosting organisations, one of whose tasks is to provide businesses and
would-be entrepreneurs with the necessary information on access to EU funding
and EU finance. To date, better information on EU support is still a major
business request. The Commission is working, together with stakeholders, to
strengthen the Network to make it more active and effective.

The
Commission will:

·
Finance programmes aimed at developing a
market for microfinance in Europe, through initiatives as Progress Microfinance
and the Joint Action to Support Microfinance Institutions (JASMINE) initiative
and make resources for micro-financing available to Member States and regions
via the European Social Fund or the European Regional Development Fund.

·
Facilitate the direct access of SMEs to the
capital market through the development of an EU regime for venues specialised
in the trading of shares and bonds issued by SMEs ("SMEs growth
markets"), in the context of the review of the Market in Financial
Instruments Directive (MiFID)

The
Member States are invited to:

·
Assess the need of amending current national
financial legislation with the aim of facilitating new, alternative forms of
financing for start-ups and SMEs in general, in particular as regards platforms
for crowd funding, as well as consider the need for simplification of tax
legislation to stimulate further development of alternative financial markets
like for example business angel investments.

·
Make use of structural funds' resources to
set up microfinance support schemes under the respective investment priorities of
the European Social Fund (ESF) and the European Regional Development Fund
(ERDF).

·
Utilise the full potential under the EAFRD to
ensure access to financing of entrepreneurship, in particular at an early stage
of the business in agriculture (such as setting up of young farmers) and in
rural areas in general, also by means of financial instruments.

3.2.        Supporting
new businesses in crucial phases of their lifecycle and help them grow

About 50% of new businesses fail during
their first five years. If European entrepreneurs are to be able to deliver
the growth we expect from them, we must devote greater resources to helping
them to get through this period. Businesses often
lack an appropriate ecosystem that will enable them to grow.

Vital lifelines can be provided by support
services that know their markets and thus significantly increase the success
rate of new enterprises. Effective support consists of holistic programmes that
integrate the essential elements like management training, R&D coaching,
and networking with peers, potential suppliers and clients. Entrepreneurs
increasingly need advice and support in dealing with resource constraints and
supply insecurity through strategic investment and product development. Many
smaller enterprises are also under increasing pressure from the companies they
supply to meet new standards and design requirements linked to improved
resource efficiency and recyclability.

Reducing tax compliance costs would
improve the business environment, in particular for small firms. Given their limited resources and experience, small and newly
created businesses suffer more from high compliance costs arising from complex
tax legislation and cumbersome tax reporting procedures than large corporations
do. Member States should also consider simplifying VAT registration procedures
and create one-stop electronic registration to facilitate cross-border digital
commerce by small businesses.

Many new ideas for successful businesses
come from science and research but more can be done to make business use
research results. Therefore more information on the insights from projects
financed by the Framework Programmes for Research and Development should be shared
with businesses.

New businesses often fall victim to misleading
marketing practices. They range from providing false or misleading
information about the service to sending offers disguised as invoices or
misleading forms asking for updates in business directories. The Commission
published a strategy[36]
with a detailed list of actions for the future to increase the protection of
businesses, and it intends to present a legislative proposal in the course of
2013.

Removing obstacles to the Single Market
and thereby creating a level playing field will help small businesses develop
cross-border activities. This includes tackling
double taxation and removing tax mismatches and other tax measures that
constitute cross border obstacles on the single market and for foreign
investment in the EU.

Moreover, in most of the EU, the legal
frameworks for social security of self-employed persons differ substantially
from that for the employed, creating additional barriers to entrepreneurs.
Support for new business is particularly important for transitions from
unemployment to self-employment. Arrangements to make it easier for people who
depend on welfare benefits (such as unemployment benefit) to start their own
business and become economically independent (welfare bridges) can help.
Therefore, Member States could explore the possibility for the self-employed to
receive benefits (e.g. health, retirement, disability, unemployment benefit in
case of business closure/bankruptcy, etc.) that are comparable to the benefits
for employed workers without reducing those of the latter.

To thrive, entrepreneurs and SMEs need
specific, customised expertise that can help them develop competitive
advantages and benefit from global value chains and shared management of human
resources. Clusters, business networks and other types of association of
enterprises can provide such supportive environments as they bring together the relevant actors from business,
education, research and the public sector[37]. Among SMEs, some companies, such as social enterprises,
often have specific business models requiring dedicated support schemes. Grouping SMEs may lead to an increase in competitiveness.[38] Therefore, Member States could
consider whether their tax regimes could be improved to allow for more such SME
groups.

Additionally, entrepreneurs can greatly
benefit from the Single Market. However, at the moment, the good operation of
the Single Market is still hampered by some barriers. On the 3rd of
October 2012 the European Commission issued the Single Market Act II[39] to reduce current barriers. Effective
implementation of these measures can promote entrepreneurship in Europe, in areas such as cross-border services, recognition of diplomas and qualifications,
and right of establishment.

Moreover, exchanges with knowledgeable
entrepreneurs within the EU should be encouraged, such as through
the Commission's Erasmus for Young Entrepreneurs (EYE) scheme.

The
Commission will:

·
Identify and promote Member States best
practices with a view to create a more entrepreneur-friendly fiscal
environment.

·
Support the cooperation between clusters and
business networks;

·
Support the networking and exchange of best
practice between agencies running schemes on resource efficiency for SMEs;

·
Reinforce the partnership of the Enterprise
Europe Network with hosting organisations, the Single Points of Contact and all
SME support organisations to (i) widely spread information on EU initiatives,
on sources of finance, and on support for innovation, (ii) encourage Member
States to reinforce measures to increase investment readiness of entrepreneurs
and SMEs and (iii) provide effective assistance to help businesses fully
benefit from the Single Market and help access markets in third countries.

·
Revise the rules prohibiting certain
misleading marketing practices[40] to
make them more robust and strengthen enforcement against such practices in
cross-border cases.

·
Unlock the full potential of the Digital
Single Market for SMEs by tackling existing barriers to cross-border online
business.[41]

·
Continue the development of the Erasmus for
Young Entrepreneurs programme to meet the increased demand for participation
from new entrepreneurs across the Single Market[42]

·
Encourage exchanges of young entrepreneurs
between the EU and third countries

·
Help Member States develop integrated support
schemes through capacity building seminars financed by ESF technical
assistance, involving relevant stakeholders including education and training
providers to develop integrated strategies and setting up of specific actions,
notably for young entrepreneurs.

·
Continue to develop the Your Europe Business
portal with information on the Single Market from both the Commission and Member States.

The
Member States are invited to:

·
Make the national tax administration
environment more favourable to early stage business. Reduce the cost of tax
compliance by simplifying tax filing and tax payment, by extending the use of
electronic means, including speeding up the full implementation of the Digital
Single Market.

·
Promote tax coordination to ensure that
inconsistencies in tax treatment do not lead to double taxation or other
harmful tax practices that impede the Single Market by hampering cross-border
businesses and cross-border venture capital investments.

·
Reassess corporate income tax regimes to
consider extending the statute of limitation of losses and deductions in the
Corporate Income Tax.

·
Consider implementing as from 2013 the option
offered for small businesses of a cash accounting scheme for VAT.

·
Adopt the necessary measures to support the
commercialisation of innovation, research and development projects taking into
account the special challenges of newly established firms.

·
Consider the option for owners of new enterprises
to request possible adjustments of payment schedules for social contributions
for a limited time and based on the specific situation of the firm and sound
justifications.

·
Take full advantage of the newly introduced
support options under the European Agricultural Fund for Rural Development (EAFRD)
for business start-up and development of comprehensive schemes for professional
exchange of entrepreneurs and farm visits, also supporting clusters, business
networks and co-operation activities in agriculture, forestry, agro-food
processing and among rural non-agricultural businesses.

3.3.        Unleashing
new business opportunities in the digital age

Better use of information and
communication technology (ICT) can significantly help new businesses to thrive. ICT is the key source of growth for national economies and
European SMEs grow two to three times faster when they embrace ICT. As indicated in the Commission Industrial Policy Communication[43], "entrepreneurs need
to exploit the full potential of the digital single market in the EU that is
expected to grow by 10% a year up to 2016."

Based on the Digital Agenda and the Industrial
policy flagship initiatives, the Commission will help entrepreneurs and
SMEs to fully exploit the potential of ICT, both in terms of supply of
new digital products and services, and in terms of demand and
smart use of these technologies.

On the supply side, Web entrepreneurs constitute
a specific category of entrepreneurs who create new
digital services and products that use the web as an indispensable component. Web
start-ups tend to grow and fail faster than other businesses and scale
exponentially, which translates into higher rewards but also higher risks. They
operate in a complex and fast moving eco-system, where networking and
experimenting is paramount. Web start-ups are cheaper to set-up and the entry
barriers are low, making them an attractive vehicle to start an entrepreneurial
career. Web entrepreneurs require for that reason tailored support measures to
structurally strengthen the web start-up ecosystem.

On the demand side, investing in digital
technologies is no longer a choice: companies can nowadays only be
competitive when they embrace the digital world. This
poses opportunities and challenges, in particular for SMEs, since they are
often less equipped to deal with the increased sophistication of new business
models.

Digital entrepreneurs are those
entrepreneurs that fully exploit digital products and services, including "cloud
computing", to reinvent their business models and sharpen their
competitiveness[44].
The EU initiatives “Smart
use of information technologies and the integration of SMEs in global
industrial value chains”, and e-Skills will promote the
uptake of digital technologies and connect SMEs to the digital world.

The potential of
e-commerce as a part of the Digital Single Market opportunities for
entrepreneurs is still not fully tapped. A number of specific actions will
enhance trust towards online trade.[45]

The Commission
will:

·
Foster the knowledge base on major market trends and innovative business models, by
establishing an online Market Monitoring Mechanisms and a Scoreboard, in
cooperation with the main stakeholders, to facilitate dialogue and lead to a
shared agenda for action.

·
Raise awareness through a Europe-wide information campaign for entrepreneurs and SMEs on
the benefits from the new digital evolutions; the campaign will promote
European success stories, pan-European contests and prize award schemes to
sensitise entrepreneurs on the changing business landscape and new business
opportunities.

·
Facilitate networking to sparkle and support new business ideas, such as: the creation of
a European Mentors Network for training, advice and hands-on coaching on
how to do business in the digital age, and match-making events among
stakeholders to explore new partnerships.

·
Launch specific actions for Web entrepreneurs such as: i) a Start-up Europe
Partnership to unlock expertise, mentoring, technology and services, ii) a Web
Entrepreneurs Leaders Club to bring together world-class web entrepreneurs and
strengthen the web entrepreneurial culture in Europe; iii) a European network
of web business accelerators; iv) work with European investors in order to
increase the flow of venture capital and crowd-funding into web start-ups; and
v) Fostering web talent by stimulating the emergence of Massive Online Open
Courses[46]
and the setting up of platforms for mentoring, and skill building.

·
Strengthen competences and skills by intensifying its E-skills actions to improve e-leadership skills,
scientific and creative disciplines, and managerial and entrepreneurial skills
to address new technological and markets.

The Member
States are invited to:

·
Reinforce national or regional support for digital
and web start-ups and foster alternative financing for early-stage technology
start-ups, such as ICT innovation voucher schemes.

·
Promote access for
entrepreneurs to Open Data and Big Data compiled in public or industry-backed
programs such as the cultural data set Europeana. [47]

·
Support the most talented
entrepreneurs, e.g. by encouraging, the brightest graduates to begin their
career in start-ups.

·
Support the swift
adoption of on-going policy initiatives such as the data protection reform and
the proposal for a Common European Sales Law which will lower barriers to the
uptake of cloud computing in the EU.

·
Ensure the best use of
European funds for web and digital entrepreneurship according to the applicable
rules and priorities.

3.4.        Easier
business transfers

Every year approximately
450,000 firms with 2 million employees are transferred across Europe. Yet it can be so difficult to make a transfer that an
estimated 150,000 companies with 600,000 jobs may be lost each year.[48] The main factors of this are
regulatory or tax burdens, lack of awareness of needed
preparations and of transparent
markets for such transactions, and the long time
periods needed to comply with formalities. Moreover,
the legal form of a company (sole proprietorships) as well as its age
(especially companies less than three years old) are additional elements of
vulnerability. That's why the smallest businesses are the most exposed to failed transfers.

These businesses are 'going concerns' with
established products, markets and customers and so have a higher probability of
survival than new firms. Would-be entrepreneurs should know that the acquisition
of a 'going concern' may be an attractive alternative to starting a new
business. Transfers should be made easier for both the entrepreneur
who wishes to pass on his or her business and the acquirer.

Transferring a business from one generation
to the next is the defining feature of a family business and the greatest
challenge that it can face. A family business transfer must be considered as a
transfer of ownership, where that ownership is not a liquid asset but something
which is built up and developed by the family over generations, including
values, traditions and know how. The scope and scale of diverse approaches to
inheritance and estate taxes across the EU demonstrate that there is still much
room for improving the legal climate for family business transfers.

The area of business transfers has been specifically
addressed by the Small Business Act (SBA)[49] and the Review of the SBA
for Europe of 2011[50] and was specifically addressed in the Commission Communication
of 2006, "Implementing the Lisbon Community Program for Growth and
Jobs: Transfer of Businesses - Continuity through a new beginning"[51].

Although some European countries have made
progress and a more transfer-friendly regulatory framework has been developed,
even in those countries there may still be low awareness of the
entrepreneurial community and stakeholders (professional associations,
legal firms and consultants to entrepreneurs) about possibilities for transfer and
about needed preparations.

As the barriers to successful business
transfers are largely to be found at local, regional and national levels, it can
clearly be worthwhile comparing approaches across Europe with a view to
exchanging best practices and to take actions, notably
in terms of awareness raising for business transfers, special financial
facilities designed to finance transfers, legal transformation (notably the
possibility to create public limited companies facilitating the selling of a
firm) and transparent markets for business transfers.[52]

The
Commission will:

·
Develop guidelines on the most effective
programmes and best practices to make business transfers easier, including
measures for deepening and expanding the markets for enterprises, mapping
available programmes in Europe and proposing necessary actions to remove
remaining possible barriers to cross-border business transfers. To this effect,
the Commission is organising an expert working group with Member States
representatives which in 2013 will aim at performing a stock-taking and
analysis of the reasons for remaining barriers in this area and proposing
recommendations and support measures addressing these barriers.

The
Member States are invited to:

·
Improve legal, administrative, and tax provisions
for transfers of business taking into account the 2006 Commission Communication
on transfers of businesses and the 2011 Commission Communication on tackling
cross-border inheritance tax obstacles within the EU[53].

·
Use existing European funds according to
their applicable rules and priorities to support transfers of small and
medium-sized businesses to entrepreneurs intending to continue running the
business.

·
Improve information and advice services for
business transfers as well as improve data collection on and monitoring of
business transfers.

·
Effectively publicise business transfer
platforms and marketplaces and launch campaigns to raise awareness among
potential sellers and buyers of viable businesses.

·
Consider reviewing tax regulation with respect
to its impacts on the liquidity of a small or medium-sized family business in
case of a succession of ownership without impacting revenues negatively.

3.5.        Turning
failure into success: second chances for honest bankrupts

Business failure, like business creation,
is part of a dynamic, healthy market. Evidence shows that by far the
majority (96%) of bankruptcies are due to a string of late payments or other
objective problems – they are, in other words 'honest failures', without
any fraud by the entrepreneur.[54]
Entrepreneurs are nevertheless treated by many bankruptcy laws as if they were
fraudulent, having to go through complex procedures before they can be
discharged. In some Member States the procedure may take such a long time that
entrepreneurs will not consider another business venture[55]. In some cases they may be
legally barred from starting a new enterprise for much or all of their
lifetimes.

Even after a discharge, former bankrupts
are stigmatised and have difficulties financing a new enterprise. Therefore,
many potential entrepreneurs simply give up and do not consider trying again.

Yet research shows that 'second
starters' are more successful and survive longer than average start-ups; they
grow faster and employ more workers[56].
Thus, a failure in entrepreneurship should not result in a "life
sentence" prohibiting any future entrepreneurial activity but
should be seen as an opportunity for learning and improving – a viewpoint
that we already today fully accept as the basis of progress in scientific research.
Consequently, any move to encourage a new generation of entrepreneurs must
include reassurance that, if their first idea does not fly, they will not be
forever barred from trying to 'take off' again. Thus bankruptcy laws must
provide for swift, efficient ways of lodging and recovering claims for creditor
enterprises, while faster and more affordable procedures for winding up
businesses and for discharge from bankruptcy should be put in place.

The Commission adopted last December a
Communication on a new European approach to business failure and insolvency[57] to create a more business
friendly environment, for example by improving the efficiency of national
insolvency laws including the length and costs of the period of discharge from
bankruptcy. As a first step to be taken, the Commission also adopted at the
same time a proposal for the modernisation of the Regulation on insolvency
proceedings[58]
which will ensure cross-border recognition of the rescue of enterprises and
also includes facilitating the lodging of claims in another Member State.

The
Commission will:

·
Launch a public consultation so as to receive
views from stakeholders on the issues identified in the Communication on a new
European approach to business failure and insolvency, including on giving
honest bankrupts a second chance and on shortening and aligning the "time
to discharge".

The
Member States are invited to:

·
Reduce when possible, the discharge time and
debt settlement for an honest entrepreneur after bankruptcy to a maximum of
three years by 2013. [59]

·
Offer support services to businesses for
early restructuring, advice to prevent bankruptcies and support for SMEs to
restructure and re-launch.

·
Provide advisory services to bankrupt
entrepreneurs to manage debt and to facilitate economic and social inclusion
and develop programmes for 'second starters' for mentoring, training and
business networking.

3.6.        Regulatory
burden: clearer and simpler rules

Entrepreneurs should be the 'normal
customer' for whom administrations benchmark their procedural requirements and yet nearly three-quarters of Europeans consider it too
difficult to start their own business because of administrative complexities[60]. Many more complained about
heavy regulatory burdens imposed on the running of a business. Aware of this,
in 2007 the Commission committed to an Action Programme to cut red tape
stemming from EU legislation by 25% before the end of 2012[61]. In November 2011 the Commission adopted its Report on minimising
regulatory burden for SMEs – adapting EU regulation to the needs of
micro-enterprises,[62] which
extended the focus to a far wider range of all regulatory burdens beyond the
administrative burden of reporting to authorities, and introducing the
principle of reverse burden of proof for any new regulatory burden. It also
committed the Commission to improved consultation with smaller businesses and
the adoption of an annual scoreboard on progress towards implementation in
Member States.

The Commission has tabled proposals
beyond the target of 25% reduction Measures worth
EUR 30.8 billion in annual savings for businesses have been adopted by the EU
legislator. This represents 25% of the regulatory burden, which has been
estimated at EUR 123.8 billion. Another 5.5% of burden reduction could be
achieved if the additional proposals tabled by the Commission were adopted by
the European Parliament and Council.

Notable savings have been realised in the
areas of tax law (moving from paper to electronic billing) and company
law (exceptions for micro-enterprises from some provisions on financial
reporting obligations). For instance, the Invoicing Directive[63] has created equal treatment
between paper and e-invoices and no longer allows Member States to prescribe a
certain technology for e-invoices[64].
Progress has also been made in modernising customs legislation, reducing
statistical reporting obligations on SMEs, and an extensive range of areas
across the Member States.[65]

Reducing unnecessary
or excessive regulatory burden remains on the top of the Commission’s political
agenda. To
this effect, in addition to conferences being held in Member States, on 1
October 2012 a public consultation was launched to identify the ten most
burdensome pieces of EU legislation[66].
The outcome of this consultation, together with more specific analysis, will be
taken into consideration when assessing the need for reviewing EU regulation in
specific areas.

Regulatory obligations of businesses
should be clear and simple. In addition to
protecting public and workplace health and safety and the environment, clear
regulatory frameworks ensure a level playing field, fair and free competition,
business certainty and market predictability. Smart regulation can also drive
innovation putting European Companies in the lead in key technologies and
services. However, duplicative or uncoordinated licensing should be eliminated.
Similarly, burdensome formalities such as the request to prove the authenticity
of public documents (e.g. corporate records), should be eliminated for business
activities inside the Internal Market.

Red tape should be eliminated or reduced wherever possible for all businesses and particularly for
micro-enterprises including the self-employed and the liberal professions,
who are exceptionally vulnerable to the burdens of bureaucracy due to their
smaller size and limited human and financial resources. At the same time, remaining undue and unjustified barriers to entry
in liberal professions should be removed.

In the area of public procurement SMEs and
cross-border bidders are hampered by administrative requirements (e.g.
provision of evidentiary documents), problems in obtaining information and
sometimes disproportionate requirements by contracting authorities. The share
of SMEs winning public procurement contracts has not changed significantly
since 2002. The most significant factor affecting SME participation is the size
of a contract – SMEs do not have the capacity to bid for or fulfil requirements
of large public contracts and in general, contracts above €300,000 seem to be
beyond their capacity. Use of lots for contracts with a total value above
certain thresholds would increase the number of contracts accessible to SMEs.

Furthermore, the Commission recommends to
Member States to continue modernising labour markets by
simplifying employment legislation and developing flexible working arrangements,
including short-time working arrangements.[67]

In addition, businesses should be able to
count on expert advice and assistance whenever they face misapplied
Internal Market law, an area where the Commission's (SOLVIT) network has been
active for the last 10 years.

Entrepreneurs should also be able to
count on one single contact point to receive comprehensive information on
licenses, administrative procedures, finance and
public support. ‘One stop shops’ for entrepreneurs such as
"Barcelonactiva", winner of the 2011 European Enterprise Promotion
Award, should be expanded. Moreover, the Commission has recently launched a new
"Your Europe" portal which includes a
single access point on EU financial instruments[68]. More administrative procedures should be made available online for
businesses, including across borders. Member States are encouraged to extend
their Points of Single Contact set up under the Services Directive to more
procedures, to follow the business lifecycle approach, be multilingual and be
more user-friendly.

The
Commission will:

·
Continue to vigorously pursue the reduction
of regulatory burden in EU proposed legislation especially in areas where such
burdens are the highest.

·
Indicate how it will go about reviewing and
revising EU regulation to reduce the unnecessary or excessive burden in areas
identified in the' top ten most burdensome'. Legislative initiatives reducing
administrative burden in other areas will also be proposed, such as those
promoting e-invoicing in the field of public procurement and making business
easier through a standard VAT declaration[69].

·
Propose legislation abolishing burdensome
authentication requirements for public documents which SMEs have to produce to
conduct cross-border business within the Single Market.

·
Set up a working group to assess the specific
needs of liberal profession entrepreneurs in relation to issues such as
simplification, internationalization or access to finance.

·
Monitor progress via the Points of Single
Contact under the Services Directive and encourage Member States to take a more
business-oriented approach.

·
Take action to ensure
that more businesses get help through SOLVIT when their rights are denied in
the single market by public authorities. The Enterprise Europe Network should
assist business with a view to ensuring that they can effectively access and
make use of SOLVIT. Screen all existing resources for
entrepreneurs at the EU level, to ensure clarity and accessibility and avoid
duplication and outdated information.

The
Member States are invited to:

·
Reduce time for licensing and other
authorisations necessary to start a business activity to one month by the end
of 2015.[70]

·
Fully implement the ‘European Code of Best
Practices facilitating SMEs’ access to public procurement’ by 2013.

·
Continue modernising labour markets by
simplifying employment legislation and developing flexible working
arrangements, including short-time working arrangements.[71]

·
Extend the Points of Single Contact to more
economic activities and make them more user-friendly;

·
Set up "one-stop-shops for
entrepreneurs" to bring together all business support services including
mentoring, facilitation and advice on access to conventional and
non-conventional finance, access to 'incubators' and 'business accelerators' and
support for early internationalisation of young enterprises. All relevant
stakeholders should be involved to ensure a partnership approach, including
education and training providers.

4.           Action
Pillar 3 – Role models and reaching out to specific groups

4.1.        New
perceptions: entrepreneurs as role models

Europe
has a limited number of known entrepreneurial success stories. This is due to the fact that entrepreneurship has not been
celebrated as a preferred career path. It is rare in Europe to find
'entrepreneur' ranked highly among desirable occupations. Despite the fact that
entrepreneurs create jobs and power the economy their successes are not
presented as role models in the media. For young people, this makes an
entrepreneurial career rank rather low in the list of attractive professions
and it is a deterrent to those who might want to become entrepreneurs.

An important element to change the
entrepreneurial culture is thus a change in the perception of entrepreneurs
through practical and positive communication about the achievements of
entrepreneurs, their value to society and the opportunities of new business
creation or acquisition as a career destination. To achieve this, their
visibility as role models must be stepped up, taking into account the diversity
of entrepreneurial profiles and paths to success. Clear and engaging
information on the challenges and rewards of an entrepreneurial career can
counteract negative impressions. A corresponding broader discussion in public,
especially in the media, is thus essential for an entrepreneurial revolution.
Public and private institutions should be encouraged to emphasize the social
and economic importance of entrepreneurs not only as a legitimate career path
but also as a matter of utmost national, European and international interest.

The
Commission will:

·
Establish, in the framework of the "SME
Week", a Europe-wide "EU Entrepreneurship Day" for students in
their last year of secondary education. Events could include meetings with
entrepreneurs, case studies, lectures, workshops and "company open
days".

The
Member States are invited to:

·
Step up entrepreneurship promotion activities
and appoint known entrepreneurs as national Entrepreneurship Ambassadors to
become "the face of entrepreneurship" in their countries. Their role
will be to promote the value of entrepreneurship to society, emphasise the
importance of developing entrepreneurial skills and experiences in education,
and highlight entrepreneurship as a career opportunity.

·
Better take into account the variety of
business models and legal statuses in their national or local business support
schemes, and develop social entrepreneurship education and training.

4.2.        New
horizons: reaching out to women, seniors, migrants, the unemployed, young
people

Demographic groups that are
underrepresented within the entrepreneurial population and especially founders
of start-ups are young people, women, disabled and/or migrants. Europe has to open up for them paths into entrepreneurship to create for them jobs, empower
them economically and socially and leverage their creative and innovative
capacities. These paths should be sensitive to the needs of different groups,
their expectations and their norms with regards to how advice and information
is delivered and received. Actions should be based on an integrated support
scheme that promotes human capital, as well as providing financial support.
Besides specific activities adapted to the needs of each of these groups, they
should all be included into entrepreneurship training programmes that are
designed and offered in partnership with education and training providers,
youth organisations, mainstream business advisers and financial institutions.

4.2.1.     Women

Women constitute 52% of the total European
population but only one-third of the self-employed or of all business starters
in the EU.[72]
Women thus represent a large pool of entrepreneurial potential in Europe.
When establishing and running a business, women face more difficulties than
men, mainly in access to finance, training, networking, and in reconciling
business and family.[73]

Potential women entrepreneurs should be
made aware of business support programmes and funding opportunities.

In 2009 the Commission inaugurated the European Network of Female Entrepreneurship Ambassadors, to serve as
inspirational role models for potential women entrepreneurs. This was followed
in 2011 by the European Network of Mentors for Women Entrepreneurs, who
voluntarily counsel women starting and running new businesses. In 2012, the Commission made a proposal to improve the gender
balance in boards of publicly listed companies. Even though board membership
requires different competences and skills compared to entrepreneurship,
more women in senior management positions could serve as a role model for other
women in general. The visibility of bigger number of successful professional
women will show other women that they have chances of success on the labour
market.

Effective implementation of existing gender
equality legislation, in particular Directive 2010/41/EC[74] should further stimulate
female entrepreneurship.

The
Commission will:

·
Create a Europe-wide on-line mentoring,
advisory, educational and business networking platform for women entrepreneurs
that will bring the current national ambassadors and mentors networks on-line,
deepen their offer and expand their reach and support female entrepreneurship
at national and regional level by promoting the exchange of best practices
between Member States.

Member
States are invited to:

·
Design and implement national strategies for
women's entrepreneurship that aim at increasing the share of women-led
companies.

·
Collect gender-disaggregated data and produce
annual updates on the state of women entrepreneurs nationally.

·
Continue and expand the existing networks of
Female Entrepreneurship Ambassadors and Mentors for Women Entrepreneurs.

·
Implement policies enabling women to achieve
an adequate work-life balance, by establishing appropriate and affordable care
for children and elderly dependents, notably by taking full advantage of
support options under the EAFRD, ERDF and ESF.

4.2.2.     Seniors

Seniors are a valuable resource for
entrepreneurship. Between 1990 and 2010 the share
of citizens aged over 50 increased in Europe from 32.1% to 36.5% and the median
age of the European population is expected to rise for the coming decades. A
growing cohort of well educated, highly experienced adults is retiring every
year and to date society has not been innovative in occupying them and
benefitting from their know-how and skills. Engaging them in both business
creation and in supporting new and existing entrepreneurs would maximise the
wealth of experience they possess that can be lost on retirement, cultivate
intergenerational learning and ensure knowledge transfer.

As people live longer and healthier lives,
traditional models of and choices for retirement are beginning to change. Those
seniors who wish to start a business for the first-time should benefit from the
full range of existing support services.

Senior entrepreneurs can also be a valuable
resource for other entrepreneurs. Retired business
people have precious know-how and experience that can make it easier to start
and run a company than it might otherwise be for an inexperienced founder. This
knowledge represents valuable European intellectual capital and should be made
the most of. Europe could take inspiration from programmes such as 'Senior
Enterprise' (Ireland) and 'Maillages' (France) encouraging motivated seniors to
serve as voluntary mentors, potential buyers of or investors in businesses, or
as temporary managers to assist vulnerable start-ups or businesses in
transition.[75]

The
Commission will:

·
Help exchange best practices helping senior
executives and entrepreneurs to mentor new entrepreneurs as well as support
mutual and intergenerational mentoring between entrepreneurs, to exchange vital
skills, such as ICT literacy and the experience of seniors.

The
Member States are invited to:

·
Foster senior entrepreneurs interested in
transferring know-how to new entrepreneurs and match senior entrepreneurs with
inexperienced entrepreneurs to create teams with broader skill sets.

·
Ensure that the participation of senior
entrepreneurs and retired executives in projects is compatible with their
pension prospects.

4.2.3.     Migrant
entrepreneurs

Immigrants founded 52% of start-ups created in
Silicon Valley between 1995 and 2005 and Israel owes much of its success to its
immigrant population. According to the OECD, migrants are more
entrepreneurial than natives and a foreign-born self-employed person who owns a
small or medium firm creates between 1.4 and 2.1 additional jobs[76]. Migrants represent an important pool of
potential entrepreneurs in Europe. However, today
European migrant businesses are mainly micro-businesses
with no or very few employees. They are also small in comparison with
indigenous businesses as regards turnover and profit. Qualified migrants
populations often face legal difficulties, limited labour markets and career
opportunities that push them into self-employment. It should also be noted that
some third countries have a migration policy particularly attractive to
facilitate the arrival of entrepreneurs. The more
vulnerable groups of less qualified migrants should also be addressed.
Notwithstanding that migrants have higher business creation rates than the rest
of the population they fail more due to a lack of information, knowledge and
language skills[77].

The EU has publicly recognized the key
contribution that migrant entrepreneurs can make to sustainable growth and
employment. The European Agenda for the Integration of Third-Country Nationals[78] stresses the important role of migrants as entrepreneurs and states
that "their creativity and innovation capacity should also be
reinforced". It is important that policies to encourage entrepreneurship
in Europe take full account of the entrepreneurship potential represented by
this group. Highly-qualified non-EU nationals can already be admitted as
workers under the Blue Card Directive.[79] National
and European policies should also consider the potential of qualified migrants
for the creation of businesses and jobs. In particular, support measures and
policy initiatives should help attract talented would-be entrepreneurs wishing
to create global companies based in Europe.

The
Commission will:

·
Propose policy initiatives to attract migrant
entrepreneurs and to facilitate entrepreneurship among migrants already present
in the EU or arriving for reasons other than setting up business, building on
the best practices developed in the Member States, including by local
authorities.

·
Analyse the opportunity of proposing
legislation aimed at removing legal obstacles to establishment of businesses
and giving qualified immigrant entrepreneurs a stable permit.

The
Member States are invited to:

·
Remove legal obstacles to establishment of
businesses by legal migrant entrepreneurs, such as considering initiatives to
give to qualified immigrant entrepreneurs or immigrant graduates of a European
university-level institution a stable permit to allow them to set up a business
in Europe, which can be extended if pre-defined targets in terms of
job-creation, turnover or raising of new funding are achieved.

·
Facilitate access to information and
networking for migrant entrepreneurs and prospective migrant entrepreneurs by,
e.g., creating relevant information centres in areas densely populated by
migrants.

4.2.4.     Unemployed,
in particular young people

Given the significant number of unemployed
people across Europe, entrepreneurship support schemes should be put in place to
encourage business creation as a route out of unemployment.[80] Few business development
support schemes target unemployed youth specifically.[81]

All business development support should
include signposting information and providing links to support services, advice
and counselling, and business coaching and mentorship. Such assistance may also
extend to the provision of particular skills (e.g. opportunity recognition,
business planning, financial management, sales and marketing), delivered either
informally (e.g. mentoring scheme) or more formally by attending a course. Support should be targeted at groups with the greatest potential
(such as unemployed workers with professional skills, women or young people),
and should rely on close co-operation between employment services, business
support and finance providers. The goal is to help the
unemployed make an effective transition into self-employment, increase the
sustainability of their businesses, and to tailor support to groups who may
require additional resources such as young people or those who may not be best
reached through traditional channels of business support.

Attention should also be paid to the
unemployed in general, in particular those who already possess skills and
competences that could be transferred through business coaching and mentorship
to self-employed businesses.

The
Commission will:

·
Launch in 2014 the future micro-finance
facility under the PSCI which will target vulnerable groups, including persons
who have lost or are at risk of losing their job, or have difficulty in
entering or re-entering the labour market.

·
Provide, through the European Social Fund,
Technical Assistance to focus, among others, on setting up support schemes for
young business starters and social entrepreneurs.

·
Organise, in the context of the Progress
Microfinance Facility, a micro-finance and social entrepreneurship
stakeholders' forum in June 2013 with a view to engaging local financial
intermediaries in promoting entrepreneurial activity in the green economy.

·
Analyse in its 2013
Annual Report on Entrepreneurship, jointly developed with the OECD, the
situation of entrepreneurship for the unemployed. The report will present an
analysis of the current situation, offer examples of good practice in tackling
the issue and propose relevant policy recommendations.

·
Analyse results of the study on
"Self-employment and entrepreneurship: the contribution of Public
Employment Services to job creation”, and organise a dissemination event for
Public Employment Services in June 2013.

The
Member States are invited to:

·
Connect Public Employment
Services with business support services and (micro)finance providers to help
the unemployed find their way into entrepreneurship.

·
Tackle the problem of
unemployment by designing business training programmes for out-of-work
youngsters that include clearly defined stages: profiling, planning, start-up,
consolidation and growth, each stage offering a variable menu of services
(counselling, training and qualification, mentoring and access to microcredit),
in partnership with youth and other organisations, mainstream business advisers
and financial institutions.

·
Launch active labour
market programmes that provide financial support to all unemployed people for
starting a business.

·
Establish and run entrepreneurship education
schemes for the unemployed to enable them to (re-)enter business life as
entrepreneurs based on successful models from a number of Member States, in
partnership with education and training systems as an engagement route into
second chance education.

5.           Conclusions

In the current economic crisis, new and
young enterprises represent a key ingredient in creating a job-rich recovery in
 Europe. Problems linked to the low rate of company creation, high rate of
churn and low growth of companies in Europe are well known. It is time for
action to enable Europe's entrepreneurs, and Europe as a whole, to be more
adaptable, creative and to have greater impact in globalised competition that
is more demanding and more rapid than ever before.

To reinvigorate Europe's entrepreneurs and
push its entrepreneurial activity, the Commission and Member States must work simultaneously on restoring confidence, creating the best possible environment
for entrepreneurs by putting them at the heart of business policy and practice,
and revolutionising the culture of entrepreneurship.

Successful examples from all over Europe show that there are good practices that can make entrepreneurs flourish and grow. Europe must fully embrace and exploit the richness of these experiences to tear down
obstacles and abolish burdensome requirements that hamper business operations. Recognition
of entrepreneurs as creators of jobs and prosperity should be spread into
the administrations of all Member States Furthermore, Europe has to become a
welcoming place for the smartest entrepreneurial minds on an international
level: regulatory and support frameworks should entice founders from other
regions of the world to come to Europe instead of, for instance, the US or East
Asia. Only with such an attitude can far-reaching progress be achieved in the
essential areas: more proportionate and simpler regulatory requirements, access
to finance, support of new businesses, transfers of businesses and efficient
bankruptcy procedures and a fair second chance to honest failed entrepreneurs.

However, while these elements are
necessary, they will not, alone, suffice to reinvigorate European
entrepreneurship. The main motives of Europeans for starting an enterprise are
self-realisation and flexibility of time and place of work, not good framework
conditions.[82]
Therefore a radical change of the European culture towards new notions about
entrepreneurship is needed, one that publicly celebrates success, brings
the contributions of entrepreneurs to European prosperity to the fore and
showcases the rewards of an entrepreneurial career.

For all of these reasons, investment in
changing the public perception of entrepreneurs, in entrepreneurship education
and in the support of groups that are underrepresented among entrepreneurs are
indispensable if we want to create an enduring change. Only if a large number
of Europeans recognise an entrepreneurial career as a rewarding and attractive
option will entrepreneurial activity in Europe thrive in the long term.

Bringing about an entrepreneurial
revolution is a joint task of the Commission and the Member States on which they have to embark for the long term.

This Action plan and its key actions will
be followed up by the Commission through the competitiveness and industrial
policy and the Small Business Act governance mechanisms, including in their
external dimension with the candidate, potential candidate and neighbourhood
countries. The network of National SME Envoys shall, together with the EU SME
Envoy, play a particularly key role in ensuring that progress is made on the
proposed measures. Member States are invited to report on progress on the key
actions of this Communication at national level in the context of their
National Reform Programmes in the framework of the European Semester.

Annex:
Commission Key Actions

Annex: Entrepreneurship 2020 Action Plan - re-igniting the entrepreneurial spirit in Europe

Key areas || Proposals by the Commission || Date of implementation

Entrepreneurial education and training to support growth and business creation

Education and training || · Develop a pan-European entrepreneurial learning initiative bringing to gather and make available existing European and national expertise for impact analysis, knowledge,, development of methodologies and peer mentoring between practitioners from Member States. · Establishing, jointly with the OECD, a guidance framework to encourage the development of entrepreneurial schools and VET institutions. · Disseminate the entrepreneurial university guidance framework; facilitate exchange between universities interested in applying the framework; gradually promote it to the EU Higher Education Institutions; · Endorse successful mechanisms of university-driven business creation (spin-offs etc.) and university-business ecosystems supporting such creations || · 2013-15 · 2013-2014 · 2012 - 2013

Create an Environment where Entrepreneurs can Flourish and Grow

Access to finance || · Fund programmes aimed at further developing a market for microfinance in Europe, through initiatives as PSCI and and the Joint Action to Support Microfinance Institutions (JASMINE) and make resources for micro-financing available to Member States and regions via the European Social Fund or the European Regional Development Fund. · Develop an EU regime for exchanges trading in shares and bonds issued by SMEs ("SMEs growth markets") to facilitate the direct access of SMEs to the capital market in the context of the review of the Market in Financial Instruments Directive (MiFID) || · Ongoing, to be reinforced in new MFF from 2014 · Ongoing

Supporting new businesses in crucial phases of their lifecycle and help them grow || · Identify and promote Member States best practices with a view to create a more entrepreneur-friendly fiscal environment. · Revise the rules prohibiting certain misleading marketing practices to make them more robust and strengthen enforcement against such practices in cross-border cases. · Help Member States develop integrated support schemes and actions for new entrepreneurs, notably for young entrepreneurs through capacity building seminars financed by ESF technical assistance, involving inter alia relevant education and training providers to develop integrated strategies.. · || · Ongoing · 2013 · 2013 ||

Unleashing new business opportunities in the digital age || · Fostering the build-up of a knowledge base on major trends and innovative business models:in the digital sector.. · Raise awareness through a Europe-wide information campaign for SMEs on the benefits from ICT and including the creation of a European network of web businesses. · Facilitate networking via the creation of a European Mentors Network for training and advice and match-making to explore new partnerships. · Specific initiatives will be launched for Web entrepreneurs such as the creation of a Start-up Europe Partnership to unlock expertise, mentoring, technology and services, as well as of a Web Entrepreneurs Leaders Club to bring together world-class web entrepreneurs and strengthen the web entrepreneurial culture in Europe and the emergence of Massive Online Open Courses to foster web talent and the setting up of platforms for mentoring, and skill building. · Strengthen competences and skills i.e. intensify the creation and acquisition of E-skills, scientific and creative skills and managerial and entrepreneurial skills to address new markets. || · 2013-on · 2013-on · 2014 · 2013 · Ongoing ||

Transfers of businesses || · Develop guidelines on the most effective programmes and best practices to make business transfers easier, including measures for deepening and expanding the markets for enterprises, mapping available programmes in Europe and proposing necessary actions to remove remaining possible barriers to cross-border business transfers based on the work of an expert working group and a study.. || · 2013-14 ||

Second chances for honest bankrupts || · Launch a public consultation to receive views from stakeholders on the issues identified in the Communication on a new European approach to business failure and insolvency, including on giving honest bankrupts a second chance and on shortening and aligning the "time to discharge". || ·  2013 ||

Regulatory burden: clearer and simpler rules || · Propose legislation abolishing burdensome authentication requirements for public documents which SMEs have to produce to conduct cross-border business within the Internal Market. · Set up a working group to assess the specific needs of liberal profession entrepreneurs in relation to issues such as simplification, internationalization or access to finance. · Take action to ensure that more businesses get help through SOLVIT when their rights are denied in the single market by public authorities. || · 2013 · 2013 · 2013 ||

Role models and reaching out to specific groups ||

New perceptions: Entrepreneurs as role models || ·  Establish, in the framework of the "SME Week", a Europe-wide "EU Entrepreneurship Day" for students in their last year of secondary education. || · 2013 ||

Women || · Create a Europe-wide on-line mentoring, advisory, educational and business networking platform for women entrepreneurs that will bring the current national ambassadors and mentors networks on-line, deepen their offer and expand their reach at national and regional level || · 2013-15 ||

Seniors || · Help senior executives and entrepreneurs to mentor new entrepreneurs as well as support mutual and intergenerational mentoring between entrepreneurs, to exchange vital skills.. || · 2013-15 ||

Migrants || · Propose policy initiatives to attract migrant entrepreneurs and to facilitate entrepreneurship among migrants already present in the EU or arriving for reasons other than setting up business, based on good practices from Member States. · Analyse the opportunity of proposing legislation to remove legal obstacles to qualified immigrant entrepreneurs establish a business and obtain a stable residence permit. || · 2014-2017 · 2014-2017 ||

Unemployed || · Launch the future micro-finance facility under the PSCI which will target vulnerable groups, including persons who have lost or are at risk of losing their job, or have difficulty in (re)entering the labour market. · Provide, through the European Social Fund, technical assistance to focus,, on setting up support schemes for young business starters and social entrepreneurs. · Organise, connected to the Progress Microfinance Facility, a micro-finance and social entrepreneurship stakeholders' forum to engage local financial intermediaries in promoting entrepreneurship in the green economy. · Analyse insights from the study on "Self-employment and entrepreneurship: the contribution of Public Employment Services to job creation”, and organise a dissemination event to share the lessons learned with Public Employment Services. || · 2013 · March 2013 · 2013 · 2013 ||

[1]               For the job creation potential of entrepreneurship,
see the Communication from the Commission “Towards a job-rich recovery”,
18.4.2012, COM(2012) 173 final.

[2]               COM(2012) 582 final of October 2012 identified:
advanced manufacturing technologies and clean production, key enabling
technologies, bio-based products, sustainable industrial and construction
policy and raw materials, clean vehicles, smart grids.

[3]               For instance COM "Blue Growth opportunities for
marine and maritime sustainable growth" - COM(2012) 494 final.

[4]               Kauffman Foundation "Business Dynamics
Statistics Briefing: Jobs created from business start-ups in the United States" http://www.kauffman.org/uploadedFiles/BDS_Jobs_Created_011209b.pdf.

[5]               Commission calculation based on Eurostat data (2009).

[6]               The countries where preference for self-employment
grew between 2004 and 2012 were the Czech Republic (from 30% to 34%), Latvia (42% to 49%), Lithuania ( 52% to 58%) and Slovakia (30% to 33%). http://ec.europa.eu/enterprise/policies/sme/facts-figures-analysis/eurobarometer/index_en.htm.

[7]               EU Commission Flash EB No 354 " Entrepreneurship".

[8]               Albert Bravo-Biosca "The
dynamics of Europe's industrial structure and the growth of innovative
firms"JRC Conference Seville, October 2011.

[9]               Strikingly, Europe’s
corporate giants include only 12 companies born in the second half of the
twentieth century, against 51 in the US and 46 in emerging countries; of these,
only three were created after 1975 in Europe, compared with 26 in the US and 21
in emerging markets. T Philippon, N Veron, Bruegel Policy Brief 2008/1.

[10]             As evidenced in the Communication from the Commission:
"A European Initiative for the development of microcredit"
COM(2007)0708 final (adopted 20/12/2007).

[11]             'Business Dynamics: Start-ups, Business Transfers and
Bankruptcy'

http://ec.europa.eu/enterprise/policies/sme/business-environment/files/business_dynamics_final_report_en.pdf.

[12]             COM(2011)78 final (adopted 23/02/2011), Review of the
"Small Business Act" for Europe.

[13]             Idem.

[14]             Directive
2005/36/CE: "To the extent that they are
regulated, ... liberal professions, ... are, according to this Directive, those
practised on the basis of relevant professional qualifications in a personal,
responsible and professionally independent capacity by those providing
intellectual and conceptual services in the interest of the client and the
public."

[15]             COM(2011)682 final (adopted 25/102011) "Creating a
favourable climate for social enterprises, key stakeholders in the social
economy and innovation". A social enterprise is an operator in the social
economy whose main objective is to have a social impact rather than make a
profit for their owners or shareholders.

[16]             C. Jenner, 'Business and Education: Powerful Social
Innovation Partners', Stanford Social Innovation Review (Aug. 27, 2012).

[17]             The Recommendation of the European Parliament and of
the Council of 18 December 2006 on key competences for lifelong learning.

[18]             COM (2012) 669 http://ec.europa.eu/education/news/rethinking_en.htm.

[19]             See p11, Annual Growth Survey COM(2012) 750 http://ec.europa.eu/europe2020/pdf/ags2013_en.pdf.

[20]             COM(2012) 485.

[21]             VET – vocational education and training.

[22]             http://ec.europa.eu/education/news/20120425_en.htm.

[23]             Cf. Gibb A, Haskins G, Robertson I, Leading the
Entrepreneurial University, University of Oxford, 2009.

[24]             Please see recent Rethinking Education Communication
COM(2012) 669, section 2.1.

[25]             COM(2012) 485 final, 05.09.2012.

[26]             Please see recent Rethinking Education Communication
COM(2012) 669, section 2.1.

[27]             Proposal for a Council Recommendation on Establishing a
Youth Guarantee, COM(2012) 729.

[28]             COM(2011)206 final, "Single Market Act. Twelve
levers to boost growth and strengthen confidence. Working together to create
new growth".

[29]             COM(2011) 870 Final, An action plan to improve access
to finance for SMEs.

[30]             Proposal for a Regulation of the European Parliament
and of Council on European Venture Capital Funds, COM(2011)860 final; Proposal
for a Regulation of the European Parliament and of the Council on European
Social Entrepreneurship Funds, COM(2011)862 final.

[31]             Directive 2004/39/EC of the European Parliament and of
the Council of 21 April 2004 on markets in financial instruments amending
Council Directives 85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the
European Parliament and of the Council and repealing Council Directive
93/22/EEC.

[32]             Proposal for a Directive of the European Parliament and
of the Council on the access to the activity of credit institutions and
investment firms and amending Directive 2002/87/EC of the European Parliament
and of the Council on the supplementary supervision of credit institutions,
insurance undertakings and investment firms in a financial conglomerate.

[33]             Proposal for a regulation establishing a Programme for
the Competitiveness of Enterprises and small and medium-sized enterprises
(2014-2020), COM(2011) 834 final.

[34]             According to the Commission proposal for the future
Structural Funds, comprehensive strategies for inclusive start-up support must
be in place in order to obtain ESF or ERDF investments in entrepreneurship. (COM/2012/0496 final - 2011/0276 (COD).

[35]             See
the legislative proposal:

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52011PC0609:EN:NOT.

[36]             COM(2012)702 "Protecting businesses against
misleading marketing practices and ensuring effective enforcement; Review of
Directive 2006/114/EC concerning misleading and comparative advertising".

[37]             The
Concept Of Clusters And Cluster Policies And Their Role For Competitiveness And
Innovation: Main Statistical Results And Lessons Learned, Commission Staff
Working Document SEC(2008) 2637.

[38]             European Cluster Policy Group Final Recommendations,
recommendation 5, athttp://www.proinno-europe.eu/sites/default/files/newsroom/2010/09/ECPG_Final_Report_web-low1.pdf,, following up on recommendations of the European Cluster Alliance.

[39]             COM(2012) 573 final, "Single Market Act II –
Together for new growth".

[40]             Directive 2006/114/EC concerning misleading and
comparative advertising.

[41]             Including, for example, a mini
"one-stop-shop" for VAT registration, declaration and payment as in
the Commission Communication on the future of VAT (IP/11/1508).

[42]             In 2013 demand from New Entrepreneurs will exceed
available budget: as of end-December 2012 there were about 950 New
Entrepreneurs eligible for an exchange while the available budget could allow
for about 930 exchanges. Given that the pool of New Entrepreneurs eligible for
an exchange is growing on average by 25 entrepreneurs every week it is obvious
that demand will exceed supply in 2013. Already in 2012, a number of Intermediary
Organisations had used up their allocated budget and could not anymore
establish exchanges.

[43]             A Stronger European Industry for Growth and Economic
Recovery, Industrial Policy Communication Update, COM(2012)582 of 10 October
2012.

[44]             COM(2012)529 "Unleashing the Potential of Cloud
Computing in Europe".

[45]             COM(2011)942 of 11 January 2012. A coherent framework
for building trust in the Digital Single Market for e-commerce and online
services.

[46]             See
for example http://www.radicalsocialentreps.org/,
http://www.youtube.com/watch?v=iE7YRHxwoDs
and http://www.academicmatters.ca/2012/05/the-massive-open-online-professor/

[47]             http://Europeana.eu is a cultural portal, created with the support of the European
Commission, that acts as an interface to millions of books, paintings, films,
museum objects and archival records that have been digitised throughout Europe.

[48]             'Business Dynamics: Start-ups, Business Transfers and
Bankruptcy' (2011)

http://ec.europa.eu/enterprise/policies/sme/business-environment/files/business_dynamics_final_report_en.pdf.

[49]             COM(2008) 394 final. - “Think
Small First” A“Small Business
Act” for Europe.

[50]             COM(2011)
78 final Review of the “Small Business Act” for Europe.

[51]             COM(2006) 117 final.

[52]             For example, according to the 'Business Dynamics'
study, only 1/3 of Member States surveyed offered special financial products to
support transfers and in a dozen Member States little or no mentoring or
training on the subject was available.

[53]             COM/2011/864 and associated recommendation 2011/856/EU
regarding relief for double taxation of inheritances.

[54]             http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2007:0584:FIN:en:PDF.

[55]             In some Member States liquidation procedure of the
business takes approximately 1-2 years. An additional 3 to 9 years are needed
to start again business.

[56]             E. Stam, D. B. Audretsch and J. Meijaard,
"Renascent Entrepreneurship", Erasmus Research Institute of
Management, 2006.

[57]             COM(2012) 742 "A new European approach to business
failure and insolvency".

[58]             COM(2012) 744.

[59]             As requested by the Conclusions from the May 2011
Competitiveness Council.

[60]             EU Commission Flash Eurobarometer No 354
"Entrepreneurship".

[61]             The Action Programme to eliminate unnecessary
administrative burdens on businesses in the EU identified priority areas which
generated around 80% of the administrative burden from EU legislation, including
national rules implementing or transposing this legislation. In concert with
the Stoiber Group which served as an independent adviser, hundreds of
adaptations were proposed that have already generated over €40 billion in
annual savings for enterprises. Proposals involved areas ranging from
agriculture, environment, and fisheries to company law, tax, statistics, food
safety and pharmaceuticals. The biggest "contributors" to the savings
are tax law (moving from paper bills to electronic bills) and company law (exceptions
for micro-enterprises from some provisions regarding the balance sheet and
publication obligations).

[62]             COM(2011)803 and Communication on EU regulatory fitness
(REFIT!) see: http://ec.europa.eu/governance/better_regulation/index_en.htm.

[63]             Council Directive 2010/45/EU of 13 July 2010
amending Directive 2006/112/EC on the common system of value added tax as
regards the rules on invoicing.

[64]             It is estimated that if all businesses adopt
e-invoicing savings would amount to €18 billion in the medium-term.

[65]             For a compendium of best practices see extensive
annexes to 'Europe can do better', adopted by the High Level Group on reducing
administrative burdens (Nov 2011), at
http://ec.europa.eu/dgs/secretariat_general/admin_burden/best_practice_report/docs/bp_report_signature_en.pdf.

[66]             Consultation: "Which are the TOP10 most burdensome
EU legislative acts for SMEs?"
http://ec.europa.eu/enterprise/policies/sme/public-consultation-new/index_en.htm.

[67]             “Towards a job-rich recovery”, 18.4.2012, COM(2012) 173
final. See also 'Obstacles to growth - Recruiting the first employee', report
of the First Employee expert group,
.http://ec.europa.eu/enterprise/policies/sme/files/support_measures/first_emp/1st_emp_en.pdf.

[68]             This is the result of the Commission
Action Plan to improve access to finance for SMEs, (COM(2011)
870 final.

[69]             Commission Work Programme 2013 (COM (2012) 629 final).

[70]             The 'Business Dynamics' Study from 2010 found that in 7
out of 33 European countries surveyed, it was possible for five model companies
to obtain all necessary licences within 30 days.

[71]             http://ec.europa.eu/europe2020/pdf/ags2013_en.pdf, page
10.

[72]             Eurostat, 'Statistics in focus: the entrepreneurial gap
between men and women' (30/2007).

[73]             See, e.g., O. Bekh, ETF Women's Entrepreneurship
Development, Policy Brief (2012); A. Lesina, F. Lotti, 'Do Women Pay More for
Credit? Evidence from Italy', NBER Working Paper (2008); 'women in business and
decision-making', Eurochambres (2004).

[74]             O.J. L 180/1 of 15.7.2010.

[75]             A further example of what can be achieved may be seen
in the US-based Service Corps of Retired Executives (SCORE) which established a
network of 13,000 volunteers whose expert counselling helped create over 67,000
jobs in 2011.

[76]             OECD(2010), Open for Business; Migrant Entrepreneurshi
in OECD Countries, OECD Publishing, http://dx.doi.org/10.1787/9789264095830-en.

[77]             Rath, J., Eurofound (2011), Promoting ethnic entrepreneurship in
European cities, Publications Office of the European Union, Luxembourg. Europe, available at : http://www.eurofound.europa.eu/pubdocs/2011/38/en/2/EF1138EN.pdf.

[78]             COM(2011) 455 final and SEC(2011) 957 final.

[79]             Council Directive 2009/50/EC.

[80]             "Moving Youth into employment", COM (2012)
727.

[81]             See in particular the European Commission-OECD Policy
Brief on Youth Entrepreneurship in Europe,  available
at: http://ec.europa.eu/youth/news/20120504-youth-entrepreurship-employment_en.htm.

[82]             http://ec.europa.eu/enterprise/policies/sme/facts-figures-analysis/eurobarometer/