WRITTEN QUESTION E-0468/97 by Amedeo Amadeo (NI) to the Commission (19 February 1997)

Subject: Integrated programme for SMEs

With regard to the 1994 integrated programme, the Commission communication entitled 'Integrated programme for small and medium-sized enterprises (SMEs) and the craft sector - The multiannual programme, concerted actions and other Community actions in support of SMEs' (COM(96)0329) sets out some new initiatives to aid SMEs and identifies measures under other Community policies which will be implemented in line with the new priorities, specifically with a view to:

- new initiatives and concerted actions, including opening up the information society to SMEs, an entrepreneurship forum, a forum for crafts and small enterprises, and a trade forum;

- measures under other under Community policies, including 'Simpler Legislation for the Internal Market' (SLIM), the European Loan Insurance Scheme for Employment (Elise), EIF financial contributions for SMEs, introduction of the euro, resources to fund transnational investment within the EU, promotion of international cooperation, innovation in SMEs, and market-oriented technological development;

- specific measures in support of SMEs, namely the third multiannual programme, covering the period from 1997 to the year 2000.

- In addition, the Commission states that it will be submitting a communication on indirect taxation.

On the basis of the foregoing, will the Commission draw up genuine practical proposals to simplify the transnational operations of SMEs and reduce the costs entailed therein?

Answer given by Mr Papoutsis on behalf of the Commission (28 April 1997)

The Commission is aware of the difficulties for small and medium sized enterprises (SMEs) in relation to transnational activities, as pointed out by the Honourable Member, and has already proposed or is committed to proposing a number of concrete measures to simplify the transnational operations of SMEs and hence to reduce their costs in this area.

These include:

- the directive on cross-border money transfers ((Directive 97/5/EC, OJ L 43, 14.2.1997. )), which will ensure that businesses will be able to transfer money quickly, cheaply and without the risk of losing funds;

- the work programme for a common system of VAT ((COM(96) 328. )), which will propose simplification of the current VAT regime such as elimination of the distinction between domestic and intra-Community transactions and hence bring significant reductions in compliance costs, in particular for SMEs;

- promotion of appropriate legal structures for transnational co-operation, such as the European economic interest grouping (EEIG) through the REGIE (promotion of the EEIG in the European Union) initiative;

- encouraging the development of settlement procedures for transnational disputes between enterprises, such as mediation, simplified arbitration and conciliation procedures.

Furthermore, the Commission has set up a group on improving and simplifying the business environment composed of Member States and business representatives which aims at exchanging information and best practices on simplification measures and reduction of administrative costs which businesses have to face. The group has assisted the Commission in drafting a recommendation to the Member States on improving and simplifying the business environment for business start-ups which should be adopted by the Commission in the near future. Although this recommendation will mainly address the national business environment, it should also help simplify cross-border business start-ups. This recommendation will include proposals concerning the establishment of a single contact point for the registration of new businesses and alleviation of constraints of a tax, social, environmental and statistical nature. Further work will be developed within this group.

In addition, a number of actions which will have an impact on the transnational activities of SMEs are in the process of being launched under the third multiannual programme for SMEs in the context of measures for craft and small businesses.

The Commission presented a report Taxation in the European Union, Report on the development of tax systems' ((COM(96) 546 final. )) on 22 October 1996. This recommended setting up a group to provide a strategic overview of taxation policy and identified the simplification of the tax environment of SMEs and other businesses as an issue which that group could examine. This new taxation policy group has now been set up and started work on 11 March 1997. There are no plans for the time being to issue a separate communication on direct taxation.

The Commission will keep these questions under continual review and the Parliament will be informed of any developments in this area.