Amended proposal for a COUNCIL DECISION on a Third Multiannual Programme for Small and Medium-Sized Enterprises (SMEs) in the European Union (1997-2000) - "MAXIMISING EUROPEAN SMEs'FULL POTENTIAL FOR EMPLOYMENT, GROWTH AND COMPETITIVENESS"
Date: 1996-11-14
Institutions: European Commission
Subjects: EU programme, competitiveness, employment policy, handicrafts, small and medium-sized enterprises

COMMISSION  OF THE EUROPEAN  COMMUNITIES 

Brussels,  14.11.1996 
COM(96)  591  final 

96/0087  (CNS) 

"MAXIMISING  EUROPEAN  SMEs'  FULL  POTENTIAL 
FOR EMPLOYMENT,  GROWTH AND  COMPETITIVENESS" 

Amended  proposal  for  a 

COUNCIL  DECISION 

on a Third Multiannual  Programme 

for Small and Medium-Sized  Enterprises  (SMEs) 

in the European Union (1997  - 2000) 

(presented  by  the  Commission  pursuant to  Article  189  a (2) 
of  the EC-Treaty) 

Explanatory Memorandum 

The  purpose  of  this  modified  proposal  is  to  take  account  of  the  legislative  resolution 
embodying  Parliament's  opinion1  on 
third 
Multiannual  Programme  (1997-2000). 

the  Commission's  Proposal 

for  a 

The  Commission  welcomes  Parliament's  Legislative  Resolution  on  its  Programme 
proposal  which endorses and reinforces  a number of the objectives  of the Programme. 

The  Commission  now  proposes  to  incorporate  a  number  of  the  amendments  proposed 
by Parliament  in its Resolution into a revised text of the Programme proposal. 

The  Commission  welcomes  the  majority  of  Parliament's  remaining  amendments  which 
also  support  Community  policy  for  SMEs.  In many  cases,  these  amendments  relate  to 
the  SME  dimension  of  other  Community  policies  (such  as  social  policy,  fiscal  policy, 
competition  policy,  economic  and  monetary  union  and  financial  instruments  in  favour 
of  SMEs)  rather  than to enterprise  policy.  They therefore  fit  more appropriately  in the 
context  of the  Commission's  Integrated  Programme  for  SMEs and have been  addressed 
in the  Commission's  recent  Communication2  which updates  and  develops  its  Integrated 
Programme  (1994-1996)3. 

The  remaining  small  number  of  amendments  were  not  accepted  by  the  Commission 
because  they conflicted  with the principle  of  subsidiarity  or would  not contribute  to  the 
efficient  operation  of  the  Committee  established  under  Article  4  of  the  Programme 
proposal  or  because  they  would  have  altered  the  scope  of  certain  actions  in  a  way 
which would not contribute to the objectives  of Community  enterprise policy. 

1  Legislative resolution embodying Parliament's opinion on the proposal  for a Council 

Decision on a third multiannual programme for  small and medium-sized enterprises  (SMEs) 
in the European Union (1997 -2000), COM(96)0098 - C4-0232/96 - 96/0087(CNS). 

2  COM(96) 329 final  of  10.07.1996 

3  COM(94) 207 final of 03.06.1994 

3 

proposai  fera 

çomm  rnçmm 
on a Third  Muhiarmual Programme 
for  Small and  Medium-sized  Enterprises  (SMEs) 
in the European Union (1997-2000) 

THE COUNCIL OF THE EUROPEAN UNION, 

(Text with EEA relevance) 

Having regard to the Treaty establishing the European Community, and in particular Article 
130 thereof, 

Having regard to the proposal from the Commission,1 

Having regard to the opinion of the European Parliament,2 

Having  regard to the opinion of the Economic and Social Committee,3 

Having  regard to the opinion of the Committee of the Regions,4 

1.  Whereas on  14 June  1993 the Council adopted Decision 93/379/EEC on a Multiannual 

Programme of Community measures to intensify  the priority areas and to ensure the 
continuity  and consolidation of policy for  enterprises,  in particular  small and medium-
sized enterprises,  in the Community;5 

2.  Whereas in line with  its White Paper on growth, competitiveness  and employment,  the 
Commission has adopted on 3 June  1994 a Communication on the implementation  of an 
Integrated  Programme in favour  of SMEs and the Craft  Sector;6 

3.  Whereas on 29 November  1995 the Commission adopted a Report on  "SMEs: a dynamic 
source of employment,  growth and competitiveness  in the European Union"  in which the 
Commission called for  a more ambitious Enterprise Policy to unlock the full  potential of 
European enterprises  for  employment,  growth and competitiveness7 

3a.  Whereas SMEs make a major  contribution towards entrenching the role of industry  in 
the European Union, thereby counteracting the trend towards the relocation of 
businesses; whereas the social role played by SMEs, in particular through personal 
relations with customers and staff  and through the scope for personal  development 
offered  to many businessmen and businesswomen,  and the presence of SMEs in rural 
areas should not be underestimated; 

4.  Whereas on  16 December  1995 the Madrid  European Council  invited the Commission  to 
put the objectives  of the Madrid SME Report  into practice as swiftly  as possible; 

OJ n° C  of  , p.  . 
OJ n° C  of  , p.  . 
OJ a° C  of  , p.  . 
OJ D °C  of  , p.  . 
01 a°L  161,2.7.1993, p. 68. 
COM (94)207 final of 3.6.1994. 
CSE(95> 2087. 

5.  Whereas the Integrated  Programme  in favour  of SMEs8 aims at presenting  the overall 

Community  Enterprise  Policy; 

6.  Whereas this Decision  is limited to providing  the legal and budgetary basis for  specific 

complementary  measures  which are not part  of other Community policies; 

6a.  Whereas the principle of subsidiarity  must be respected when this multiannual 

programme  is implemented;  whereas this should  not be an obstacle to assisting  SMEs 
whose activities  span borders  in overcoming  their  structural  obstacles; 

7.  Whereas  the Commission  submitted  to the European Parliament,  the Council  and the 
Economic and Social  Committee and the Committee of the Regions an external 
evaluation  report  on the implementation  of the current multiannual  programme  pursuant 
to Article 5 of Decision 93/379/EEC; 

8.  Whereas the Commission has submitted  to the Council  in the past 3 years  a series of 
communications  on measures of relevance to this  Decision  (e.g.  Report on the  future 
operation  of  the information  and co-operation  networks4 and Report  on the  Craft 
industry  and  small  enterprises10); 

9.  Whereas this Decision is especially directed at SMEs",  regardless of sector,  legal 

structure  and geographical  location,  and provides for  specific  actions  in favour  of the 
Craft  Sector,  and enterprises  in commerce and  distribution, 

10.  Whereas the measures set out in this Decision aim at: 

•  encouraging  an environment  favourable  for  the development  of SMEs throughout  the 

• 

• 

EU; 
improving  the integration  and organisation  of SMEs, especially  small enterprises  and 
crafts,  in the single market; 
improving  the competitiveness  of European SMEs and encouraging  their 
Europeanisation  and  internationalisation. 

11.  Whereas the actions  in the area of transnational  technological  development  will be 
jointly  managed  with the Community's  R&TD Programme,  respecting  the relevant 
decision-making  procedures; 

12.  Whereas the Second Programme expires on 31 December  1996, while the reasons  for  its 

adoption continue to prevail,  at least for  the foreseeable  future; 

13.  Whereas  it is therefore  necessary  to adopt a Third  Programme for  a four-year  period  and 

to endow  it with sufficient  resources to attain its objectives; 

14.  Whereas  account  has been taken of the external evaluation  report  on the  implementation 

of the current  multiannual  programme; 

14a  Whereas  the various SME organisations  have been consulted  on the multiannual 

programme  and will be consulted  again in connection with  its  implementation; 

COM (94)207 final of 3.6.1994. 
COM (95)435 final of 5.12.1995. 
COM(95)502 final of 26.10.1995. 
As  defined  in  the  Commission  Recommendation  concerning  the  definition  of  SMEs  (doc. V. 
96/261). 

15.  Whereas the Treaty does not provide, for the adoption of this Decision,  powers other 

5 

than those of Article  130. 

HAS DECIDED  AS FOLLOWS: 

Article 1 

A programme  for  a Community  Policy for  Small and Medium-sized  Enterprises  (SMEs) is 
hereby  adopted for  a period of four  years from  1  January  1997. 

Article 2 

The programme  referred  to in Article  1, incorporating  the measures specified  in Annex I 
hereto,  shall have the following  objectives: 
1.  Simplify  and improve the administrative and regulatory business  environment 

• 

• 

• 

• 

Ensure consideration of the interests of SMEs in the various Community  initiatives 
and policies 

Simplify  and improve Community  legislation 

Increase transparency  and the spread  of best practices on simplifying  and  improving 
the administrative  and  regulatory  environment 

Improve the framework  for  transnational  operations of SMEs 

2. 

Improve the financial  environment  for  enterprises 

• 

• 

• 

• 

Improve access to loan  financing 

Intensify  efforts  to reduce late payment problems 

Facilitate the development  of specific  financial  instruments 

Stimulate the development  of capital markets for  fast-growing  SMEs 

3.  Help SMEs to Européanise and internationalise their  strategies,  in particular  through 

better  information  services 

•  Develop  information  services and improve their  adaptation to the requirements of 
enterprises,  particularly  by developing  a partnership with the existing  recognised 
professional  organisations for  aid to SMEs, including those for  crafts; 

• 

Improve the promotion of SME Policy  actions 

•  Promote co-operation through business search networks 

•  Promote direct contacts through partnership  programmes 

•  Develop subcontracting  partnerships 

•  Stimulate the development  of and access to risk capital 

•  Promote access to new markets and internationalisation  of SMEs 

4.  Enhance  SME competitiveness  and improve access to research,  innovation and training 

• 

Increase the innovative potential  of SMEs 

•  Stimulate managerial  training 

• 

Improve advisory  aid to SMEs 

•  Adaptation  to environmental  requirements 

5.  Promote entrepreneurship  and support  special target  groups 

•  Business culture and  entrepreneurship 
•  Craft,  small  and micro  enterprises 

•  Enterprises  in commerce and distributive  trades 

•  Promote the inclusion of entrepreneurship  by education  institutions  in their  training 

courses 

•  Women and young  entrepreneurs;  enterprises  owned by minorities 

Policy  development  and  improvement  of knowledge about SMEs. 

In determining  the specific  measures  to implement  this programme and  in evaluating  such 
measures  the target  group shall,  where necessary,  be determined  for  each measure as a 
function  of the size of  enterprise. 

Article 3 

1. In order  to achieve the objectives  laid down in Article  1 and 2, the Commission  shall take 
the necessary  measures  in so far  as they cannot be better  achieved by the Member  States, 
taking  account  of the findings  of any specific  evaluation  reports. 

2.  The procedure  laid down  in Article 4 shall be followed  for  adopting measures relating to: 

• 

• 

the adoption,  experimental  implementation or extension of the necessary projects  devised 
for  the application  of this  Decision, 

the content  and timetable of,  and financial  assistance for,  measures and calls  for 
proposals, 

•  periodic  evaluation  of the results of each project  in accordance with the timetables  laid 

down  in specific  programmes. 

3.  The Committee  referred  to in Article 4 may examine any other matters concerning  the 

programme. 

Article 4 

1. The Commission  shall be assisted by a committee of an advisory  nature composed  of the 
representatives  of the  Member  States and chaired by  a representative  of the Commission. 

2.  The  representative  of the Commission  shall submit to the committee a draft  of the measures 
to be taken.  The Committee shall deliver  its opinion on the draft  within a time limit which 
the chairman may  lay down according to the urgency  of the matter,  if necessary  by taking a 
vote. 

3.  The opinion  shall be recorded  in the minutes;  in addition,  each Member State shall  have the 

right  to ask to have its position recorded  in the minutes. 

4.  The Commission  shall take the utmost  account  of the opinion delivered  by the committee.  It 
shall  inform  the committee of the manner  in which  its opinion has been taken  into account. 

7 
Article 5 

1. The Commission  shall submit to the Committee  referred  to in Article 4 annual  reports on 

the  implementation  of this  Decision. 

2.  The Commission  shall submit to the European Parliament,  the Council,  the Economic and 

Social  Committee and the Committee of the Regions a regular  report  on the development of 
the  inclusion  of the SME dimension  in all Community policies and programmes. 

Article 6 

The Commission  shall  submit  to the European Parliament,  the Council,  the Economic and 
Social  Committee and the Committee of the Regions, no later than the end of March  2000, an 
external  evaluation  report  on the implementation  of this Decision,  including  a cost-
effectiveness  evaluation,  and any proposals  which it deems necessary  in the light of the 
evaluations  effected. 

Article 7 

1.  This programme  shall  be opened up to the participation  of the associated  countries of 

Central  and Eastern  Europe  (CCEE)  in accordance with the conditions  laid down  in the 
additional  protocols  to the association  agreements  on participation  in Community 
programmes  to be concluded  with those countries. 

2.  This  programme  shall be opened up to the participation  of Cyprus  and Malta on the basis of 
additional  appropriations  in accordance with the same rules as those applied  to the  EFTA 
countries,  in accordance with procedures  to be agreed  on with those countries. 

Article 8 

1. This  Decision shall  enter  into force  on  1  January  1997 and shall cover  the period  up to 31 

December  2000. 

2.  The budgetary  authority  shall determine the appropriations  available for  each financial  year 

in accordance  with the principles  of good management  referred  to in Article 2 of the 
Financial  Regulation  applicable to the general budget of the European  Communities. 

Upon entry  into force  this Decision shall replace Council Decision 93/379/EEC. 

Article 9 

Done at 

, 

For the  Council 
The President 

8 
ANNEXI 

MEASURES REFERRED TO IN ARTICLE 2 

A. 

SIMPLIFY  AND IMPROVE  THE ADMINISTRATIVE  AND REGULATORY  BUSINESS  ENVIRONMENT 

A.I.  Ensure consideration of the interests of SMEs in the various Community initiatives and policies 

Integration  of  the  SME  dimension  into  the  conception  of  Community  policies.  Promotion  of  the  co 
ordination  of  Community  actions  in  favour  of  SMEs  which  enable  SMEs  to  participate  fully  in  all 
Community  actions  and  programmes,  including  the  Structural  Funds,  R&TD,  international  co-operation 
and environmental  programmes. 

A.2.  Simplify and improve Community legislation 

Actions  to  avoid  and  reduce  unnecessary  administrative  burdens  and  compliance  costs  in  Community 
legislation  which  hinder  the  creation  and  development  of  enterprises,  in  particular  SMEs,  through  the 
implementation  of  a  pragmatic  methodology  for  the  evaluation  of  the  impact  of  legislative  proposals 
(including  the use of  an improved  Business Impact Assessment  System and cost/benefit  analyses  wherever 
appropriate). 

A..?.  Increase  transparency  and  the  spread  of  best  practices  on  simplifying  and  improving  the 

administrative and regulatory environment 

Actions  to promote  the  spread  of  best practices  in particular  in the  field  of  administrative  simplification; 
promotion  of  actions on transfer  of businesses and retention of title clauses. 

A. 4.  Improve the framework for  transnational operations of SMEs 

Promotion  of the development  of alternative  dispute resolution  for  settling transnational  disputes between 
enterprises;  Stimulation of appropriate legal structures for  transnational  operations  of SMEs,  in particular 
the use of the European  Economic  Interest Grouping (REGIE project). 

B. 

IMPROVE THE  FINANCIAL ENVIRONMENT FOR  ENTERPRISES 

B. 1. Improve access to loan financing 

Promotion  of  innovative  practices  in  the  field  of  better  access  of  SMEs  to  loan  financing  (including 
mutual guarantee schemes,  Round Table of Bankers and SMEs) 

B.2.  Intensify efforts to reduce late payment problems 

Acceleration  of  follow-up  to Recommendation  on late payment  and  foresee  further  proposals;  support  lor 
actions  to  improve  the  financial  management  capabilities  of  SMEs,  in  particular  in  the  field  of 
information,  training  and the promotion of integrated cash flow  management  software. 

B.3.  Facilitate the development of specific financial instruments 

Promotion  of  the  development  of  specific  financial  instruments  of  interest  to  SMEs,  in  particular 
factoring  and credit  insurance. 

B.4.  Stimulate the development of European capital markets for fast-growing  SMEs (including EASDAQ) 

B.4a.  Analyse the specific requirements of small enterprises and crafts and the means for  meeting them. 

C.  HELP  SMEs  TO  EUROPÉANISE  AND  INTERNATIONALISE  THEIR  STRATEGIES,  IN  PARTICULAR 

THROUGH BETTER INFORMATION SERVICES 

C.I.  Development of information services (Euro-Info-Centres as  "First Stop Shops") 

Better  access  to  Community  information  for  enterprises  :  development  of  the  Euro-Info-Centre  network 
as  a  "First-stop-shop",  directing  each  request  to  the  relevant  service  provider;  improvement  of  the 
composition  of  the  network  by  applying  the  existing  evaluation  methods;  further  professionalisation  of 
the  information  task  of  the  EICs  including  proactive  information  activities,  in  particular  in  the  areas  of 
accessing  Community  programmes,  the  Internal  Market,  internationalisation,  environmental  issues  and 
the introduction  of the Single Currency;  facilitating  access of SMEs to market  information. 

9 
Maximise  the  efficient  use  of  these  networks  by  all  types  of  SMEs  by  making  use  of  synergies: 
strengthen  and  improve  partnership  between  these  information  networks  and  recognised  professional 
organisations which traditionally  have the closest contact with SMEs. 

C.2.  Improve the promotion  of SME Policy actions 

Generalised  and  decentralised  promotion  campaigns  in  co-ordination  with  EIC  network;  organisation  of 
European  Business Weeks. 

C 3.  Promote co-operation through business search networks; 

Qualitative  improvement  and  definition  of  a  quality  standard  for  the  confidential  business-partner-search 
network  (BC-Net) and non-confidential  partner-search network (BRE). 

C.4.  Promote direct contacts through partnership programmes; 

Continued  development  of  instruments  permitting  direct  contact  between  entrepreneurs  (Europartenariat 
and  Interprise  programmes) 

C.5.  Develop subcontracting partnerships; 

Further develop actions aimed at promoting  transnational  sub-contracting. 

C.6.  Promote access to new markets and internationalisation of SMEs; 

Test  innovative  approaches  in particular  by  facilitating  SMEs'  access to new  markets and encourage  their 
internationalisation. 

D.  ENHANCE  S ME  COMPETITIVENESS  AND  IMPROVE  THEIR  ACCESS  TO  RESEARCH.  INNOVATION  AND 

TRAINING 

D. I. Increase the innovative potential  of SMEs 

Identify  best  practices  and  test  concrete  approaches  through  pilot  actions,  in  particular  in  the  fields  of 
developing  firms  with  growth  potential  and  New  Technology  Based  Firms  (NTBFs).  Rapid  and  wide-
scale dissemination of the results of pilot  actions as examples of successful  business experience. 

D.2.  Stimulate managerial training 

Helping  to  identify  and  test  positive  approaches  in  the  field  of  management  training  and  consultancy 
services tailored  to SMEs (mainly  through pilot projects). 

D.3.  Adaptation to environmental requirements 

D.3a.  Improve advisory aid to SMEs 

E. 

PROMOTION  OF ENTREPRENEURSHIP AND SPECIAL TARGET GROUPS 

E.l.  Business culture and entrepreneurship 

Stimulate  the  exchange  of  best  practice  and  support  the  identification  of  particularly  dynamic 
entrepreneurs. 

E.2.  Craft, small and micro enterprises 

Launching  of  pilot-projects,  enabling  these  enterprises  in  particular  to  adapt  to  structural  changes,  to 
better  integrate  in  the  Single  Market  and  to  benefit  from  the  opportunities  offered  by  this  market, 
including  in the field  of standardisation,  certification,  environmental  and quality  management. 

E.3.  Enterprises in commerce and distributive trades 

Facilitating  the  adjustment  process  of  commercial  enterprises  to  the  Single  Market  and  to  structural 
changes,  in  particular  through  new  technologies  (COMMERCE  2000),  promotion  of  co-operation 
between  SMEs,  dissemination  of  results  of  pilot  programmes.  Follow-up  to  Green  Paper  on  Commerce 
and  Distribution. 

E.4.  Women and young entrepreneurs;  enterprises owned by minorities 

10 

Identification  of  the  specific  problems  faced  by  women  and  young  entrepreneurs,  as  well  as  small 
enterprises  owned  by  minorities  and  support  for  innovative  solutions.  Promotion  of  the  position  of 
spouses working  in the same enterprise. 

POLICY DEVELOPMENT  AND IMPROVEMENT OF KNOWLEDGE ABOUT  SMES 

Improved  statistics  on  SMEs  without  increasing  the  burden  on  enterprises;  European  Observatory  for 
SMEs;  studies;  database  concerning  SME  Policy  measures;  evaluation  of  existing  policy  actions  and 
development  of proposals for  new Community  measures in areas affecting  enterprises. 

w 

ISSN 0254-1475 

COM(96) 591  final 

s 

EN 

'"•-• 

08  to 

Catalogue number  : CB-CO-96-586-EN-C 

ISBN 92-78-11594-0 

Office for Official Publications of the European Communities 

L-2985 Luxembourg