European Parliament legislative resolution on the proposal for a European Parliament and Council decision amending Decision 2000/819/EC on a multiannual programme for enterprise and entrepreneurship, and in particular for small and medium-sized enterprises (SMEs) (2001-2005) (COM(2003) 758 — C5-0628/2003 — 2003/0292(COD))
Date: 2004-04-22
Institutions: Committee on Industry, Research and Energy, European Parliament
Subjects: EU financial instrument, EU growth strategy, EU programme, business start-up, early-stage capital, economic growth, entrepreneurship, financial aid, investment aid, small and medium-sized enterprises

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2.3.

In implementing the Decision, the Commission may have recourse to experts and to technical
assistance organisations, the financing of which may be provided for within the overall financial
framework for the Decision. The Commission may organise seminars, colloquia or such other
meetings of experts as are likely to facilitate the implementation of the Decision, and may under-
take appropriate information, publication and dissemination actions.

Thursday 22 April 2004

P5_TA(2004)0363

Programme for enterprise and entrepreneurship ***I

European Parliament legislative resolution on the proposal for a European Parliament and Council
decision amending Decision 2000/819/EC on a multiannual programme for enterprise and entre-
(2001-2005)
preneurship, and in particular for small and medium-sized enterprises (SMEs)

(COM(2003) 758 (cid:1) C5-0628/2003 (cid:1) 2003/0292(COD))

(Codecision procedure: first reading)

The European Parliament,

(cid:1) having regard to the Commission proposal

to the European Parliament and the Council

(COM(2003) 758) (1),

(cid:1) having regard to Articles 251(2) and 157(3) of the EC Treaty, pursuant to which the Commission

submitted the proposal to Parliament (C5-0628/2003),

(cid:1) having regard to Rule 67 of its Rules of Procedure,

(cid:1) having regard to the report of the Committee on Industry, External Trade, Research and Energy and

the opinion of the Committee on Employment and Social Affairs (A5-0237/2004),

1.

Approves the Commission proposal as amended;

Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal

2.
substantially or replace it with another text;

3.

Instructs its President to forward its position to the Council and Commission.

(1) Not yet published in the OJ.

P5_TC1-COD(2003)0292

Position of the European Parliament adopted at first reading on 22 April 2004 with a view to the
adoption of European Parliament and Council Decision No …/2004/EC amending Decision 2000/
819/EC on a multiannual programme for enterprise and entrepreneurship, and in particular for
small and medium-sized enterprises (SMEs) (2001-2005)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 157(3) thereof,

Having regard to the proposal from the Commission,

Having regard to the Opinion of the European Economic and Social Committee (1),

(1) OJ C …

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After consulting the Committee of the Regions,

Acting in accordance with the procedure laid down in Article 251 of the Treaty (1),

Whereas:

(1) On 5 November 1997, the Commission adopted Decision 97/761/EC approving a support mech-

anism for the creation of transnational joint ventures for SMEs in the Community (2).

(2)

(3)

The ETF Start-up Facility, the Joint European Venture (JEV) programme and the SME Guarantee
Facility were measures provided for in Council Decision 98/347/EC of 19 May 1998 on measures
of financial assistance for innovative and job-creating small and medium-sized enterprises (SMEs) (cid:1)
the growth and employment initiative (3).

The multiannual programme set up by Decision 2000/819/EC (4), aims at improving the financial
environment for business, in particular by improving the functioning of the ETF Start-up Facility,
amending the SME Guarantee Facility and, with regard to JEV, by using, for the benefit of undertak-
ings planning to enter
the commitments effected up until
31 December 2000 under Decision 98/347/EC.

into a transnational partnership,

(4)

The purpose of the ETF Start-up Facility, JEV programme, and SME Guarantee Facility must be to
efficiently address market failures in the access for SMEs to risk capital through enhancing partici-
pation of both private and public actors, with the aim of reaching distribution rates of 100 %.

(5) According to point IV of Annex II to Decision 2000/819/EC, experience has shown that the JEV
programme needs to be simplified in order to enable SMEs’ requests for financial contributions to
be dealt with quickly by the financial intermediaries and Commission departments and to ensure that
Community resources are used correctly. It was also stated that the Commission was examining the
possibility of adapting the eligibility criteria in order to respond more effectively to the needs of
SMEs with regard to cross-border investments, including those in applicant States.

(6) On 10 October 2002 the European Parliament adopted a resolution on the Report from the Com-
mission to the
Employment
and
Initiative (cid:1) measures on financial assistance for innovative and job-creating small and medium-
sized enterprises (SMEs) (5), where it notes that the JEV programme in its current form is no longer
appropriate.

the Council on Growth and

European Parliament

(7)

(8)

The Commission’s evaluation of the Growth and Employment Initiative as at 29 May 2002 concludes
that the take-up of the JEV programme by the market is low, the job creation effect limited and the
administrative cost very high and that JEV should be phased out as soon as possible.

For reasons of cost-efficiency, the Community should withdraw progressively from programmes that
involve micro-management of small amounts of money, as is the case with the projects financed
under the JEV programme.

(9) After careful analysis, it has to be concluded that a substantial simplification of the JEV programme is
not possible, since any substantial change to the structure or eligibility criteria of the programme
would change its nature and therefore be outside the scope of the legal basis (Decision 98/347/EC).
Therefore it would not be possible to use the remaining committed budget nor would it be possible
to use the budget for projects involving the then accession countries and the candidate countries.

(1) Opinion of the European Parliament of 22 April 2004 (not yet published in the Official Journal).
(2) OJ L 310, 13.11.1997, p. 28.
(3) OJ L 155, 29.5.1998, p. 43.
(4) OJ L 333, 29.12.2000, p. 84. Decision amended by the 2003 Act of Accession.
(5) OJ C 279 E, 20.11.2003, p. 78.

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(10) The budget for the JEV programme was committed on the basis of framework agreements signed
with the financial intermediaries in the JEV network, thus creating a direct legal relationship between
the Commission and these intermediaries. Therefore a replacement of these existing framework
agreements with direct legal agreements between the Commission and SMEs, which, in this particular
programme, would have resulted in simplification and improved protection of the financial interests
of the Community, is not possible.

(11) Only relatively minor procedural changes would be possible without losing the remaining committed
budget, and these are deemed to be insufficient to ensure that the JEV programme performs signifi-
cantly better.

(12)

It is not possible to use the remaining committed budget for projects involving the then accession
countries and the candidate countries, since this budget was committed under the Growth and
Employment Initiative (1998-2000) and is therefore reserved exclusively for those states that are
members of the European Union and European Economic Area, as provided by Decision 98/347/EC.

(13) Since the phasing-out of the other two European transnational joint venture programmes (cid:1) Euro-
pean Community Investment Partners (ECIP) for the developing countries in Asia, Latin America, the
Mediterranean region and South Africa (Alamedsa countries) in 1999 and the Programme to pro-
mote SME joint ventures and other joint agreements (JOP) in the Central and Eastern European
Countries (CEECs) and New Independent States (NIS) in 2000 (cid:1) many financial intermediaries in
the JEV network have scaled down or ceased this activity because of the low volume of JEV appli-
cations from SMEs with the result that in the majority of Member States, in reality, it is no longer
possible to apply for participation in the programme.

(14)

In view of the clear conclusion of the evaluation, it is not considered appropriate to propose replac-
ing the JEV programme with a similar one.

(15) The phasing-out of the JEV programme should not affect the rights and obligations of the Commun-

ity, the financial intermediaries or the beneficiaries (SMEs) that relate to approved projects.

(16)

In observance of their legitimate expectations, the financial intermediaries should be allowed to pre-
sent applications for financial contributions for SMEs for a certain period after this Decision has been
adopted.

(17) On 23 October 2003 the European Parliament adopted a resolution on entrepreneurship in Europe,
where it calls for the establishment of systems allowing improved access, in particular for small and
micro-enterprises, to European Investment Bank/European Investment Fund funds for investments in
new technologies and investments linked to training.

(18) For the purpose of promoting innovation, research and development and entrepreneurship by SMEs,
as requested by the Barcelona Council, an environment favourable to private sector investment in
research and development, in particular through venture capital, should be encouraged.

(19) The Commission has committed itself to reforming the existing multiannual programme for enter-
prise and entrepreneurship in due time taking into account the necessity of promoting cooperation
between enterprises and business organisations and of supporting dialogue between horizontal and
sectoral or professional organisations of small and micro-enterprises and craft enterprises.

(20) The Council of 26 November 2002 stated that Member States, the Commission and financial institu-

tions should consider how to improve the financial framework for biotechnologies.

(21) The European Parliament requested, in its resolution on life sciences and biotechnologies of 21 Nov-
ember 2002 (1), that the Commission should identify how to overcome the issue of insufficient fund-
ing regarding biotech start-ups and asked the European Investment Bank to give favourable consider-
ation to follow-up actions.

(22) Decision 2000/819/EC should be amended accordingly,

(1) OJ C 25 E, 29.1.2004, p. 384.

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HAVE ADOPTED THIS DECISION:

Article 1

Decision 2000/819/EC is hereby amended as follows:

1)

Article 5(1) shall be replaced by the following:

The Commission shall submit to the European Parliament and to the Council an annual report
‘1.
on the implementation of the financial instruments of this programme for 2004 as well as a similar
end report for 2005 (the final year)’

2)

Annex I shall be amended as follows:

(a)

in the first indent of point 4(a)(i), the first sentence shall be replaced by the following:

‘(cid:1) by investing in relevant specialised venture capital funds, particularly in seed funds, smaller funds,
funds operating regionally or funds focused on specific sectors or technologies, or venture capital
funds financing R & D, e.g. funds linked to research centres and science parks which in turn
provide risk capital for SMEs.’

(b)

in point 4(a)(i) the following subparagraph shall be added:

‘The start-up phase is normally defined as up to 5 years. However, for companies in specific high
technology sectors, in particular life sciences, the start-up phase can be up to 10 years, due to the
extended pre-commercialisation product development and testing phases that are characteristic of
these particular sectors.’

(c)

in point 4(a)(iv), the following subparagraphs shall be added:

‘The Joint European Venture programme shall be phased out.

The financial intermediaries may present applications for financial contributions from SMEs to the
Commission until (*).

Applications and projects shall be dealt with according to Article 4 and Annex II of Council Decision
98/347/EC of 19 May 1998 on measures of financial assistance for innovative and job-creating small
and medium-sized enterprises (SMEs) (cid:1) the growth and employment initiative (**).
_____

(*)

115 days after the date of entry into force of Decision No …/2004/EC of the European Parliament and of the
Council amending Council Decision 2000/819/EC on a multiannual programme for enterprise and entrepre-
neurship, and in particular for small and medium-sized enterprises (SMEs) (2001-2005).

(**) OJ L 155, 29.5.1998, p. 43.’

(d)

in the first indent of point 5, the word ‘fifth’ shall be deleted;

3)

in Annex II, point IV shall be deleted.

Article 2

This Decision shall enter into force on the twentieth day following its publication in the Official Journal of
the European Union.

Article 3

This Decision is addressed to the Member States.

Done at …, on …

For the European Parliament
The President

For the Council
The President