Areas for deregulation within the EU

Subject: Areas for deregulation within the EU

The Draghi report highlights that the EU has passed 13 000 pieces of legislation since 2019, compared to only 3 000 in the United States1. At the same time, the gap between the EU and US economies keeps growing: from 15 % in 2002 to 30 % today. The digital sector reflects a similar trend, with the EU hosting only 4 of the world’s top 50 largest technology companies2.

Given the negative impact of centralistic overregulation, Commission President Ursula von der Leyen has called for a 25 % reduction in reporting obligations for businesses and up to 35 % for small and medium-sized enterprises3.

1. Can the Commission outline, by mentioning specific legislation and examples, in which sectors it sees potential for deregulation to stimulate economic growth and innovation?

2. How does the Commission intend to ensure that deregulation efforts are effectively implemented, considering the institution’s historic tendency towards increasing rather than reducing regulation?

3. What is the estimated total cost of EU regulatory and administrative burdens on businesses and how does the Commission quantify these costs in relation to the overall economic performance of the EU?

Submitted: 15.10.2024

1 https://commission.europa.eu/document/download/ec1409c1-d4b4-4882-8bdd-

3519f86bbb92_en?filename=The%20future%20of%20European%20competitiveness_%20In- depth%20analysis%20and%20recommendations_0.pdf p. 318.

2 https://commission.europa.eu/document/download/fcbc7ada-213b-4679-83f7-

69a4c2127a25_en?filename=Address%20by%20Mario%20Draghi%20at%20the%20Presentation%20of%20t he%20report%20on%20the%20future%20of%20European%20competitiveness.pdf p. 2. 3 https://www.politico.eu/article/eu-red-tape-regulation-ursula-von-der-leyen-commission/.

Answer given by Mr Dombrovskis on behalf of the European Commission (13 January 2025)

Well-designed EU rules simplify life for citizens and businesses, especially small and medium-sized enterprises (SMEs), including in areas where they replace the patchwork of 27 national frameworks with a single set of rules.

The Commission’s aim is burden reduction and simplification without undermining its policy goals. This will ensure that doing business will be easier and faster in Europe and also facilitate innovation.

The Commission committed in 2023 to reduce reporting burdens by 25% and tabled already a first set of 41 proposals in its work programme for 2024, covering many areas (1), such as posting of workers, customs code, transport, statistics and sustainability reporting.

It also carried out a call for evidence (2), which received about 200 contributions from stakeholders highlighting areas of particular concern and rationalisation ideas.

These areas are aligned with the sectors depicted in Mr Draghi’s report as being under international competition (3). It is in these areas, where the Commission will first prioritise its efforts.

Looking forward, the President of the Commission made implementation and simplification key political priorities for the new College. Each Commissioner will hold implementation dialogues with stakeholders at least twice per year to identify simplification priorities.

Working with the Commissioner for implementation and simplification, they will stress-test the acquis and table proposals to eliminate overlaps, contradictions and be fully digitally compatible, while maintaining high standards.

1 1https://commission.europa.eu/document/download/ec1409c1-d4b4-4882-8bdd-3519f86bbb92_en?filename=The%20future%20of%20European

%20competitiveness_%20In-depth%20analysis%20and%20recommendations_0.pdf p. 318. 2 2https://commission.europa.eu/document/download/fcbc7ada-213b-4679-83f7-69a4c2127a25_en?filename=Address%20by%20Mario%20Draghi%20at %20the%20Presentation%20of%20the%20report%20on%20the%20future%20of%20European%20competitiveness.pdf p. 2. 3 3https://www.politico.eu/article/eu-red-tape-regulation-ursula-von-der-leyen-commission/. 1 ∙ ⸱ See 2024 Commission Work Programme: https://commission.europa.eu/document/download/812f6e9c-15da-4913-8fd2-aea6c26674c0_en? filename=COM_2023_638_1_annexes_EN.pdf 2 ∙ ⸱

https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/13990-Administrative-burden-rationalisation-of-reporting-requirements_en 3 ∙ ⸱ Energy, critical raw material, digitalisation and innovation technologies, high speed/capacity broadband networks, computing and AI, semi-conductors, energy-intensive industry, clean tech, automotive, defense, space, pharma, transport.






| | )This will contribute to reducing reporting obligations by at least 25% — and for SMEs by at least 35%. Moreover, each impact assessment includes estimates of all compliance costs whenever data are available. The Commission is further finalising its work on the estimation of the overall administrative burden due to EU legislation.