‘High standards, fewer rules’ - EU businesses need red tape simplification

Cutting red tape is something businesses have asked of policymakers for years. Now, finally, perhaps, the European Commission has heard the call. As part of its simplification agenda, the Commission aims to make EU legislation more efficient and easier to implement. The plan is to reduce administrative burdens by 25% overall and 35% for SMEs.

To do this, the Commission has introduced 10 omnibus packages. However, it’s not all plain sailing. Some stakeholders warn that initiatives presented as simplification could drift into deregulation, meaning rules are weakened or removed rather than made clearer.

At the same time, a key challenge of the simplification initiatives is to ensure that EU rules are applied effectively across all Member States.

Maintaining standards

While citizens want to see results in the form of enhanced productivity and competitiveness, the question remains how the EU can ensure that simplification does not lead to a lowering of standards, while still delivering real regulatory burden reduction.

To answer that question, Valdis Dombrovskis, European Commissioner for Economy, Productivity, Implementation and Simplification, attended a Euractiv open event on 23 March to speak with stakeholders and answer audience questions.

“Europe has everything it needs to succeed in the new global economy: strong institutions and the rule of law, a highly skilled and productive workforce – and a continent-wide Single Market,” Dombrovskis said in his opening remarks. However, he acknowledged “we are not making the most of these assets to ensure our economy lives up to its full potential.”

The result? “Growth has been lower than it could be and lower than it should be. This is not a new phenomenon. Europe’s productivity challenges have been building for more than a decade. But the urgency of addressing them has increased sharply. Today, few doubt that we have reached a moment of reckoning,” he said.

“We know that the changes provided by simplification must be impactful, not merely cosmetic. They must make a tangible difference in the day-to-day operations of our businesses. That is why we are systematically engaging with stakeholders through ‘implementation dialogues’, said Dombrovskis, adding that ‘reality checks’ are needed to identify what works and what must be improved.

Sectoral dialogues

In 2025, the Commission held more than 50 implementation dialogues involving over 1,000 stakeholders across a range of sectors.

Martynas Barysas, director for internal markets at BusinessEurope, represents many of those stakeholders and he was clear: “Simplification should mean regulatory burden reduction; and this call has no roots in any external pressures, we had called for burden reduction years and years ago.”

But he added that “mere simplification is not sufficient to address the productivity gap.”

Barysas also had a message for policymakers: “Never lose the objective of simplification whenever you propose and negotiate the omnibuses or other EU initiatives, and of course, that has a lot to do with the ownership of the European Parliament and the Council as well.”

Dombrovskis said he agreed, noting, “The European Commission cannot deliver simplification alone. EU and national institutions must match ambition with delivery.”

‘More than one sinner’

Ambassador Pieter Jan Kleiweg de Zwaan, of the Permanent Representation of the Netherlands to the European Union, also took up this perspective: “I’d be the first one to say that, of course, the Commission is not the only sinner. So is the Council. Because very often the Commission comes up with proposals and then the Council adds extra layers, often under pressure from our own parliaments.”

“The European Parliament also adds extra layers,” he said, “So, there’s a responsibility for us all. But at the end of the day, we also have to be careful – simplification cannot be policy change through the back door.”

Dr. Stella Tsani, associate professor in the department of economics, at the National and Kapodistrian University of Athens, remarked: “As the Commissioner said, simplification is not simple and it should not be simple. Something that has to address at the same time many targets, economic, social, environmental, and technological, should not and cannot be simple.”

But she said, “The delivery of it in the end should be clear, easy to absorb and easy to implement. At the same time, simplification should not be just cost-cutting. It should be streamlined as an enabler of innovation and sustainable development.”

“Simplification is not just about doing less. It is about doing what matters most efficiently. This approach strengthens competitiveness while safeguarding the EU’s long-term economic, social, and environmental resilience,” Tsani concluded.

Impact assessments are pivotal

Kleiweg de Zwaan pointed out that impact assessments have a pivotal role in testing the effects of new proposals. “As impact assessments are missing too often, we want to make them simpler and more targeted. We think a lot more can be done with good non-bureaucratic impact act assessments before legislation is proposed.”

Véronique Willems, secretary-general of SMEunited, wants SMEs to be front and centre of both impact assessments and when it comes to proposing legislation: “We want to see legislation that is built on the ‘think small first’ principle. We know it’s an easy slogan, but it’s not so simple to put into practice.”

She pointed out that around 24.5 million companies in Europe have fewer than 10 employees. “So, de facto, we should be making legislation based on that group of micro companies. Then you have a completely different picture.”

“Because if we start developing legislation for that group and add layers depending on the impact and the size of companies, when it’s justified, it becomes easier to slowly get companies on board and comply with the basics. Companies can then grow at a pace that is feasible instead of asking companies to jump on top of the mountain immediately,” Willems explained.

Decide and simplify, fast

Barysas added that it is very important to deliver simplification decisions fast. “Time to market matters for companies, and companies do not yet feel the impacts of simplification. We have to acknowledge that. So, we need it faster. Additionally, it is important in our view that we ensure continuity. This should not be a one-off exercise in the simplification of EU regulations. We need a longer-term view.”

Commissioner Dombrovskis addressed the question of regulatory certainty: “Of course, we need to keep in mind that it’s a question that cuts both ways. If someone is arguing we cannot have simplification because ‘what about regulatory certainty’, the same could apply to any new requirement. The reality is we will not be able to, nor should we aim for some kind of legislative freeze. Life is developing, and the global environment in which we find ourselves is developing, so our legislative body should develop with this.”

In conclusion, he pointed out, “We must remember that simplification is not a goal in itself.”

“We must keep in mind our broader agenda of having a strong Europe in the world. A strong and competitive economy is able to strengthen our defence in the current geopolitical circumstances. So, at the end of the day, what we are doing should be uh measured against those benchmarks.”

[BM]