Germany and France make joint call for less red tape at European level

The German and French Governments are calling for more modern administration at European level – with simpler, more comprehensible legislation.

Federal Minister for Economic Affairs and Climate Protection Dr Robert Habeck:
“Today, we are sending out an important signal for a reduction of red tape for our companies and for a stronger European economy. Germany and France are jointly advocating to the European Commission for a package of measures which will simplify EU rules and make them more efficient, especially for small and medium-sized enterprises. The reduction of superfluous bureaucracy at European and also at national level is an important building block to accelerate approval procedures, to facilitate investments and to allow for greater scope for innovation and creativity without abandoning necessary standards of protection.”

Federal Minister of Justice Dr Marco Buschmann:
“France and Germany have adopted a joint initiative to reduce bureaucracy today. The aim is to cut the costs of compliance with EU rules. In a globalised world, national efforts to prune bureaucracy are not enough on their own. More than half of our compliance costs now stem from the European Union. We are therefore progressing this issue together with France. As already happens in Germany, we want to know what the compliance costs are at EU level. But we are not just analysing the problem: we are also focusing on solutions – to deliver clear relief for our companies. For example, we propose broadening the European definition of small and medium-sized enterprises (SMEs). We want to reduce reporting requirements. This will boost our economy and Europe’s position in the world. Working together, Germany and France can generate an impressive amount of influence. We want to use this to thin out red tape – to keep Europe competitive.”

In this initiative, both countries call on the European Commission to develop a plan of measures for more relief from bureaucracy. This should make a swift contribution towards relieving the burden on commerce and administration, and strengthen the competitiveness of the EU in the long term.

Through their joint initiative, Germany and France want to simplify the bureaucratic rules at EU level and to make them more efficient. This should accelerate planning and transition processes that are needed for the economy and the mitigation of climate change, facilitate necessary investments in forward-looking technologies, and unleash creative forces in business, civil society and administration without abandoning necessary standards of protection. In particular, digitisation should be progressed further, and greater consideration should be given to it in the lawmaking process.

Both governments propose a stocktaking of all compliance costs at EU level. Similar to the German model, a bureaucracy cost index could be set up to show the development of costs over time. In addition, reporting requirements are to be reduced to a necessary minimum and, in particular, duplicate reporting requirements are to be abolished. The proposals that the European Commission has said it will make to reduce reporting requirements anchored in European law is an important step towards this.

The Franco-German initiative focuses in particular on small and medium-sized enterprises. A set of measures is to reduce the bureaucratic burden for them.

Specifically, the initiative envisages the following proposals:

Bureaucratic burdens on companies are to be reduced:

• A set of measures is to be launched to bring relief to SMEs in particular. For example, the European definition of small and medium-sized enterprises (SMEs) is to be expanded to include an additional company category of “small mid-caps” (250-500 employees), and a further review of the financial thresholds of the SME definition is to be carried out.
• In addition, reporting requirements are to be reduced to a necessary minimum and, in particular, duplicate reporting requirements are to be abolished.
• The General Data Protection Regulation (GDPR) is to be revised to achieve greater legal certainty and more effective enforcement. Also, consideration is to be given to further relief for SMEs, non-profit organisations and the voluntary sector from obligations to provide information, documentation and proof of compliance.

Legislation is to become simpler and easier to understand:

• Existing instruments of Better Regulation are to be applied more consistently in the future. Here, it is particularly important to conduct impact assessments.
• New EU legislation should be consistently subjected to effective digital checks in order to improve the quality of legislation at EU level. This should prevent bureaucratic burdens being imposed that subsequently have to be scaled back.
• The paper also suggests taking stock of the costs of bureaucracy at EU level. Similar to the German model, a bureaucracy cost index could be set up to show the development of costs over time.

The economic transition is to be supported:

• Planning and approval procedures are to be accelerated.
• Going forward, legislative initiatives in various policy fields are not to be viewed in isolation, but in the context of their interaction with other regulations, and are to be coordinated with a view to their overall impact.

The Franco-German initiative to cut bureaucracy at the European level is to be transmitted to the European Commission in the next few days.