By Huw Jones
JOUY-EN-JOSAS, France, July 18 (Reuters) - European Union
industry ministers aim to adopt by December a raft of measures
making it easier for smaller firms to create jobs, the bloc's
president France said on Friday.
EU industry ministers discussed the Small Business Act, a
package put forward by the European Commission aiming to cut red
tape in a sector that accounts for 99 percent of all businesses
in the 27-nation bloc.
The centrepiece is a law (SPE) that small firms can use to
operate across the EU and avoid a 27-state legal labyrinth.
"We reached agreement in principle on the SPE today," Herve
Novelli, France's minister of state for commerce, told a news
conference. "We aim to reach a political agreement at our
meeting in December."
The EU executive estimates that the potential savings on
legal costs for setting up a business could be between 2,000 and
10,000 euros and between 750 and 8,000 euros for day-to-day
costs.
Parts of the SPE may prove tricky to adopt as the executive
proposes to allow an SPE to be set up for just one euro in legal
capital, saying this would result in cost savings of up to
35,000 euros in some member states.
More controversially, a company can register in one EU state
and operate completely in another state.
EU Internal Market Commissioner Charlie McCreevy welcomed
Friday's broad agreement but expected some "difficult" talks
ahead on adopting the details.
The European Parliament has joint say on the proposal.
Ministers also backed the Commission's proposed code of
conduct to make it easier for smaller firms to participate in
public procurement tenders outside as well as inside the EU.
France wants the code to go further and has spoken of quotas
for smaller firms as in the United States.
"Certain member states today expressed their reticence on
this," Novelli said. "I think the Commission proposal is a good
starting point. We have to have agreement involving all member
states."
EU Industry Commissioner, Guenter Verheugen said there was
no need to introduce binding quotas.
Also part of the package is a proposal to allow EU states to
introduce reduced rates of value added tax on a range of
locally-supplied labour intensive services.
Currently there is a patchwork of reduced rates across the
EU that expire in 2010 and must be renewed to avoid hikes in
common services from haircuts to bike repairs.
Novelli said Germany again voiced its reluctance on the tax
proposal which needs unanimity among EU states to be adopted.
UEAPME, the small business lobby, told ministers that the
"think small first" principle proposed in the package should be
made legally binding to avoid it being skirted.
"Our trust in the European Union largely depends on its
capacity to deliver on the Small Business Act," the lobby's
secretary general Andrea Benassi said.
Verheugen and McCreevy cautioned about trying to stop the
tide of globalisation with protectionist measures.
"You just can't turn the clock back," McCreevy said.
(Editing by David Cowell)
