Simplifying the regulatory environment
European businesses and citizens object to the red tape in rules and regulations. Legislation sometimes entails costs and can act as a constraint to innovation, productivity and growth. This Communication aims to rectify these shortcomings and establishes the new European strategy for the simplification of the regulatory environment.
Communication of the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 25 October 2005 "Implementing the Community Lisbon programme: A strategy for the simplification of the regulatory environment" [COM(2005) 535 final -- Not published in the Official Journal].
In order to implement the Lisbon Strategy, simplification of the regulatory environment is one of the European Union's priorities. The idea is to produce legislation which does not go beyond what is necessary to achieve the objective. Certain provisions are excessively prescriptive and too costly. Others are inconsistent, unclear or obsolete. Europe's small and medium-sized businesses suffer disproportionately from legislative and administrative burdens and deserve special attention. The regulatory framework must be simpler and more effective. The Commission underlines the fact that simplification is not synonymous with deregulation, but aims to help citizens and economic operators find their way through the regulatory environment.
This Communication follows that of March 2005 on better regulation for growth and jobs.
A new simplification strategy at European Union level
In order to implement its strategy the Commission has established a rolling programme of simplification, which specifies the pieces of legislation it intends to simplify over the next three years. The Commission, through consultation via the internet, takes account of the opinions of the Member States, the business community and the public. The simplification programme relates to certain key areas for business competitiveness, such as company law, financial services, transport, consumer protection and waste. It will be systematically reviewed and updated. The Commission also plans to include major legislative simplification initiatives in its annual legislative work programmes. A series of additional communications will cover agriculture, the environment, health and safety at work, fisheries, taxation, customs, statistics and labour law. The rolling programme includes comprehensive simplification initiatives, sector-specific rules and horizontal rules, depending on the field.
The Commission is basing its approach to simplification on sectoral assessment. It intends to measure the impact of general and sector-specific legislation, especially the economic, environmental and social aspects, on all stakeholders in each sector concerned. Assessment will consist of an analysis of the administrative and other benefits and costs of the legislation in question. Initially, the focus will be on three sectors: automotive, construction and waste. The Commission will gradually extend its approach to other industry sectors such as pharmaceuticals, mechanical engineering, information and communication technologies, and energy-intensive sectors. Finally, it will focus on services, which account for more than 70% of EU GDP, in order to improve their competitiveness.
The Commission's approach to simplification
The Commission intends to make use of several simplification methods, including:
- repeal: the Commission will continue its efforts to repeal legal acts which are irrelevant or obsolete. Member States will also have to repeal the national measures corresponding to Community acts that have been repealed. The Commission is planning to introduce review clauses and even "sunset clauses" into its legislative proposals;
- codification: the Commission intends to complete codification, which contributes to the transparency and implementation of legislation, by 2007;
- recasting: recasting simultaneously amends and codifies the legal acts in question and thus helps to provide economic operators with a clearer and more streamlined regulatory framework. The Commission is planning to use this method when proposing amendments to existing acts, especially for the most effective amendments in terms of simplification;
- modification of the regulatory approach: first of all, the Commission intends to limit the use of legislation by drawing on methods such as co-regulation and the definition of essential requirements in connection with harmonisation. Standardisation is an example of co-regulation which the Commission is actively encouraging. As regards technical harmonisation, the Commission's aim to limit the content of Community legislation to essential requirements, referring to harmonised European standards for all the detailed technical specifications. The Commission envisages simple and light conformity assessment. These methods will reduce intervention by public authorities. The Commission would like to extend this approach to as many sectors as possible, even beyond the services sector. The change in the regulatory approach also involves choosing the appropriate legal instrument more carefully. In some cases replacing directives by regulations can be conducive to simplification, as regulations avoid implementation differences at national level;
- reinforcing of the use of information technology: e-government can help reduce administrative burdens and will be promoted by the Commission.
Support from the institutions and the Member States
Simplification necessitates not only a shared method, but also a shared mindset. All institutions and all Member States are invited to make contributions to simplify the regulatory environment. For its part, the Commission will design proposals for simplification based on ex post evaluations, consultations and careful assessment of the various options. It will set up internal rules for monitoring progress. The European Parliament and the Council must also promote simplification, in particular by fully implementing the 2003 inter-institutional agreement on better law-making and by adopting a common approach to impact assessment before the end of 2005. Finally, the Member States must match the initiatives taken at EU level by equally ambitious national programmes.
The Commission is determined to succeed with this simplification strategy. In order to do so it will regularly update its programme, taking account of the opinions of the stakeholders concerned.
This fact sheet is not legally binding on the European Commission, it does not claim to be exhaustive and does not represent an official interpretation of the text of the Treaty.