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European Commission
SME relief package scheduled for September
European Commission (EC) intends to launch an ‘SME relief package’ on 12 September. The package aims to introduce legislative reforms to improve SMEs’ business environment and conditions in the EU.
It consists of two elements. The first is a revision to the late payments directive to ensure SMEs’ clients pay for the provided goods or services on time. The second is in taxation, the so-called Business in Europe: framework for income taxation (BEFIT) which is expected to include significant tax compliance alleviations for SMEs operating across borders.
Typical for EC timelines, the date is tentative and may change.
Commission’s sustainable finance agenda emphasises SMEs
EC published a new sustainable finance package consisting of a Communication on sustainable finance, a proposal on ESG ratings, a “recommendation” for companies and EU countries on transition finance, and delegated acts on the EU taxonomy on 13 June.
Of interest for SMEs, EC states in the Communication that it will ask EFRAG to prioritise work on “a voluntary standard for non-listed SMEs, which may use it to standardise the sustainability information they wish to report, and which can make it easier for them to participate in the transition to a sustainable economy.”
The Recommendation emphasises the need to reinforce SMEs’ access to and opportunities in transition finance. It calls on “financial intermediaries (…) to offer education and awareness programmes, advisory services or web-based tools to help SMEs that are interested in transition finance to increase their awareness of transition risks and opportunities.”
Accountancy Europe has been active in producing support tools for SMEs’ sustainable transition, including a paper on SME sustainability risk management, a 3-step sustainability checklist and more to come in the coming months.
Council
Council adopts position on alleviating listing requirements for SMEs
The Council agreed to its negotiating mandate on the listing act on 14 June. The package will make EU public capital markets more attractive for EU companies and facilitate access to capital for companies of all sizes, particularly SMEs.
This initiative is part of completing the Capital Markets Union (CMU). The proposed measures will further develop the CMU by cutting unnecessary red tape and costs for companies. This will encourage companies to get and remain listed on EU public markets. Easier access to public markets will allow companies to diversify and complement available funding sources.
Now that the Council has agreed to a mandate on the proposal, it is ready to start negotiations with the European Parliament (EP) to agree on a final version of the texts. The vote in EP’s ECON Committee is scheduled for 24 October.
Accountancy Europe has been vocal in calling, in particular, for an alleviated prospectus regime for SMEs.
EC is working on an assessment of SMEs’ participation in Horizon Europe
EC explains how the EUIPO funding to support SMEs’ IP registration works
EC outlines measures it has taken to protect SMEs against bankruptcies
IFRS Foundation publishes educational material on effects of climate matters on SMEs’ Accounting Standard
The IFRS Foundation published educational material to illustrate how the IFRS for SMEs Accounting Standard requires companies to consider climate-related matters that have a material effect on the financial statements on 16 May.
The educational material has been developed in response to feedback from some members of the SME Implementation Group and respondents to the 2022 Exposure Draft Third edition of the IFRS for SMEs Accounting Standard. This feedback identifies that interest in the potential effects of climate-related matters on SMEs’ financial statements is growing among users of those statements.
SMEs’ green trade marks on the rise
The EU’s Intellectual Property Office (EUIPO) has published its latest Green EU Trade Marks report, showing that SMEs account for 10% of environmentally friendly EU Trade Marks (EUTMs). The number of eco-friendly EUTMs has been steadily increasing since 1996, fluctuating between 10%-12% in the past decade. The report argues this demonstrates the growing commitment of SMEs towards sustainable practices and their role in introducing eco-friendly goods and services into the EU Single Market. Moreover, between 2015-2021 SMEs filed more green EUTMs than large companies.
ECB publishes survey on the access to finance of enterprises in the EU
The report presents the main results of the 28th round of the Survey on the Access to Finance of Enterprises (SAFE) in the euro area, conducted between 6 March and 14 April 2023. The survey covered the period from October 2022 to March 2023. The sample comprised 10,983 enterprises in the euro area, of which 10,085 (92%) had fewer than 250 employees.
According to the survey results, euro area firms reported a continued increase in turnover and expectations of further recovery. A net 33% reported increased turnover, with the rebound still stronger for large firms than for SMEs.
Yet, firms saw a further deterioration in profits, with a record number reporting rising labour costs. However, the net percentage of firms reporting increased in other costs fell slightly.
