Between 2008 and 2010, the European Commission and EU Member States have implemented actions set out in Europe's Small Business Act (SBA) to alleviate administrative burden, facilitate SMEs’ access to finance and support their access to new markets. Although most initiatives foreseen by the SBA have been initiated, a review of implementation so far reveals that more must be done to help SMEs.

In the EU, some 23 million small and medium sized enterprises (SME) employ 67% of the private sector workforce. This figures show at what point, both the Europe 2020 strategy for growth and jobs and the European economy as a whole, depend on their performance. In order to help these companies to overcome the economic crisis, the European Commission presented in June 2008 the Small Business Act, the first comprehensive SME policy framework for the EU and its Member States. Since its adoption considerable progress has been made through actions to strengthen SMEs in a number of areas:

• 100.000 SMEs have benefited from the financial instruments of the Competitiveness and Innovation Framework Programme, creating more than 100 000 jobs.
• Through the late payment directive public authorities are now required to pay their suppliers within 30 days, improving the cash flow of businesses.
• In most EU Member States the time and cost of setting up a company has been considerably reduced, lowering the EU average for a private limited company from 12 days and €485 in 2007 to 7 days and €399 in 2010.
• Streamlined online procedures and opportunities for joint bidding have made participation in public procurement easier for SMEs.
• The new EU SME Centre in China helps SMEs accessing the Chinese markets.

Although all Member States have acknowledged the importance of a rapid implementation of the SBA, the approach taken and the results achieved vary considerably between Member States. The February 2011 SBA review underlines that Member States have to step up their efforts to promote entrepreneurship and SMEs to support entrepreneurship in today’s difficult economic climate.

Giving fresh impetus to the SBA

The Commission is determined to continue to give priority to SMEs. To reflect the latest economic developments, align the SBA with the priorities of the Europe 2020 strategy and continuously improve the business environment for SMEs, the review proposes further action in a number of priority areas:

• Improved access to finance to invest and grow
• Smart regulation to enable SMEs to concentrate on core business
• Making full use of the Single Market
• Helping SMEs face the challenges of globalisation and climate change