The European Association of Craft, Small and Medium-Sized Enterprises aisbl Rue Jacques de Lalaingstraat 4 B-1040 Bruxelles Tel +32 (0)2 230 75 99 info@ueapme.com

© 2015 UEAPME Edited by Jenny Manin

Foreword by President Gunilla Almgren

In my role as President in 2014, I represented UEAPME at high-level events throughout the year. At the Tripartite Social Summit both in March and in October, I presented the conclusions of our EU SME Barometer as a means to demonstrate that SMEs specifically suffered from low internal demand and lack of access to finance. The main UEAPME messages I delivered were that the policies implemented were not sufficient enough to enable growth and jobs and that competitiveness had to be put first in order to allow SMEs to exit this crisis situation. I also discussed the review of the Small Business Act (SBA) with DG Enterprise Director General Daniel Calleja Crespo at the SME Assembly and put forward our request for an Inter-Institutional Agreement on the SBA, in the same line as the one for Better Regulation.

Moreover, I was glad to open the conference “Competitive Enterprises - Successful Regions” jointly organised by the Committee of the Regions and UEAPME to address the question ‘how to ensure the delivery of SME related EU policies, such as the SBA, at regional and local level’. I also spoke at an OECD workshop on “Overcoming administrative hurdles for SMEs: new strategies and instruments” where I stressed that Europe needs a new legislative culture. Last but not least, I opened the session of the Third Danube Business Forum on the “Danube Strategy – Positive Experiences and Expectations” where I underlined the key role SMEs play in the Danube region’s economy.

On the awards side of my representation, I took part once again in the Sustainable Entrepreneurship Award Gala where I was honoured to hand over one of the prizes to a winning entrepreneur. Additionally, I personally supported the European Inventor of the year initiative and invited all SME associations to nominate an SME Inventor for which the award winner is to be announced in April 2015. Finally, UEAPME gave out an award at the annual ceremony of the “National Top of Private Enterprises in Romania – Top 2013” organised by our member CNIPMMR.

Furthermore, I attended the TURKONFED General Assembly in order to formally sign the membership agreement with the Turkish federation. As for the internal side of my role, I presided the UEAPME Board and General Assembly Meetings.

Last but not least, in my first year as SBS President, I presided the SBS Board and General Assembly Meetings and represented the association at several events throughout the year, ensuring the successful start of this association set up in December 2013.

Gunilla Almgren was appointed UEAPME President in November 2011 and re-elected for one year in 2014. She comes from UEAPME member association Företagarna – the Swedish Federation of Private Enterprises – and is an entrepreneur who set up a company in the sanitary fittings industry, with business contacts all over Europe.

Foreword by Secretary General Peter Faross

Following my election end of 2013, I took post as Secretary General at the beginning of 2014 and hence filled the chair that had been empty for a year. Over the course of the year, I focussed on restructuring the association and reinforcing its visibility to the outside world. Through my extensive and long lasting contacts in Brussels, I was able to actively reinforce our cooperation with several Directorate Generals and this has positively impacted our working relations. My aim was to increase and better the contacts with the European Institutions and with our members, and in doing so I have succeeded in rendering UEAPME once again the recognised voice of 12 million SMEs all over Europe.

One of our major achievements this year was our Policy Paper for the new Commission and European Parliament on the UEAPME priorities for 2015-2019. I presented this paper at the first meeting of the new SME intergroup at the European Parliament, and to all new Members of the European Commission, with the main message being that SMEs mean jobs and growth. Alongside our priorities, and through the reinforcement of our relations with Business organisations, I initiated the joint paper on Competitiveness and how this concept has to be put at the top of the list of first concerns as competitiveness is the key for jobs and growth in Europe. Finally, I managed to introduce an SME dimension into Junker’s Investment Plan so that 75 of the 315 billion € are now reserved for SME financing. This Commission proposal underlines that the European Institutions now share our point of view on the fact that “SMEs mean jobs and growth”.

As for my active participation in high-level meetings, I was very much involved in the SME envoy meetings with my good friend Daniel Calleja-Crespo as well as in the Macro Economic Dialogue and alongside President Almgren in the Tripartite Social Summit. Throughout these meetings, I put forward UEAPME’s voice on SMEs and defended our members in the different debates.

On the more internal side of my functions, I succeeded in improving our financial situation specifically regarding the non-payments situation from our members and also welcomed several new members.

Last but not least, my first year was also the one of my preliminary involvement in SBS. I participated in all the Board Meetings chaired by President Almgren, represented Crafts and SMEs in high-level meetings with the European Commission – such as the Standardisation Committee and the Annex III meetings – and was nominated as representative for the work related to the Commission’s Vademecum. My main success in my involvement in SBS was a significant increase in the budget allocated for 2015, therefore demonstrating the confidence the European Commission has in our work.

Peter Faross was appointed as UEAPME Secretary General by the General Assembly in November 2013 to take office as from January 2014. He studied law and political science and worked for the European Commission for about 30 years. From 2010 until end 2013, Mr Faross was acting Deputy Director General for "Nuclear Energy".

General Craft and SME Policy

After an intensive debate with Member Organisations, the General Assembly adopted an overall policy document with the priorities for Crafts and SMEs for the new term of the European Commission and European Parliament. In the paper “SMEs mean Jobs and Growth”, UEAPME demanded focus on SME policy as well as a more ambitious investment and growth strategy covering all policy areas so as to render doing business in Europe more attractive and enable job creation and economic growth.

UEAPME and three other Business Organisations (BUSINESSEUROPE, EuroCommerce and EUROCHAMBRES) presented their priorities to the newly nominated Juncker Commission. Their joint statement “Competitiveness First” argues that a future policy for jobs and growth has to ensure that investing in Europe becomes attractive once again and that priority has to therefore be given to competitiveness for Europe’s economy. It also states that such a policy approach has to cover all aspects impacting on and improving competitiveness within the European Union.

On the Europe 2020 Strategy review, UEAPME asked that SME policy become part of the revised Strategy and include all identified SME policy areas in order to attract investment, improve competitiveness, boost economic growth and reduce unemployment. Crafts and SMEs request structural reforms, efforts towards re-industrialisation as well as a shift of financial spending towards the real economy and an energy policy taking into account the competitiveness of SMEs. Finally, UEAPME asked for a better integration of economic governance (European Semester) and of the Europe 2020 Strategy as well as for more efforts to implement the strategy at national level.

In order to support the policy needs and demands from Crafts and SMEs in Europe, the UEAPME Study Unit publishes a survey on SMEs and SME policy in Europe. Ahead of the election of the European Parliament in May, the UEAPME Study Unit published an assessment of the Achievements for Crafts and SMEs 2010-2014. This showed that 11% of all UEAPME demands as from 2009 have been fulfilled and progress could be achieved regarding another 50%. Only in 2% of SME requests did the situation worsen during the last period of the European Commission and the Parliament.

11%

50%

38%

2%0%

20%

40%

60%

UEAPME Proposals

Overall achievements

Fulfilled

PartiallyFulfilled

Not Fulfilled

Economic and Fiscal Policy

Twice a year, the UEAPME Study Unit publishes the EU SME Barometer as a means to formulate a targeted economic policy through proper and recent information on the situation of European SMEs. This is the only relevant European source for current and forward looking data on Crafts and SMEs in Europe.

In the area of State aid regulation, the main file dealt with was the review of the General Block Exemption Regulation (GBER). SMEs will especially profit from the inclusion of support for all financial instruments into the GBER. However, UEAPME warned that the application of the GBER by Member States has to be efficiently monitored to avoid distortion of competition by providing aid not allowed by the regulation. Additionally, the review of the guidelines for State aid in the area of Research and Innovation entails that innovation aid provided to SMEs is also covered.

Access to finance is still one of the major barriers for SMEs to finance investments and recover from the crisis. Small local banks are better able to provide finance to small enterprises than large international ones. UEAPME therefore started a Local Bank Initiative with Cooperative Banks and Saving Banks in order to improve the regulatory environment for small local banks. The first results were presented at a conference with the cooperative banking sector at the European Economic and Social Committee.

After convincing the European Commission to present a regulation for caps on multilateral interchange fees for card payments, UEAPME lobbied with EuroCommerce, Hotrec and BEUC so as to avoid the watering down of the proposal by the Banking Sector. As a result, all relevant card schemes are included in the regulation and companies are allowed to refuse the acceptance of cards left out of it or to surcharge them. Moreover, UEAPME became a member of the European Retail Payment Board which aims to further develop the Single Euro Payment Area (SEPA).

After newly appointed EC President Jean-Claude Juncker announced his upcoming presentation of an investment plan to kick-start a recovery of Europe’s economy after the crisis, UEAPME presented a “Note to the President” on the most important SME demands for such a plan. All three requests – additional financial instruments, investment in energy efficiency of buildings and support structures – became part of the European Investment Plan and 75 of the € 315 billion are now reserved for SMEs.

In the area of taxation, the main file was the Commission’s proposal on a “Standard VAT Return”, as requested by UEAPME since 2003. However, the proposal does not go far enough, would once again create 28 different forms for the VAT return declaration and will not solve the language issue. UEAPME therefore lobbied to either significantly improve the proposal or for the Council to reject it.

78.7 78.6

73.269.2

55.1

59.3

64.7 65.5

72.1 70.8 70.567.5

65.3 66.167.9

71.7

78.975.8

72.771.0 72.5

75.5

51.7

60.7

56.2 55.858.5

63.7

40.0

50.0

60.0

70.0

80.0

90.0

07/H1 07/H2 08/H1 08/H2 09/H1 09/H2 10/H1 10/H2 11/H1 11/H2 12/H1 12/H2 13/H1 13/H2 14/H1 14/H2

SME Business Climate IndexCLIMATE INDEX

North

South

Enterprise Policy

UEAPME closely followed the revision of the Small Business Act and issued a position paper on the topic. According to UEAPME, the SBA principles have to be translated into an Inter-Institutional Agreement (IIA) and both the Act and the linked funding should concentrate on priority actions. The concept of entrepreneurship is important and entrepreneurs need the respect they deserve for their valuable role in society. The policy making process, and especially a quick review of the SBA, must take into account SME demands and characteristics while respect the Think Small First Principle and improve the SME test.

Additionally, UEAPME was actively engaged in the theme of Digital Agenda and in the CloudingSME Project, as project coordinator. There is a need for awareness raising and training in the area for SMEs as well as toolboxes, trust and transparency. UEAPME put forward the need for SMEs to have objective and neutral information and incentives or

subsidies for ICT training or to get external advice. In the context of this topic, UEAPME worked on awareness raising regarding cybercrime and called on the EC not to close the competition case against Google.

UEAPME adopted a position on the achievements, shortcomings and future challenges of the European Commission activities on Corporate Social Responsibility (CSR). The new CSR definition failed to take into account the reality of SMEs as well as the voluntary nature of CSR and lacked of initiatives to support capacity building for SME intermediary organisations.

Another important topic was the role of liberal professions. Indeed, they have similar problems to those encountered by SMEs – red tape, transfers of business, access to qualification and training, etc. – but have their own specificity that is not always taken into account or understood by the European Institutions. UEAPME therefore fully supported the development of a European framework definition as proposed by the EESC.

A major file UEAPME followed was the Transatlantic Trade and Investment Partnership Agreement (TTIP) negotiations and developments. In principle, UEAPME supports TTIP but the impact of the agreement on all European SMEs needs to be assessed. Additionally, more transparency and workable access to the documents are needed as well as a specific SME chapter. UEAPME emphasised the need for enhanced regulatory convergence without jeopardising the autonomy of the European Standardisation System.

UEAPME participated in the stakeholder workshops organised by the EC on the establishment of retail outlets. UEAPME is in favour of a diverse retail market landscape, and believes that – in accordance with the Services Directive – the national and regional legislations aim to guarantee this. These legislations are also a necessary tool to guarantee the viability of city centres.

Legal Affairs

UEAPME intensively worked on Better Regulation and considers that better regulation has nothing to do with deregulation. Better regulation should be a key priority for society as a whole to reduce costs for public administrations and lead to better compliance. Better regulation means that new legislation should only be introduced after good consultation and after neutral and objective Impact Assessments and an SME test while respecting the Think Small First Principle. Impact Assessments are also needed on the final compromise and not only on the original proposal from the Commission.

Furthermore, UEAPME has been active in the context of the Late Payment Information Campaign organised by the EC. The implementation and enforcement of the directive has to be closely monitored and evaluated in order to avoid possible abuse of the verification period. It is necessary to urgently start reviewing the Late Payment Directive so as to tackle the shortcomings: stricter rules for public authorities, compulsory interest, easier access to justice and compensatory measures such as the right to postpone/defer VAT and tax payments are the most urgent points to be dealt with. Furthermore, tools for enforcement of payment delays need to be introduced at national level.

UEAPME, in collaboration with HOTREC, lobbied towards the European institutions to not make the Data Protection Office (DPO) compulsory for companies, especially for SMEs whose core business is not data processing. New legislation should also avoid additional burdens to SMEs. UEAPME welcomed the new risk-based approach presented and the Council’s partial general approach that the designation of a DPO shall not be compulsory for companies except in cases where it is required by Union or Member State Law.

On the Misleading Directory Companies, UEAPME continued to lobby for a European solution. In a letter sent to EC President Barroso, UEAPME underlined that Misleading Directory Companies are a real threat for SMEs in their daily life and tasks and the number of complaints is still increasing.

Social Affairs

UEAPME further strengthened its role as EU Social Partner through the new representativeness study of the cross-industry EU social partners conducted by EUROFOUND. The results demonstrated that UEAPME through its national members affiliates the highest number of employers. Indeed, at least 52% are represented by UEAPME, whereas BUSINESSEUROPE affiliates 32% and CEEP 2%.

UEAPME successfully lobbied towards the Commission in view of the new EU’s Strategic Framework for Health and Safety at Work 2014-2020 which entails a strong focus on the needs of SMEs and micro businesses. As part of the actions undertaken, UEAPME participated in the study launched by the EC on the evaluation of all European Occupational Health and Safety Legislation, which is part of REFIT.

UEAPME welcomed and supported the Commission’s proposal to create a compulsory EU platform aimed at enhancing EU cooperation in the prevention and deterrence of undeclared work, a major source of unfair competition for labour-intensive SMEs. Moreover, UEAPME successfully called for the involvement of social partners representing Crafts and SMEs in the platform.

UEAPME along with the other European Social Partners launched a gender toolkit aiming to improve equality between women and men at the workplace, which includes many good practices from UEAPME members. They also organised a conference on Inclusive Labour Markets to take stock of the implementation progress of their autonomous Framework Agreement aiming at improving access, return, retention and development on the labour market.

UEAPME participated in the 3rd High-Level Conference on Employment organised by Prime Minister Matteo Renzi in Milan in October. It gathered the Heads of State and focussed on youth employment.

UEAPME also participated to two meetings of the Employment and Social Affairs Ministers in Athens in April under the Greek presidency on labour markets and employment protection reforms and in Milano in July under the Italian Presidency with the Environment Ministers on Green Growth and jobs.

Vocational Education and Training (VET)

UEAPME intervened at the EU conference on a possible Commission initiative for a European Area for Skills and Qualifications. While endorsing the objective to enhance the recognition of skills and qualifications, UEAPME spoke out against a new initiative and called for a better implementation of existing EU transparency instruments, including simplification and adaptation.

In September, UEAPME spoke at the final round table of the biannual EU Business Forum on Vocational Education and Training. On the business case for investing in vocational education and training, UEAPME recalled the importance of having access to the right skills for Crafts and SMEs competitiveness and highlighted their major role as apprentice trainers.

On regulated professions, UEAPME organised a fruitful exchange between its experts group and DG MARKT on the current EU screening and mapping exercise of regulated professions. UEAPME requested a stronger involvement of professional organisations and expressed remaining concerns about the justification of proportionality of national regulations required by the revised professional qualifications directive.

UEAPME became a partner of the higher Vocational Education and Training project involving several UEAPME members for the period 2014-2017. The project, coordinated by IBW (the Austrian VET Research Institute), aims to strengthen parity of esteem between higher VET and academic education.

As a follow-up of the European Alliance for Apprenticeship, UEAPME became an active partner in a European project on cost-effective apprenticeships (Dual System) alongside EU employers and VET providers for the period 2014-2016.

Sustainable Development (S.D.)

UEAPME welcomed the Green Action Plan for SMEs aiming to improve SMEs’ resource efficiency through concrete actions. UEAPME became a member of the Task Force set up by the Commission in order to monitor the implementation of the different actions.

The S. D. Committee members presented their views on the 2030 Framework on climate and energy policies and on the EU engagement in the new global climate agreement. After lengthy negotiations, UEAPME reached an important compromise to balance competitiveness of SMEs with the Green House Gases emission target, energy efficiency and support for renewables, because energy processes are not only a concern for energy intensive companies but also for SMEs.

Furthermore, the S.D. Committee adopted a position paper on the waste legislative proposal presenting SMEs concerns on the too large a responsibility for producers in waste management, on the overambitious recycling targets as well as on permits and registration requirements.

Through its involvement in the Directors’ Contact Group on the implementation of REACH, UEAPME contributed to the drafting of three documents on the participation of SMEs in the Substance Information Exchange Fora (SIEFS) as well as on the selection criteria for consultants useful for SMEs applying REACH.

UEAPME was part of the Consortium tasked to draft three practical “Guidelines for SMEs” in relation to the Biocides Product Regulation. The guides focus on the challenges SMEs face when confronted with letters of access, consortiums and data sharing.

Finally, UEAPME participated in the Joint Meeting of EU Environment and Labour Ministers in Milan in June organised by the Italian Presidency and addressed issues such as Green growth and the 2030 Framework for climate and energy policies.

Cohesion policy and territorial development

At the beginning of the year, UEAPME welcomed the adoption of the Code of conduct on Partnership. Since the beginning, UEAPME has been involved in the drafting and negotiations of these guidelines for an effective participation of SME organisations to the National Partnership Agreements and Territorial Operational Programs of the European Structural and Investment Funds (ESIFs) 2014-2020. UEAPME became member of the DG REGIO Structured Dialogue Group in charge of the set-up and follow-up of the Code, the Structural funds and the definition of the Cohesion Policy Strategy after 2020.

In November, UEAPME and CoR organised a first common seminar in order to increase the support of the EU Regions to SMEs and microenterprises at territorial level. UEAPME underlined the necessity to apply the SBA principles in the regional policies, to give the EU 2020 Strategy a territorial dimension and to increase the participation of SME organisations in defining and setting up the territorial policies and the ESIF at local level. UEAPME pledged for the “Charter for multilevel governance” to be understood as a “multilevel and multi-actors concepts for all at all levels”.

As European Social Partner and member of the European Social Fund Committee and Working Groups, UEAPME and the other EU Social Partners analysed the real application of the partnership principle of the ESIF Art.5 in Member States. The first results presented concerning the participation of SME organisations in the negotiations of ESIF at national and territorial level were mitigated and revealed a real need for technical assistance, by creating “helpdesks” at regional level. UEAPME lobbied towards the Commission for a “Friendly User Guide” to clearly explain the very high number of delegated acts and information documents made by the Commission, and to support an information process and continuous training for SME organisations and project managers.

UEAPME received two SME seats in the Rural Development Working Group and one seat in the Common Agricultural Policy (CAP) Group. These groups will contribute to the setting up of EARDF program and the definition of Rural Development Strategy post 2020. UEAPME also became member of the EU Assembly of the Rural Development Network. Due to the importance of SMEs and microenterprises for the rural development, UEAPME is negotiating a seat in the expert steering group of the network.

Sectoral Activities

The UEAPME Construction Forum, chaired by EBC, met twice in 2014 to address the most important policy developments in the field. Indeed, the Forum discussed the review of the EU waste policy, standardisation related to the construction sector (through SBS’ participation) and Commission initiatives on sustainable construction.

The UEAPME Cosmetic Forum assisted micro, small and medium sized enterprises with the registration of nano material according to the rules of the cosmetics regulation. The European Commission solicited the stakeholders for this exercise in order to assure the accuracy of the data for the publication of the catalogue of nano material. Additionally, the Forum lobbied towards the Commission on allergen labelling.

The UEAPME Food Forum met three times in 2014 to address the most important policy developments in the field. These issues ranged from the negotiations of the official controls

regulation and the fees of inspection to the implementation of the information to consumers regulation. Furthermore, UEAPME lobbied towards the European Commission, Parliament and Council for ‘no’ fees in inspection and the Forum closely followed the TTIP negotiations and its influence on European food businesses. UEAPME is also concerned for better trading practices in the food supply chain and hence engaged in a dialogue with the Supply Chain Initiative encouraging national initiatives.

The UEAPME Transport Forum presented its manifesto in the context of the European Parliament elections. It stressed the importance of the road transport sector as well as the numerous challenges it faces with issues such as cabotage, road charging and recognition of professional drivers’ training. UEAPME also published a position on trends and prospects of jobs and working conditions in the sector. On Combined Transport, UEAPME stated that the Directive has not achieved its objectives of encouraging modal shift away from road and associated reduction in road-related impacts, and asked for a harmonised application of the Directive.

Finally, the Service Level Agreements are very heterogeneous contracts specified to the needs, interests and activity level of every contract partner. In 2014, UEAPME continued with this service towards several members.

Standardisation

End of 2013, UEAPME and seven other organisations founded the international non-profit association dealing with standardisation: Small Business Standards (SBS). A Framework Partnership Agreement (FPA) was signed between SBS and the European Commission defining a long-term cooperation with the aim of promoting, defending and supporting SMEs in the European Standardisation System. UEAPME has taken an important step forward in the standardisation world through the contribution to the SBS work and activities.

Activities during the first year focused on increasing active participation of SMEs in technical committees (CEN, CENELEC and ETSI). SBS nominated 37 experts to represent SMEs in development of standards related to 11 sectors and organised seminars at both European and national levels to increase awareness of the SME role and to promote more SME-friendly standards.

Another essential element was the active contribution to European Standardisation Policy through the participation to EC meetings, with Member States, other European standardisation stakeholders (Annex III Organisations(1)) and EU Standardisation Organisations as well as through strong support to SME organisations in raising their voice and promoting their interests in the standards drafting and implementation phases.

The work delivered by the association in 2014 received positive feedback from the European Commission and SBS is therefore to receive a substantial increase in budget allocation in 2015 which goes hand-in-hand with an increase in SME experts nominated and activities covered, mainly on training and information for SMEs and SME organisations.

(1) In order to improve inclusiveness of European standardisation process, not only in case of the Commission requested standardisation, the Regulation establishes the legal basis for Union financing to European level stakeholder organisations, which represent SMEs, consumers, workers and environmental interests in European standardisation. Annex III of the Regulation sets the eligibility criteria to select and finance one organisation in each four categories (“the Annex III organisations”).

UEAPME Priorities for 2015

Economic and Fiscal Policy Committee

Investment Package of Juncker Commission

Review of the Europe 2020 Strategy

Local Bank Initiative

EU SME Barometer Enterprise Policy Committee

Review Small Business Act

Functioning of internal market of services

TTIP and TISA

Digital Single Market Package

Trade and Investment Strategy for Jobs and Growth Legal Affairs Committee

Better Regulation, REFIT, Inter-institutional agreement on better law-making

Data Protection

Late Payment Directive

Misleading Directories Social Affairs Committee

Investment Package of the Juncker’s Commission

Review of the Europe 2020 Strategy

Social Dialogue in the EU and the Euro area countries

Social dimension of Economic and Monetary Union Sustainable Development Committee

Implementation of the “Green Action Plan for SMEs”

Revision of EU waste regulation in the framework of the circular economy

REACH Regulation and registration

EU 2030 Climate and Energy Framework Training Committee

Quality worked-based learning

Higher VET and knowledge transfer

Continuous VET and cost-efficient investments in continuous training Regional and Cohesion Policy

SME Helpdesk for ESIF

Practical application of administrative simplification