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News article20 October 2023European Innovation Council and SMEs Executive Agency1 min read

MEPs Intend That Startups Be Treated Differently From SMEs

Members of the European Parliament (MEPs) are advocating for a separate approach to handling start-up companies compared to small and medium-sized enterprises (SMEs).

Existing regulations for accessing EU support programs treat startups and SMEs alike, categorizing them based on factors like staff count and revenue. This broad categorization creates obstacles for startups in obtaining funding and expanding, as stated in a preliminary report delivered to the Parliament's industry, research, and energy (ITRE) committee on October 12th. The report urges the Commission to put forward unified definitions for start-ups and scale-ups that consider their distinctions from SMEs. It also emphasizes the need to assess how legislation, like the SME Relief Package introduced by the Commission in September, impacts start-ups.

However, when considering the comprehensive support measures for the European Union's 24 million SMEs, it's evident that start-ups received less attention. Start-ups still encounter several challenges, including restricted access to funding, regulatory complexities, talent acquisition and retention issues, and market accessibility obstacles. The introduction of the unitary patent in June, which means companies no longer have to register their innovations separately in each member state, is a positive step, but more needs to be done.



Publication date
20 October 2023
European Innovation Council and SMEs Executive Agency