The workshop, moderated by Marijke van Hees (ATR Chair), focused on measuring and managing the cumulative regulatory burden on business sectors and its impact on competitiveness. The European Commission’s Communication on ‘long-term competitiveness of the EU: looking beyond 2030’ motivated the workshop, emphasizing the need for a methodology to assess the cumulative impact of EU legislation.
Sessions
The first session highlighted the importance of regulatory burdens for the competitiveness of the European Union. Giacomo Fersini, Eurochambres, pointed out that EU businesses are lagging behind in global economic growth partly due to regulatory burdens, using the Green Deal and Corporate Sustainability Reporting Directive (CSRD) as examples of regulatory complexities. He called for a review of the CSRD and related laws to reduce unnecessary compliance costs and proposed an EU reduction program to minimize unnecessary regulatory burdens.
From a policy angle, Ima Gomez-Lopez, European Commission, presented the EU’s Better Regulation program and current initiatives aimed at reducing regulatory burdens and improving competitiveness in the European Union. She explained that the competitiveness check has been reinforced since March 2023, ensuring that the competitiveness consequences of a proposed Regulation or Directive are clearly described in an Impact Assessment. Since the Competitiveness Test only examines new legislation and does not focus on existing laws, the Commission is currently working on how to address the cumulative impact of EU legislation within a better framework.
The second session dealt with the methodology of Cumulative Cost Assessments (CCAs), a tool used by the European Commission to map the cumulative regulatory burden of EU legislation on a given sector. Giacomo Luchetta, Syntesia Policy & Economics, explained that CCAs provide comprehensive insights into regulatory burdens at the sectoral level, but the accuracy of these estimates depends on the degree of heterogeneity between firms within the sector. Furthermore, by relating the total regulatory costs imposed by EU legislation to the production costs in a sector, the method also provides insights in the extent to which regulatory costs impact competitiveness.
The third session provided examples of regulatory burden policies in the United Kingdom and the Netherlands. Stephen Gibson from the Regulatory Policy Committee (UK) described the UK’s regulatory burden reduction efforts since 2010, including the Business Impact Target (BIT) and regulatory sunsetting post-Brexit. He noted the challenges in offsetting new regulatory burdens with existing ones, highlighting the importance of robust Impact Assessments (IAs) and Post Implementation Reviews (PIRs).
Peter Bex from Sira Consultancy presented the Dutch SME indicator method, which quantifies and assesses cumulative regulatory costs for SMEs. Unlike the European Commission’s CCAs, this simpler method spends less effort on accounting for differences between firms within a sector, using a standard “indicator firm” for each sector. Furthermore, the SME indicator method focuses on providing policy recommendations to reduce regulatory burdens, rather than assessing to what extent the regulatory costs pose competitiveness issues for a sector like the CCA does. The SME indicator method maps all legal obligations into a matrix, evaluating the regulatory costs and workability for firms, helping policymakers identify the most problematic obligations for companies.
Conclusion
Systematic measurement and reduction of regulatory burdens are important for enhancing business competitiveness. In addition to more general insights, the workshop shed light specifically on two employed methods to measure cumulative regulatory burdens at the sectoral level. Comparing the CCA and the Dutch SME indicator method reveals advantages and disadvantages of both methods. A next step would be to develop a better understanding on whether the two methods can be used in a way that they supplement each other.