Swedish SMEs: EU must reduce the regulatory burden

– There’s a real risk that the EU becomes a lazy old man sitting outside a café in Berlin or Paris, missing that train to the future, which is already departing in the US and Asia, says Anders Elfström, CEO of the production company FILT.

A new EU term also means a new European Commission takes office. The Commission, which can be likened to the EU’s central government, for the second time is being led by Ursula von der Leyen, who has already presented the guidelines for its upcoming term this summer. Following major investments in the European Green Deal, the next term will focus, among other things, on Europe’s security and competitiveness. In her so-called ‘mission letters’, von der Leyen has emphasised that most commissioners will work on ‘simplification’, a development that has been welcomed by Swedish SME business owners.

– It needs to be simple and attractive to run a business, and we need easy access to both skilled and unskilled labour, says Petter Lundgren, CEO of recruitment and staffing company Clockwork.
– Europe needs to increase immigration, to accelerate integration and to reduce taxes on labour in order to reduce staffing costs. In addition, I also think it would be positive if Sweden adopted the euro.

He believes there should be more world-class universities and research institutions within the EU. In addition, he advocates for EU enlargement, with Ukraine being the first new member.
– On the topic of the green transition, there’s a significant risk that we will be overtaken by both China and the US. I have no issues with EU regulations. Indeed, many – like the CSRD – are good, which increases transparency of our sustainability efforts.

– My greatest concern right now is the growing far-right forces in Europe, with political parties like the Alternative for Germany (AfD) in Germany and the National Rally (RN) in France.

”We’re creating trade barriers for ourselves.”

Marie Svensson, CEO of Tjeders, a company providing alarm and communications solutions to municipalities and regions, highlights the importance of strengthening the EU’s competitiveness and expresses concern over the increasing regulatory burden.
– We operate in a global market. That makes it crucial that the European Commission doesn’t overburden European businesses with a larger and more complex regulatory burden than that of the rest of the world, she says.

She stresses the importance of ensuring that SMEs can comply with the rules.
– Do they achieve their intended effect, or do they merely create ‘paper products’, with no real impact? It’s important to follow up on regulations, in order to check that they have delivered the intended impact and to ensure that they haven’t degraded the conditions for European businesses operating globally.

Recently, it was confirmed that Donald Trump will assume office as the US President on 20 January 2025. It remains unclear what effect the returning President’s trade policies will have on Europe, she notes.
– We’re currently in a situation where we’re creating trade barriers for ourselves, while at the same time Trump will be doing the same for European companies in the US.

”One in, one out.”

Anders Elfström also believes the European Commission must focus on the EU’s competitiveness and calls for investments in new technologies and services in the green transition.
– The EU works well for trade in goods between countries, but not as well for services. There are many national rules and bureaucracy that complicate matters. In addition, we need plenty of cheap, fossil-free energy to facilitate business operations, so we should quickly build more nuclear power across the EU. Even where these are national issues, coordinating on technology for economies of scale could reduce the costs.

How should the EU counter the increasing regulatory burden?
– I think ‘One in, one out’ – just like you find at a packed nightclub at midnight – would be a good motto for any new EU regulation. To introduce a new one, you first need to find an old one to remove. Put that in the EU’s constitution, because bureaucrats and politicians tend to find it much easier to simply write new ones.

Do you see any areas of concern moving forward?
– Plenty. There’s a real risk that the EU becomes a lazy old man sitting outside a café in Berlin or Paris, missing that train to the future, which is already departing in the US and Asia. The best way to catch up is to compete more effectively with better, more innovative goods and services. The answer is not regulations and laws that protect what already works.

– Of course, some things need to be protected. Given that the EU has lofty climate ambitions for businesses, companies from other parts of the world shouldn’t be able to compete in the EU without paying for the added carbon dioxide they emit.

”The regulatory burden is a big problem.”

Maud Spencer, CEO of Svalson, also stresses that the European Commission must prioritise competitiveness.
– The regulatory burden is a significant problem, because the EU has regulations that other markets don’t. It can become difficult for European companies to compete on equal terms with similar businesses in the US or Asia.

She also emphasises the importance of norms and standards within the EU, and argues that having uniform rules across the EU is vital for businesses to be able to compete on equal terms.
– It can be difficult to access EU standards, and it often requires that they be purchased. I think it would be an improvement if the EU helped develop and distribute EU standards, thus making them cheaper for companies to access.

Last spring, only 53 percent of those eligible in Sweden voted in the European Parliament elections, compared to 84 percent in the 2022 general election. Maud Spencer believes there is a significant lack of understanding of EU politics.
– The EU itself is often perceived as distant and complex. In addition, it can be challenging to understand the impact of EU decisions, since any new legislation still needs to be implemented at national level. This adds to the perception that we can only influence things at home.