Brussels – On the eve of the approval of the new ‘Small Midcap Omnibus’ legislative package, the European Union of Crafts and Small Enterprises (SMEunited) is sending a clear warning signal to the EU institutions. The message, sent this morning (20 May) to the EU Commission, is unequivocal: the creation of a new enterprise category, the so-called ‘small midcaps’ (companies with up to 750 employees), must not have any side effects on small and medium-sized enterprises (SMEs), and even less so on micro-enterprises, which are the backbone of the European business fabric.
The main concern is access to EU funds: the association fears that the introduction of small midcaps could dilute or absorb resources previously reserved for SMEs. Such a scenario, it warns, would undermine entrepreneurs’ confidence in the European support system and halt the development of millions of businesses that currently depend crucially on these programmes. The association claims that, for the current financial period and the next Multiannual Financial Framework, the protection of resources allocated to SMEs must remain an explicit priority.
With over 25 million companies in Europe, of which more than 24 million are micro-enterprises with fewer than 10 employees, this is not a marginal issue. In addition, there are around 1.3 million small businesses and just over 210,000 medium-sized enterprises, compared with only 43,000 large companies, of which only some will be affected by the new status. In this scenario, the association calls on the Commission to maintain the ‘think small first’ principle as a guiding compass for all future legislative initiatives. For the association, the challenge is therefore clear: to support the gradual growth of companies without imposing a regulatory barrier that penalises those that exceed the SME threshold. The proposal to create an intermediate category may be acceptable, provided that it serves as a tool to accompany business development with proportionate rules, avoiding that the transition from small to large enterprise involves an unsustainable regulatory leap.
The introduction of small midcaps should therefore be based on a limited number of provisions currently reserved for SMEs, applied selectively to ease the regulatory impact. According to the association, the priority must remain the adoption of policies focused on micro-enterprises, which are often oppressed by overly rigid administrative constraints and a bureaucracy that struggles to distinguish between industrial giants and small businesses with few employees.
Instead, clear objectives should be set and entrepreneurs should be given the flexibility to adapt to them according to their own capabilities, avoiding overly prescriptive legislative requirements. Ultimately, the creation of the new category must not result in a sacrifice for the most fragile companies, but represent a step towards building a realistic path to growth for all European companies. The Commission is called upon to make a strategic choice: to ensure that each step on the entrepreneurial ladder is built with care, without turning thresholds into walls.
English version by the Translation Service of Withub
