Archived policy papers
CEEP Opinion on the Next Generation EU recovery instrument – PDF
- Next Generation EU aims to mobilise €500bln in grants and €250bln in loans to Member States without involving the mutualisation of pre-existing debts. CEEP very much supports this proposal including its innovative character and its close interlink with the MFF 2021-2027.
- The crisis has drastically exposed the result of years of underinvestment in social and physical infrastructures in some Member States. CEEP consequently calls for a precise and consistent emphasis on public services and services of general interest, as the current proposals fail to sufficiently emphasize the role of SGIs, which are the pillar underpinning the economic and social infrastructure of the EU.
- The lack of an appropriate framework supporting those essential services will seriously jeopardise our economy’s overall capacity to recover as well as to overcome our long-term challenges: Next Generation EU gives EU and national institutions the chance to demonstrate that investment in physical and social infrastructures cannot be considered as a cost, but rather as the indispensable precondition to ensure long term competitiveness, employment and growth.
- EU social partners represent a unique bridge capable of connecting stakeholders and allowing the consolidation of efficient and coordinated actions that bring together the EU, national, sectorial and company levels. Joint actions to foster social partners at national level must be a priority for a socially inclusive recovery: their active participation, also at regional and local levels, will be especially crucial when it comes to the design of national recovery plans.
- EU leaders must remain aware of the evolving nature of the recovery instrument and be ready for eventual adaptations to the original proposal, embodied in the Next Generation EU. This can be achieved by Member States continuously showing flexibility and commitment to the core principles of unity and solidarity.
- Special attention must be given to enhancing top-down and bottom-up articulations between levels of governance and across key stakeholders. The scale and scope of the recovery should not jeopardise the active participation of local and regional authorities, which are crucial for an efficient policy design and implementation.
- It is crucial to mobilise the necessary funds to foster strategic investment and industrial ecosystems to better respond to future shocks. Other challenges, such as revising the current European framework of taxation and generating additional EU own resources, will follow with Member States still very far from an agreement. Against this challenging background, the idea of relying on uncertain income sources as proposed by the European Commission does not seems to be a pragmatic solution in the short term.
During the meeting of the General Assembly on 27 June 2019, CEEP members have adopted an opinion “A Sustainable Climate Strategy for Europe: Acting Now! – Statement on Climate “For Sibiu and Beyond”“.
Our key messages are the following:
- Global warming is a major risk and climate policies must be developed as part of a sustainable approach.
- A prerequisite for success is the social acceptability of these policies, which requires greater equity and democracy, particularly at the local level.
- CEEP members manage essential infrastructure and provide SGIs that contribute to well-being and competitiveness; their proximity to economic actors makes them key players in climate policies.
- The EU Strategic Agenda 2019-2024 needs to recognise that role and put “enablers” of sustainable climate policies at its centre.
On 8 May, ahead of the Sibiu Summit, CEEP presented its contribution to the EU Strategic Agenda 2019-2024, to be adopted during the June Council meeting. Our input, prepared on the basis of the CEEP Key Priorities 2019-2024, relies on 4 pillars:
- A Europe of values and freedoms,
- A fair digital transformation,
- A sustainable and inclusive climate strategy,
- A Europe which leads by example.
You can find our contribution here.
CEEP Contribution to the Upcoming White Paper on the Future of the EU – PDF Version available here
WHERE DOES THE EUROPEAN PROJECT STAND?
Nowadays, the future is happening faster than ever, bringing new opportunities and challenging the established technological, economic, social and political models and patterns. The Revolution 4.0, the Digital Union, the Energy Union, Circular Economy are reshaping our lives daily, pressing the policy makers to redesign and implement new rules.
At the same time, it is not exaggerated to state that the European Union is currently undergoing one of its most critical and existence-threatening phases since the signature of the Treaties of Rome on March 25, 1957. International terrorism, protection of the EU’s external borders, distribution of refugees, tough negotiations on international trade agreements, the Brexit referendum, the EU sanctions against Russia and the ongoing economic and financial crises are just some of the most controversial topics member states of the European Union are struggling to find a common solution to.
In this situation, both EU members states as well as their citizens are questioning the added value of the EU, at a time when staying united is more necessary than ever. Also, European citizens are openly questioning whether the EU is still able to find solutions to the most urgent challenges and to secure solidarity, protection, stability, national traditions and social cohesion. Thus, on top of the above-mentioned crises, the EU is also suffering from a legitimation crises.
This has been the case since at least five years. We remember: In 2012 the European Union celebrated the 20th anniversary of the European Single Market. Back in May 2010, former EU Commissioner for Internal Market and Competition, Mario Monti, presented his so called „Monti Report“ on the state of play of the Single Market. Already in this report Monti declared that the Internal Market was more unpopular than ever amongst the European Society. Already at that time people feared that the Internal Market was undermining their well-established social systems, national traditions and services of general interest.
Thus, we must cope with a feeling that has been growing since almost ten years now. It is foolhardy to think that the EU can solve this problem at a moment’s notice. Together we must think about a joint strategy to come out of this crisis even stronger then we went in.
WHAT CAN WE DO TOGETHER?
CEEP, the EU association representing employers and enterprises providing public services and services of general interest (SGIs) was established in 1961. Since then CEEP has been accompanying European policies in close cooperation with the European Council, the Council of the European Union, the European Parliament and the European Commission. Today, CEEP members employ 30 percent of the EU workforce, contributing by one third to the European GDP and representing 500.000 enterprises, amongst which 25.000 local public services and SGIs enterprises.
As social partner, we very well know that the economic and financial crises revealed significant room for improvement when it comes to the performance of public administrations and SGIs’ enterprises. Being close to the citizens and to the enterprises, we also very closely monitor the discussions about international trade agreements, and are aware of the fears of the citizens. Moreover, we openly admit that CEEP and its members might also be partially responsible for questioning the added value of the Internal Market by heavily criticising former attempts of the European Commission to liberalise different kinds of public services.
We do however acknowledge that the Treaty of Lisbon formed a sound basis for the provision of Services of General (Economic) Interest and for the protection of national traditions and identities. We appreciate that, at the latest since the Juncker-Commission, offenses against public services and SGIs have diminished. That is why we totally support the political strategy of the Juncker-Commission “to be big on big things and small and modest on smaller things”. We welcome the holistic approach of the European Union when dealing with those big things namely the Energy Union of the Digital Union, for example. This is already an important lesson learned which the EU can build upon in the next decade.
CEEP is convinced that the current EU crises can only be solved by a strategy that is based on a strong combination of EU and decentral actions. The problems cannot be solved in Brussels, Strasbourg or Luxembourg or by the EU Institutions alone. We need the commitment of the EU member states, national politicians, national social partners, and of the national media. We need to jointly communicate on the valuable things done by the EU, on the real added value it brings. We need to step down from an attitude where the EU is made responsible for everything that does not work or that goes wrong and national politics or associations are responsible for all good outcomes. We need to commit ourselves to a differentiated argumentation.
Employers and enterprises providing public services and SGIs can also do more. First, in their role as social partners. Our members can make and are willing to make a greater contribution, together with their Trade Union counterparts at national, regional and local level, to bring and maintain social peace, create new jobs, reduce levels of poverty. Sustainable results can be achieved through negotiating strong collective agreements as well as by contributing to shaping and implementing ongoing structural reforms. This will mean that national social partners will take ownership of reforms and increase their acceptance by citizens.
But we also have a role in acting as mediators between the EU and our members. When it comes to international trade agreements, for example, we have successfully convinced most our members that in case some red lines are guaranteed, international trade agreements are valuable and necessary assets for making the EU a strong economic player vis-à-vis third countries.
In the same way, we are constantly communicating to our members, and the citizens they serve, about the importance for the EU to keep a leading role in climate and sustainability policies. EU’s unique possibility to handle these questions and combine them with cohesion policies, at a general level, should be further promoted. It is about issues/questions where EU initiatives play a major role, in relation to each member state’s action. In this framework, we are committed to doing our share, especially through the, CEEP-CSR-label that encourages public services and SGIs’ providers into sustainable and socially responsible practices in all aspects of the services’ delivery (towards the environment, the citizens, the workers, the stakeholders).
Moreover, CEEP members want a strong European Union when it comes to the relationship with third countries. It is only together with all EU member states that we can protect our values and identities. The EU only counts for 500 million citizens compared to 7.35 billion worldwide, growing to some ten billion by the year 2050. However, as stated above we – meaning EU and national social partners, EU and national policy makers, EU and national media and civil society – can improve the way we communicate these economic and social rationalities.
CEEP is fully ready to further act as an intermediator/ translator between the EU and its citizens. It is not only a scientific finding of CEEP members that people tend to trust their national, regional and local public services and SGIs the most. This was also for example revealed by a Eurobarometer Report of February 2009 concerning “The role and the impact of local authorities on the European Union”. People tend to have more trust in the local level due to its proximity to the people. We can build upon this to positively communicate about the EU and bring back hope, a feeling of protection and perspectives, finally regaining trust in the ability of politics to meet the above-mentioned challenges.
OUR CONCRETE PROPOSALS
As stated above CEEP is convinced that it is necessary to identify actions for implementation at EU member state level.
Decisive measures are necessary to reinforce Europe’s competitiveness in order to support higher levels of productivity, employment and prosperity. The EU is suffering today from a low comparative productivity and misallocation of investment, alongside many structural weaknesses. This explains why the global crisis hit Europe so hard, and why EU-wide recovery still presents such a challenge.
The effects of the crisis have exacerbated structural weaknesses and contributed to a legacy of economic and policy challenges that now need to be addressed.
Today, deeper European market integration, further cohesion and convergence, strengthening and developing markets and stepping up efforts to make Europe stronger and more competitive are crucially needed. To make Europe more competitive and productive, CEEP’s members will modernise their services delivery by adapting to the digitalisation and adopting new technologies, by promoting innovative economic models and particularly the circular economy and by contributing to modernising education systems to the new labour market challenges.
The EU manufacturing industry is lagging behind its world competitors – both in terms of innovations’ generation and in terms of marketing the innovative products. CEEP can help remedy this by contributing to the digitalization of public services and SGIs and to the circular economy, by modernizing health and social care (digitalization, new technologies, improved life expectancy), by intervening in education improvement, etc., including the energy, transportation and other elements, that can increase the EU competitiveness.
The lack of skilled labour force in the EU is not expected to improve in the future. Therefore, it is important to stress once more the potential of public services and SGIs in attracting people, especially the young, to public services and SGIs’ jobs. Public services and SGIs’ employers have to reskill and upskill their workforce as new demands constantly emerge in the labour market and new forms of jobs continue to develop. Transitions between education and jobs and from one job to another will be increasingly important. In that respect investments in human capital will play a major role and digital skills will be crucial to be able to adapt to the changing demands on the labour market. The digital transformation has been producing fundamental changes to the EU labour market, both in quantitative and qualitative terms. It is critical to stay on the front line and at the same time ensure the fairness of the transformation.
There is a striking need for the EU social and economic model to be strengthened in these turbulent times as illustrated by the every-day strikes and demonstrations all over Europe. The public services and SGIs have a lot to offer in this regard, because of their important potential to improve the living standards and to boost regional development. Many regions in Europe have fallen behind and are now failing to attract investment and economic activity, due to a lack of public services and SGIs’ infrastructures, skills and connectivity, this ends up creating a spiral of diminishing potential at national, regional and local level. To break this vicious cycle: we need to foster European regions’ attractiveness, by supporting their ability to develop quality public services and SGIs such as health, security, education, innovation. A renewed priority for inclusion and productivity is therefore key to improving living standards and supporting regional developments.
Furthermore, the projects that originate from the European Fund for Strategic Investments (EFSI) could also be used to better emphasize the added value of the EU. Billions of Euros are mobilized in order to invest in critical infrastructure, education, research and innovation but it is too seldom spoken about. We did of course take notice of the roadshow of Commissioner Jyrki Katainen on the EFSI in 2015, however, as stated above, the EU-Institutions cannot be everywhere. Banks and local politicians could be mobilized to become more active in reporting about these important projects vis-á-vis their citizens/ customers. Here the target group should be the younger/ middle-aged generation of politicians and entrepreneurs. They mainly grew up with an integrated, peaceful and prosperous Europe. It is the generation that benefited the most from the EU although seldom speaks about its successes. Many EU achievements are taken for granted nowadays by a huge majority of people. In CEEP’s point of view we need to make clear that nothing can be taken for granted if all stakeholders are not get engaged in securing these achievements.
On top of fostering the use of EFSI 2.0 through the completion of its third pillar, the White Paper should also be the opportunity to re-think some EU rules, both in the context of completing the EMU and of reviewing existing fiscal rules, including the Stability and Growth Pact. A non-dogmatic approach and open analysis of those rules is what citizens ask for as opposed to the defence of the status quo at any price. Indeed, we have several recent examples, the Brexit vote and the recent Presidential Election in the US being the most significant ones, demonstrating to at least some extent, a growing “anti-establishment” belief/movement. If the reflection on the Future of Europe does not recognise and respond to this then we (European and national institutions, European and national social partners) could be accused of simply trying to protect the “status quo” and blame recent events upon the uneducated and ill-informed. To do so would be doing a great disservice to many of our citizens.
The EU already has a certain number of good initiatives that could be used to this end, by slightly adapting them, such as for example the Covenant of Mayors, the European Week of Waste Reduction, the European week of Sports, the European Mobility week, etc. Instead of “just” collecting waste, the European Week of Waste Reduction could for example be used to organise discussion rounds at national, regional and local level in order to discuss the added value of European Environmental legislation as such. Same is true for the other aforementioned initiatives.
In addition to the already existing weeks, CEEP could very well imagine organising a European Week of Public Services. During this Week of Public Services, participants at national, regional and local level would discuss the added value of the internal market for the preservation and promotion of their values and identities. Ahead of the White Paper on the Future of the European Union to be published in the first quarter of the year 2017, it could be worthwhile to gather all decentral actions already put in place by the European Union and to analyse how they can better be made use of in order to communicate about the added value of the European Union for each and every citizen.
This brings us to another important lever, namely communication. One of the major problems is that the European Union does not have an own public voice. The abovementioned actions could for example be executed in close cooperation with national, regional and local media. Furthermore, especially after the Brexit referendum, a significant part of civil society in UK stood up in order to defend the idea of European integration. There are very useful campaigns – mostly run in digital media. The question is how the European Union but also national politics can better and earlier assist civil society to get engaged in such a positive communication before crises emerge. Here, again, CEEP and its members who are closest to the citizens are ready to further elaborate on this question.
That is why CEEP thinks that the EU needs a holistic communication strategy to be rolled out at national, regional and local level. This does not mean that we need a new EU communication body. We think the solution can be achieved through a decentralised implementation. Furthermore, holistic does mean to only concentrate on “hard facts” like economic and social data. The recent political discussions, whether at international, EU or national level showed that people need to be emotionally touched. Public services are an example of such an “emotional good” that 500 million Europeans rely on in their everyday life, that are tangible for them and public services and SGIs’ providers are an important intermediator between the EU and the citizens.
Therefore, CEEP is fully ready to accompany the abovementioned actions together with its European and national partners and stands ready for further exchange on the topic.
The success of the White Paper on the Future of the EU indeed widely depends, in our view, on how much the EU institutions will include key players in its shaping. In this regard, we think that EU social partners and their national members can make a real difference in guaranteeing the final legitimacy of the instrument and that is why we call on the EU institutions to closely involve us into the future steps of this project.
 Monti, Mario: A new Strategy for the Single Market – At the service of Europe’s Economy and Society, 9. May 2010.
 Cp. ibid., p. 20.
 Eurobarometer: Special Eurobarometer 307: The role and impact of local and regional authorities within the European Union, February 2009.
 This practice already exists, for instance, in Germany and Italy when it comes to utilities, in the Netherlands when it comes to education and healthcare, in the UK when it comes to healthcare etc.…
CEEP Opinion on the European Pillar of Social Rights – PDF.
The Public Services’ Employers’ Forum also signed a joint statement on the proposed EU Pillar of Social Rights. You can read it here.
- CEEP welcomes the new initiative of the European Commission to streamline the Social dimension of the EMU. The future instruments should address the urgent need to level the playing field all around Europe with the objective of fostering a society that is both economically performant and inclusive.
- We welcome the clear recognition of key services of general interest (SGIs) as essential elements to overcome the crisis and to move towards a deeper and fairer Economic and Monetary Union.
- The Pillar should be a general strategic document which is not legally binding but states different objectives that the member states, regional and local authorities, social partners and citizens should/will be committed to. A proper way forward would be for the Principles of the Pillar to be implemented via the European Semester and to serve as guidance during the drafting of the country reports and Country Specific Recommendations.
- The way forward is not necessarily for the Pillar to produce new EU Social legislation but to make sure that the existing one is still fit for purpose. The EU Social Acquis already encompasses 70 directives providing workers with protection and rights including: information and consultation of workers, awareness of conditions of employment, equal treatment, health and safety. Hence the problem is not quantity but quality.
- The way forward will be for the Pillar to provide an opportunity to foster a better understanding of the differences between the national industrial relations systems and to define possible common reference principles to foster convergence. CEEP calls for the definition of common benchmarks which would promote and develop quality, accessible and affordable public services in the context of national structural reforms.
- Respecting the principle of subsidiarity will be key for the success and widespread acceptance of the European Pillar of Social Rights. As a unique model that would work for every country does not exist, only member states can anticipate the implications of policy initiatives at national, regional and local level.
- The competences in the social area lie mainly with the member states e.g. wage formation is the exclusive competence of the member states and/or social partners, which is why they should always be the entity deciding upon which policy measures to implement to achieve the goals in the pillar.
- The role of the social partners will be equally critical and should therefore be integrated in the pillar in a transversal way, making it clear that social policies cannot achieve their goals and deliver sustainable effects if social partners are not fully involved in their shaping and implementation.
CEEP Opinion on the EU State Aid Modernisation Agenda – PDF
- European state aid rules are of great relevance for the quality and affordability of Services of General Economic Interest (SGEI) in Europe. In particular they can be a significant source of administrative burden and legal uncertainty for public authorities in their task of fulfilling missions of general interest.
- Building on the State Aid Modernisation Agenda, CEEP encourages the European Commission to pursue its efforts towards more administrative simplification, including through a comprehensive assessment and review of the Almunia package as called for by the Committee of the Regions1.
- CEEP took note of the Notice on the Notion of State Aid. Clarifications over the European Commission’s line on local services and financing of infrastructure are particularly relevant for public services’ providers. However, CEEP is generally concerned that the exercise in itself contains a risk of a biased approach and may add rigidity in the Commission’s approach.
- The existing State Aid Framework Rules for Services of General Economic Interest (so-called ‘Almunia package’) plays a fundamental role in the provision of public services. The European Commission should seize the evaluation of the Almunia package by the 31th of January 2017 as an opportunity to enhance and further simplify existing rules.
- Next to specific state aid rules for SGEIs, the GBER is certainly the second most important state aid framework for SGEIs’ providers. CEEP welcomes the on-going initiative to broaden its scope and calls on the Commission to pursue this exercise.
- Regarding sectoral state aid guidelines, CEEP would especially like to stress the need to make EU state aid broadband guidelines fit for purpose to support achieving EU broadband development targets, as recommended by the REFIT Platform.
CEEP Opinion on the EU VAT Action Plan – PDF
- The VAT Directive foresees a specific and balanced regime for public bodies and activities in the public interest which reflects their key role in the social market economy as recognized by the Treaty and respects the diversity of their forms of organisation across Member States. Existing possibilities to exempt and apply reduced VAT rates are crucial to guarantee quality and affordability of public services, even more in times of fiscal consolidation.
- Hence, CEEP welcomes the gradual and pragmatic approach proposed by the European Commission on reduced VAT rates in the VAT Action Plan and welcomes the status quo regarding existing reduced rates. However, a one-size-fits-all approach, i.e. a single European list, does not seem appropriate considering the diversity of tax policies across Member States.
- CEEP has been following attentively discussions in the European Parliament on the VAT Action Plan, notably concerning VAT exemptions some SGEI providers are granted under existing EU VAT rules. CEEP believes that the current regime is balanced and should be maintained as it benefits citizens as end-users and achieving social policy goals.
- In addition, there is room for clarifying at EU level the non-taxation of goods and services provided through public-public cooperation in order to avoid uncertainty arising from divergent national interpretations. In this regard, VAT rules should be more clearly aligned with EU public procurement rules which exempt certain forms of public-public cooperation.
- Regarding the upcoming SME VAT package, CEEP emphasizes the need to define SMEs according to the fiscal rationale instead of implementing the current competition-based EU definition under recommendation 2003/361. The use of this definition would exclude SMEs with a public ownership of above 25% from benefiting from simplification measures, and thus many local public services enterprises.
CEEP Opinion “A strategic approach to pollution in the context of the upcoming evaluation of EU Water Legislation” – PDF
- Precaution is the fundamental principle of drinking water legislation: The current Drinking Water Directive (DWD) is centered on a health-based understanding of water quality as opposed to a mere technical assessment of parametric values and based on precaution as the leading regulatory principle. Any revision needs to maintain and strengthen this focus to preserve the high level of quality currently provided to citizens and preserve raw water resources for future generations.
- Polluters need to be held responsible for the damage they cause: Currently, the responsibility to ascertain low pollution of drinking water and the necessary resources lies almost exclusively with the water and sewage utilities. This “end-of-pipe” arrangement is both counter-productive and unsustainable: It leads to an externalization of the cost of pollution while the polluter is not taken into account, disincentivising any efforts to improve the situation. A stringent application of the “polluter pays” – principle throughout the value chain, including financial contributions by polluters as well as preventive and other measures is thus crucial to ensure a fair retribution of costs and the long-term sustainability of water services
- EU-water legislation should provide comprehensive protection from the source onwards: The existing legislative framework encompasses a series of distinct directives designed to archive the same ends, thus offering a great potential for a comprehensive protection of “later-to be” drinking water at the source. Yet they are often not complementary, making a coherent implementation difficult. Improving overall coherence between the different elements of EU water legislation should thus be a priority during the upcoming or ongoing evaluation exercises, including but not limited to an alignment of relevant thresholds and taking into account not only individual pollutants, but also specific combinations thereof.
- Poor implementation and enforcement hinders good policy outcome: Incomplete or delayed implementation at Member State level is one of the major causes of pollution. Correct implementation and stringent enforcement at all levels of government should thus be made a priority by Member States. In case of non-compliance the EU-Commission should make more frequent use of disciplinary measures, especially if violation of duties under EU legislation continues over longer periods of time.
CEEP Opinion on EU Trade Agreements, adopted by CEEP General Assembly on 08 June 2016 – PDF
- CEEP wants to support a coherent implementation of the EU’s trade strategy and sees free trade agreements as an opportunity to set worldwide well-designed standards to support sustainable development, including by safeguarding subsidiarity and the essential role played by services of general interest (SGIs) and the social economy. Therefore:
- More legal certainty is needed over the safeguard of the provision of SGIs in international trade agreements. Hence, CEEP calls European institutions, and notably the European Commission, to engage into a constructive debate on the possibility to include standard clauses to fully preserve the discretionary power of national, regional and local authorities in how to provide, organise, finance and commission SGIs, and notably services of general economic interest (SGEIs) subject to trade agreement rules.
- The EU should pursue effectively the Sustainable Development Goals 2030 in its trade policy. Binding and enforceable provisions to promote high environmental and labour standards need to be included in all future FTAs negotiated by the EU and any attempt of social and environmental dumping should be prevented. Furthermore, EU Trade agreements need to ensure a better coherence between development goals and trade interests.
- CEEP calls the European Commission and Member states to continue their efforts towards a more evidenced-based, inclusive and transparent trade policy. Furthermore, in a democratic system, competent authorities should not find it difficult to enact any standards because of fearing to be challenged by corporate claims.
- Trade agreements need to be fit for the digital age. Cross-border data flows, if addressed, shall be in compliance with data protection and security rules in force in the country of residence of the data subject. New services should not be automatically included in EU market access commitments without re-negotiation. In addition, the “digital dimension” of products and services shall be negotiated in the context of their respective original classifications.
- The current European legal definition (Recommendation 2003/361/EC of 6 May 2003) for small and medium-sized enterprises (SMEs) does not encompass the majority of local public services enterprises (LPSEs) from its scope because it excludes enterprises with a public ownership of more than 25%.
- The SME definition is widely used both in European and national legislation, as well as in EU financing programmes, in response to the EU policy priorities and more recently the Better regulation agenda.
- However, it appears that the EU SME Definition unnecessarily discriminates against LPSEs for the very nature of their ownership structure. This is notably contrary to article 345 TFEU which states that “The Treaties shall in no way prejudice the rules in Member States governing the system of property ownership”.
- As a consequence, LPSEs cannot take part in a number of funding and financial schemes. They are also constrained by unnecessary and especially disproportionate regulatory burden from which other SMEs covered by the definition are exempted because of disproportionate costs, and therefore may suffer a disadvantage, especially in areas where they are in competition with private enterprises.
- Hence, an amendment to the European SME definition is required in order to guarantee equal treatment to all types of SMEs irrespectively of their type of ownership. Should this not be possible or not desired, future reference to the SME definition should exclude Article 3, Paragraph 4 of the Annex to the aforementioned Commission Recommendation.