The European Commission published a new Recommendation on business transfers. Facilitating the transfer of ownership of small and medium enterprises (SME) responds to a pressing demographic challenge: a growing number of small business owners across the EU are approaching retirement without a designated successor. This has the potential to impact millions of companies over the next decade. Where a transfer fails, jobs, know-how and economic value may be lost. Furthermore, in the absence of European buyers, strategic European businesses may increasingly be acquired by foreign competitors and investors.
The Recommendation builds on the 1994 Recommendation on business transfers. While maintaining many of its core principles, the updated Recommendation places greater emphasis on awareness-raising, legal and tax measures, digital matchmaking platforms for buyers and sellers, and coordinated EU-level cooperation to preserve business continuity and jobs within the EU. For example, it encourages Member States to reduce administrative, legal and tax barriers to cross-border business transfers, helping businesses make full use of the opportunities offered by the Single Market. It also recommends developing dedicated financing and training programmes to broaden the pool of potential successors and entrepreneurs, including women and other under-represented groups in entrepreneurship.
This new guidance is already in today’s agenda of the meeting of the SME Envoys Network with EU Member States and SME associations.
