Red tape imposing costly 'burden' on European businesses

The cumulative cost to Europe’s businesses of the various regulations and rules with which they must comply amounts to €1 trillion over the past 11 years, it has been claimed.

The research from Eurochambres, the representative body for Chambers of Commerce across Europe, also revealed that the annual cost of all EU regulations is in excess of 12 per cent of EU GDP.

David Frost, the director general of the British Chambers of Commerce, said: “Businesses are facing the toughest economic environment for a generation. Company cash flow is being squeezed and unemployment is growing as a result.

“The EU needs to get serious about reducing the massive burden of regulation on business. Cutting unnecessary burdens and announcing a moratorium on new employment law would be an effective way of providing instant and inexpensive help to British firms.”

In a separate report, however, the UK has been commended for its efforts at reforming the regulatory system.

According to the Organisation for Economic Co-operation and Development (OECD), the UK government has made good progress in limiting the adverse administrative impact that new rules and regulations can have on businesses.

The OECD applauded the government’s policy of assessing proposed regulations in a more business-sensitive manner.

Nevertheless, the OECD described the UK reforms so far as patchy and urged a more systematic approach to reducing the total number of regulations and regulatory agencies.