Definition of small and medium-sized enterprises (SME): Second external consultation on the Internet

July 8, 2002

Brussels, 05 July 2002

The SME definition currently in force in Community law is that adopted by Commission Recommendation 96/280/EC.

This text requires modification to:

  • take account of economic developments and
  • reduce the likelihood of the definition being circumvented, particularly with regard to state aid, Structural Funds and the Research and Development Framework Programme.
Following a consultation on the Internet in Autumn 2001, the text of the preliminary draft of the definition of small and medium-sized enterprises was modified (see "background").

The revised preliminary draft has already received wide agreement from the consulted national authorities in the framework of the Enterprise Policy Group. In view of the very large number of enterprises concerned and owing to the fact that it is an autonomous act of the Commission for which the application of good governing principles takes on a special importance, Mr Erkki Liikanen, Commissioner responsible for enterprise policy, requested a second consultation to make it possible to carry out an ultimate check of the foreseen terms:

Modified draft of the SME definition (version of 25 June 2002):

Draft Communication of the Commission and model of declaration:

(The Originals are in French: the other language versions have not yet been checked by the legal revisers)

The Commission invites all interested parties to forward their comments on both draft texts before 10 September 2002 , by electronic mail to the following address:

At the end of 2001, the Commission (Enterprise Directorate-General) launched a wide-ranging external consultation (closed on 9 November 2001) concerning the revision of its recommendation on the SME definition. The text of this consultation can be consulted at the following address: nsultations/sme_definition/index.htm

Results of the first external consultation on the SME definition

The improvements made to the draft following this first consultation were numerous and significant, showing the considerable interest raised by this, as well as the quality of the contributions received:

These improvements or changes are in particular:

  • An important rise in the financial thresholds for micro-enterprises;
  • The proposal for a model of a declaration by enterprises. This model is purely indicative and has no obligatory character. It also comprises of "instructions" for enterprises which should make it possible to avoid the risks of uncertainty regarding interpretation. According to our estimates, 95% of enterprises concerned would only have to fill in the first page of this declaration.
  • Clearer typology of enterprises ("autonomous", "partner", "linked" enterprises), makes it possible to grant to partner enterprises a much more favourable treatment than that under the 1996 recommendation. This aims to encourage, in particular, innovation and the internationalisation of SMEs.
  • The taking into account of apprentices or students in professional training to benefit from an apprenticeship contract or professional training, will receive an even more favourable treatment than initially envisaged.

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