Is EU red tape making it harder to do business?

What exactly is “red tape”? We often hear that the EU has “too much red tape” but what does that actually mean? The term is one of those quirky English idioms, expressing the idea of overbearing bureaucracy and inflexible government regulation. Nobody believes businesses are literally being wrapped up in red tape by bureaucrats from Brussels. Instead, the phrase conveys the sense that pointless European rules are strangling free enterprise.

So, is red tape always bad? The quickest way reduce the regulatory burden on businesses would be to scrap worker rights, slash environmental standards, and chuck out consumer protection rules. Needless to say, voters actually quite like worker rights; they like a clean environment; and they like being protected from faulty or dangerous products. So, who determines which rules are “red tape” and which are worth keeping?

What do our readers think? We had a comment come in from Lubomir (Любомир), who thinks the EU Single Market is over-regulated. He believes the EU needs to cut red tape in the “common European market in order to allow more competition and make it easier for companies to do business. European citizens don’t need regulations on the [shape] of cucumbers and bananas. They need more economic freedom!”

To get a response, we put Lubomir’s comment tot Alexander Stubb, the former Prime Minister of Finland, when we spoke to him at the State of Europe roundtable in Brussels (organised by the think tank Friends of Europe). What would he say?

We also had a similar comment from Paul from the UK, who argues that “the EU needs to seriously reduce all the petty and pointless red tape which costs businesses billions and prevents them employing more workers”. Is this something that Brexit could achieve? A bonfire of red tape?

To get a response, we put Paul’s comment to Frédéric Mazzella, the founder and President of BlaBlaCar (and one of Friends of Europe’s European Young Leaders). What would he say?

Yes, red tape is something that slows down businesses, and that’s why we want to create a European [“level playing field”] in order to unify all the rules in the same geographical area. Which is why Brexit is not good news, in that sense, because what we really want to do is create a harmonised and large geographic area where business is conducted the same way.

So, the best way to reduce red tape is to grow the level playing field and create a real European [Single Market]. And I would say that if Paul has the occasion in the coming months or years – and I don’t know if this is going to happen – to vote again or do anything that will bring the UK back into the EU, then that’s the solution to being more efficient.

For another perspective, we also put Paul’s comment to Kati Levoranta, CEO of Rovio Entertainment Corporation, a Finnish video game developer best-known for the successful Angry Birds franchise. What would she say to Paul?

Is EU red tape making it harder to do business? Is the European Single Market over-regulated? Or are these regulations in fact vital for the protection of worker rights, environmental standards, and consumer safety? Let us know your thoughts and comments in the form below and we’ll take them to policymakers and experts for their reactions!

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