In a significant move to enhance the European Union’s economic standing, the Council’s permanent representatives (Coreper) have given their seal of approval to a proposal aimed at simplifying EU rules and unlocking additional investments. The proposal, which forms part of the Commission’s ‘Omnibus’ packages, seeks to mobilize around €50 billion in public and private investments to support key EU policies, including the Competitiveness Compass, the Clean Industrial Deal, defense industrial policy, and military mobility.
According to Adam Szłapka, Minister for the European Union of Poland, “Simplification of existing legislation is indispensable for boosting EU competitiveness. In these turbulent times, today’s agreement in the Council is a first step towards unlocking additional investment opportunities that will certainly strengthen our economic position in the global arena.” This sentiment echoes the sentiments of EU leaders who have been calling for a simplification of EU rules to enhance the bloc’s competitiveness.
The proposal amends the ‘Invest EU’ regulation, which is a key program aimed at supporting investments in the EU. By increasing the EU guarantee by €2.5 billion, from €26.2 billion to €28.6 billion, and facilitating the combined use of the ‘Invest EU’ guarantee with existing capacity available under three legacy programs, the proposal aims to make it easier for member states to contribute to the program. The three legacy programs include the European Fund for Strategic Investment (EFSI), the Connecting Europe Facility (CEF) debt instrument, and the ‘InnovFin’ debt facility, an initiative launched by the EIB group in support of research and innovation.
Each of the two measures is expected to mobilize €25 billion of additional public and private investments, bringing the total to €50 billion. This injection of funds is expected to have a significant impact on the EU’s economy, particularly in areas such as clean energy, digitalization, and defense. The proposal also aims to increase the attractiveness of the ‘Invest EU’ member state compartment, which focuses on specific national priorities, and reduce the administrative burden of implementing partners, financial intermediaries, and final recipients.
One of the key benefits of the proposal is the reduction in administrative requirements, which is expected to result in cost savings of €350 million. The proposal revises the definition of Small and Medium-sized Enterprises (SMEs) and reduces the number of indicators on which implementing partners will need to report for small-size operations not exceeding €100,000. Additionally, the proposal reduces the frequency of reporting obligations from implementing partners, going from semi-annual to annual reporting. These changes are expected to make it easier for SMEs to access funding and reduce the bureaucratic hurdles they face.
The approval of the Council’s negotiating mandate by Coreper marks a significant milestone in the legislative process. The presidency is now enabled to enter interinstitutional negotiations (trilogues) with the European Parliament to reach a provisional agreement on the proposal. This is a crucial step towards finalizing the proposal and making the necessary changes to the ‘Invest EU’ regulation.
The background to this proposal dates back to October 2024 when the European Council called on all EU institutions, member states, and stakeholders to prioritize work on simplifying EU rules. The Budapest declaration of November 8, 2024, subsequently called for a “simplification revolution” to ensure a clear, simple, and smart regulatory framework for businesses and drastically reduce administrative, regulatory, and reporting burdens, particularly for SMEs.
On February 26, 2025, the Commission put forward the proposal as one of two ‘Omnibus’ packages aimed at simplifying existing legislation in the field of EU investment programs. EU leaders urged the co-legislators to take work forward on the first two Omnibus packages as a matter of priority and with a high level of ambition, with a view to finalizing them as soon as possible in 2025.
The proposal has been welcomed by EU officials and stakeholders who see it as a major step towards enhancing the EU’s competitiveness. With the global economy facing numerous challenges, including rising protectionism and trade tensions, the EU needs to take bold action to remain competitive. By simplifying its rules and regulations, the EU can create a more favorable business environment, attract more investments, and promote economic growth.
As the EU continues to navigate the complexities of the global economy, the approval of this proposal marks a significant step towards achieving its goals. The next steps will be crucial in determining the success of the proposal, and EU officials will need to work closely with the European Parliament to finalize the agreement. However, with the backing of EU leaders and the support of stakeholders, there is optimism that the proposal will be successful in unlocking additional investments and promoting economic growth in the EU.
In conclusion, the EU’s decision to simplify its investment rules is a major step towards boosting its competitiveness. The proposal, which aims to mobilize around €50 billion in public and private investments, has the potential to have a significant impact on the EU’s economy. By reducing administrative requirements and making it easier for member states to contribute to the ‘Invest EU’ program, the proposal can help create a more favorable business environment and promote economic growth. As the EU continues to navigate the complexities of the global economy, this proposal marks a significant step towards achieving its goals and remaining competitive in an increasingly challenging world.
We acknowledge The European Times for the information.
