French proposals to simplify EU law

At the 24 October meeting of the European Council, the French president F. Hollande put forward a project to simplify EU law based on three pillars : "delete all obsolete directives ", " limit supporting documentation required " and " adapt the law to the end-users ."
This reform drive views itself as the natural complement to the national effort (labelled "simplification shock" and reported in previous posts) which has already generated 200 measures, with more to come in coming weeks aimed at citizens and business, and new measures to facilitate judicial redress.
The economic impact of the programme, which should not be mistaken for deregulation, is still being assessed. The extension from 10 to 15 years of the validity of the ID card will for example generate a 25% reduction of administrative costs. A new integrated planning procedure to accelerate the construction of 20,000 has a potential revenue for the construction sector of € 3 billion ," says the Elysee.
For more, see Acteurs Publics article.

L'Elysée résume les résultats du choc de simplification

Un communiqué de la présidence de la République (24 octobre) nous informe que le chef de l'Etat a présidé, aujourd'hui, la deuxième réunion de ministres sur le choc de simplification engagé le 14 mai dernier. Le président de la République s'est félicité que quatre projets de loi aient déjà été élaborés pour simplifier le droit par voie d'ordonnances. La première loi a été adoptée en juillet pour simplifier les règles applicables à la construction. La seconde, destinée à simplifier les relations entre les citoyens et l'administration, devrait l'être le 30 octobre. Le troisième projet relatif à la simplification de la vie des entreprises, en cours de discussion au Parlement, sera voté d'ici la fin de l'année et les ordonnances qui s'y rapportent seront adoptées, au plus tard, au printemps 2014. Le quatrième qui concerne les relations des citoyens avec la justice sera examiné en Conseil des ministres dans les semaines à venir.

Le chef de l'Etat a noté les résultats concrets que les 200 mesures de simplification arrêtées par le gouvernement auront tout au long du quinquennat sur la vie quotidienne des Français, des chefs d'entreprise, des élus et des fonctionnaires. Plusieurs principes qui modifient en profondeur le paysage administratif sont en voie d'application :

- Le principe du « 1 pour 1 » : dans le cadre du gel des normes en vigueur depuis septembre, le gouvernement publiera, tous les six mois, le coût des normes nouvelles qui devra être strictement compensé par le coût des normes supprimées ;

- Le principe du « silence vaut accord » : l'inventaire de toutes les démarches soumises à autorisation de l'administration sera achevé à la fin de l'année pour engager l'application du principe selon lequel le silence de l'administration vaut accord ;

- Le principe de la « confiance a priori » : les entreprises ne seront plus tenues, pour diverses démarches, d'adresser les pièces justificatives mais seulement de les tenir à disposition en cas de contrôle ;

- Le principe du « Dites-le nous une seule fois » : l'Etat investira dès 2014 dans des systèmes d'information communs aux différentes administrations afin que les entreprises aient à fournir, une fois seulement, une information.

Les simplifications décidées se traduiront concrètement par un gain de temps et d'argent pour les entreprises comme pour les citoyens et l'administration. [...] Le président de la République a validé la proposition du Premier ministre de renforcer l'organisation au service de la simplification : Guillaume POITRINAL, chef d'entreprise, et Thierry MANDON, député, surveilleront la mise en œuvre des simplifications au profit des entreprises, en vérifieront les résultats et en rendront compte au public. [...] Le chef de l'Etat proposera, lors du Conseil européen des 24 et 25 octobre 2013, une action vigoureuse en matière de droit européen. Il convient, en effet, de simplifier ce droit, sans abaisser les exigences en matière de protection, afin d'éliminer les complexités injustifiées qui pèsent sur notre droit national. [...]

Independent better regulation council to be formed in Norway

According to a news item from  Regelrådet,(the Swedish Better Regulation Council), the newly elected Norwegian government has announced in its platform that an independent better regulation council will be formed. It is to be formed based on its Swedish counterpart. The government has also set a net target of 25% for reducing costs to businesses incurred by legislation. They also intend to simplify the public reporting portal Altinn even further to secure that businesses only have to report once." There are already such oversight bodies in the NL (Actal)), the UK (RPC)) and Germany (NKR). There is other interesting news on the Regelrådet page, like the government decision to make Regelrådet a permanent feature in the Swedish legislative process.

Limited impact of the shutdown on regulatory production

Regblog has published an interesting article investigating in detail how government shutdowns can affect the stream of regulation, using past examples (1995-1996) as well as first impacts of the most recent one. The conclusion is encouraging: the effects of a freeze of regulatory activity are temporary and the machine soon catches up. "This glance back at the shutdowns from the 1990s does suggest that a shutdown does not create long-lasting effects on agencies’ regulatory capacities. It might take them a while to warm up after the shutdown, but as long as politicians do eventually come to an agreement and re-open government, federal agencies will fairly soon be back in business protecting health, safety, and the environment."

Improvements in application of EU law

Every year since 1984 the Commission has presented an annual report on monitoring the application of Community law during the preceding year. After a bad 2012 report, this year's edition published today (22 October) shows some improvement.
The correct application of EU law is a cornerstone of the EU Treaties and at the heart of the Commission's regulatory fitness programme (REFIT). The 30th Annual Report on monitoring the application of EU law shows how Member States are performing in applying EU law. There were fewer infringements open at the end of 2012 than previous years. The number of cases in problem solving mechanisms such as EU Pilot increased. This reflects the determination of the European Commission to work with the Member States to solve problems and improve compliance.
At the end of 2012, the number of open infringement procedures decreased again, by 25 % compared to the previous year. This is related in part to the more frequent use of EU Pilot (a database database that helps establish theconformity of national rules with EU law) and other problem solving mechanisms (such as SOLVIT) which aim to solve problems and promote compliance (see press release).

Culture change for regulators (Australia)

The Australian Productivity Commission release a research report earlier this month on "Regulator Engagement with Small Business" according to which "Regulators can do more to reduce the compliance and enforcement burdens they impose on small businesses. The Commission argues that regulators should ensure they understand how regulation impacts on small business and keep the compliance capacity of small businesses at the forefront of their minds." A regulator's culture and attitude towards business should include the following improvements:

• Regulators should adopt a multi-channel approach to communicating with small businesses with a focus on the brevity, clarity and accessibility of information. 
• Compliance and enforcement strategies should be proportionate to risks posed to communities and facilitate voluntary compliance. 
• Regulators should commit publicly to target timeframes for key processes, report on their performance in meeting targets, and consider other measures to improve timeliness. 
• Regulators should have access to a sufficient range of enforcement tools and be resourced to do their job effectively, to avoid the shifting of direct and indirect costs onto businesses.

UK takes new aim at EU red tape

Widely reported in the media, the UK Government's new drive against EU red tape. On the strength of a report 'Cut EU Red Tape,’put forward by a panel of six business leaders including Marks & Spencer chief executive, the Prime minister will be seeking more action at EU level at the summmit next week in Brussels.
The panel which was established after last June's EU summit, has just tabled its report which includes a series of 30 recommendation to slash labour rules of EU origin, including exempting companies with less than 10 employees from all new employment laws, ending plans to compel restructuring businesses from paying to retrain redundant staff, and allowing employers to change employment contracts in TUPE-style takeover situations.
Also included: scrapping the need for small businesses in low risk sectors to keep written health and safety records, scrapping proposals on shale gas, implementing the law on cross-border services and revamping rules limiting employee working hours. The report looks at barriers to overall competitiveness, to starting a company and employing people, to expanding a business, to trading across borders and to innovation. In several areas it calls on the EU to take further legislative steps by, for example, completing the digital single market or adopting rules to cap payment card fees
In addition to the 30 recommendations, the taskforce has designed a "filter" to ensure future EU laws are not overly burdensome on companies across the continent, which relies on better RIAs and a competitiveness test to ascertain that the new regulation is indeed required.
For more, see Daily Telegraph article, Reuters and European Voice summaries. The Guardian calls for a careful distinction between red tape and useful, protective, regulation.

EU Regulatory Fitness: results and next steps

On 2 October 2013, the Europan Commission published a Communication (COM(2013) 685 final) on "Regulatory Fitness and Performance (REFIT): Results and Next Steps" which will be of great interest to smart regulators.
Extract from the press release:
"Whereas regulation at EU level is essential in many areas, it is often accused of stifling businesses, especially the smallest ones, or of interfering too much in citizens' daily lives. 74% of Europeans believe that the EU generates too much red tape. In response to that concern, the Commission has made a concerted effort over the past few years to streamline legislation and reduce regulatory burdens. In his 2013 State of the Union address on 11 September, President Barroso stressed the importance of smart regulation and declared that the European Union needs to be "big on big things and smaller on small things".
Today, the Commission takes another important step in ensuring that EU legislation is fit for purpose. In a Communication the Commission sets out in a concrete way, policy area by policy area, where it will take further action to simplify or withdraw EU laws, ease the burden on businesses and facilitate implementation. It is the result of a screening of the entire stock of EU legislation. The Commission also announced today the intention to publish a scoreboard to track progress at European and national in this regard. This exercise is at the heart of the Commission's Regulatory Fitness and Performance Programme (REFIT). "
The Commission website offers a summary of results of the 2007-2012 Action Programme for reducing administrative burdens in the EU, claiming that "the programme has reached its target its target of cutting 25% the administrative burdens stemming from EU legislation (estimated at €124 billion). The measures adopted at EU level until December 2012 are worth € 30.8 billion in annual savings for businesses.
The Commission exceeded the target by tabling proposals with a burden reduction potential close to €41 billion (33%). Some of this potential was lost in the legislative process as the Commission proposals were amended.
If all the Commission's proposals still pending before Council and Parliament in December 2012 are adopted, the total estimated burden could be reduced by 30.5 % representing total annual savings for businesses of €37.6 billion."

Le budget soutient la MAP, et réciproquement (France)

La direction du budget vient de remettre son rapport d'activité 2012 et il est intéressant d'examiner la partie consacrée à la MAP (p. 48) : "La modernisation de l'action publique (MAP) a été lancée en octobre 2012 avec pour objectif de définir et mettre en oeuvre des réformes structurelles tout en améliorant la qualité des services publics. La MAP doit ainsi contribuer au redressement des finances publiques et à la compétitivité de l'économie, principalement via les évaluations des politiques publiques (EPP), les programmes ministériels de modernisation et de simplification (PMMS) et des chantiers transversaux. L'exercice est piloté par le secrétariat général pour la modernisation de l'action publique (SGMAP). La direction du Budget lui apporte les données de cadrage budgétaire et de finances publiques. [...] La direction du Budget a également été associée à l'élaboration des programmes ministériels de modernisation et de simplification. Elle est par ailleurs fortement impliquée dans certains chantiers transversaux portant sur la rationalisation de la chaîne de dépense de l'Etat, ou l'amélioration de la politique d'achats de l'Etat. Le travail de la direction du budget (préparation du budget annuel et des budgets pluriannuels, propositions de réformes structurelles, prévisions de finances publiques à moyen terme, suivi de la performance notamment) alimente la démarche de revue de la dépense conduite à travers la MAP. Inversement, les travaux conduits dans le cadre de la MAP sont indispensables pour nourrir la procédure budgétaire de pistes de réformes ambitieuses et contribuer au respect des engagements en matière de finances publiques."
On notera également une nouvelle mission sur la maîtrise des dépenses publiques, qui examinera en particulier la responsabilité de la complexité du droit interne aux administrations dans les dérives budgétaires. L'idée est d'associer plus étroitement les collectivités territoriales à l'assainissement des finances publiques, en harmonisant les compétences, les budgets et les comptabilités des trois fonctions publiques (Etat, protection sociale, collectivités) et simplifier leur mise en œuvre au sein de la MAP.

"Communist" red tape under the knife

Delightful story not requiring any comment, from BEIJING, Oct. 13 (Xinhua) -The discipline watchdog of the Communist Party of China (CPC) has begun the second stage of its campaign to cut red tape in its system. The second wave will run until June next year, and target regulations or normative documents from the founding of the New China in 1949 to 1978, according to a statement by the CPC's Central Commission for Discipline Inspection (CCDI) on Sunday. The move will give the commission a clear picture of the existing regulatory situation and clarify the fight against corruption using legal weapons.

The first stage of the CPC's campaign, which began in June last year, focused on rules introduced from 1978 to 2012. The Party had abolished nearly 40 percent of its intra-Party rules introduced since 1978 as of Aug. 28, and the CCDI abolished 37 and nullified 28 of 476 rules introduced by it since 1978. The central authority and local Party committees also overhauled their ruleboook

"Common sense" cuts to red tape (UK)

The business minister announced on 1 October an array of "common sense" measures to simplify reporting on workplace accidents and other corporate reporting requirements, and protect companies against unfair risks and litigation. The reforms coming are part of the government’s drive "to make the UK the best place to start and grow a business. They respond directly to issues raised by business, including through the Red Tape Challenge, which invites firms to give their views on which regulations should be removed or improved."  For the detail of the measures, go to the UK Government press release.

Making the best use of soft law (France)

Smart regulators know that according to the principle of necessity, regulation should only be used when there is no other way of achieving the policy objective. This is why the report on "le droit souple" (soft law) issued this week by the French Conseil d'Etat (CE) is going to be so useful. The CE (council of state) examines the recent development of soft law in its various forms and recommends that the government develop a doctrine on the use of this instrument to promote simple and high-quality regulation.
For the CE, soft law includes codes of conduct, best practice dissemination, the new European economic governance, self regulation by independent bodies and many other forms. These manifestations have in common that they do not impose specific obligations but aim to achieve policy objectives in a complex and uncertain society where regulation is increasingly present, often with the assistance of the end-users themselves.The CE wants to raise awareness of the growing importance and use of soft law by both public authorities and private companies in France and around the world .
Definition. Soft law includes all prescriptive instruments that meet three conditions:
• they modify or guide the behavior of their addressees while enlisting, as far as possible, their support;
• they do not per se create legal rights and obligations for their addressees;
• they feature, by their content and origin, a degree of formalization akin to legal rules.
How to make good use of it. The report offers a doctrine and operational tools, in the shape of 25 proposals for a rational use of soft law, which recommend inter alia:
• check the need for soft law on the basis of three "tests": usefulness, effectiveness and legitimacy;
• favour shorter regulatory texts by allowing regulators to detail implementation by guidance or technical standards;
• guarantee the publication including online of soft law instruments issued by public authorities;
• update the process of drafting corporate governance rules by listed companies;
• set up a public monitoring capacity for soft law generated by private actors, based on the most relevant departments.

"Behaviourally-informed" regulation on the rise

A fascinating article by top-expert Alberto Alemanno on the more frequent use of this new kind of smart regulation: Here is the abstract: "As behavioural sciences are unearthing the complex cognitive framework in which people make decisions, policymakers seem increasingly ready to design behaviourally-informed regulations to induce behaviour change in the interests of the individual and society. After discussing what behavioural sciences have to offer to administrative law, this paper explores the extent to which administrative law may accommodate their findings into the regulatory process. After presenting the main regulatory tools capable of operationalizing behavioural insights, it builds a case for integrating them into public policymaking. In particular, this paper examines the challenges and frictions of behavioural regulation with regard both to established features of administrative law, such as the principle of legality, impartiality and judicial oversight and more innovative control mechanisms such as the use of randomized control trials to test new public policies. This analysis suggests the need to develop a legal framework capable of ensuring that behavioural considerations may inform the regulatory process while at the same time guaranteeing citizens' constitutional rights and freedoms vis-à-vis the Regulatory State."

Regulatory policy and trust in government

Speaking at a recent event organised by Salzburg Global and the Volcker Alliance on ‘Restoring the Public’s Trust: Delivering on Public Policy Goals’, the Secretary General of OECD, Mr Angel Gurria, listed the elements of a "strategy for trust" that OECD could recommend to national governments, built on three pillars: integrity, transparency and engagement. Mr Gurria defined the current situation as a crisis of trust, trust being "the cornerstone of effective governance, the main ingredient to promote economic growth and social progress. Like never before, our countries are running dry of this precious asset. Like never before, our citizens have doubts about their government’s capacities to make the right decisions. And like never before, we need to take the necessary measures to recover that confidence."
Regulatory policy could contribute significantly to improve transparency and restore trust in government, said Mr Gurria: "Our regulatory and supervisory structures have failed us in many important ways. This is resulting in a degradation of the idea of the State as that strong institutional framework that guaranteed our safety, our prosperity, our right to succeed, through a system of checks and balances inspired in a crucial principle: accountability. Our governments now need to make a major effort to restore this certainty and with it the respectability, the credibility, of the State. The OECD is supporting these efforts, with different tools: like our recently updated Principles on Regulatory Quality, the OECD Working Group on Bribery; the Annual High-Level Anticorruption Conference for G20 Governments and Business; and the CleanGovBiz Initiative, to name but a few."

Good roadmap for regulatory reform (Rhode Island)

Experts seeking a recent formulation of a regulatory policy addressing the needs of small business could do well to check out a recent article by Ms Serpa, Rhode Island Democratic state representative and chairwoman of the House Committee on Small Business. "Regulatory reform isn’t the sexiest topic in state government, but for small-business owners it’s everything. I know this, many of my colleagues in the General Assembly know this, and it is my belief that Rhode Island is coming close to achieving tangible progress in streamlining our regulatory processes."
Ms Sherpa refers to a RI Office of Regulatory Reform paper entitled “Period 1 Regulatory Look Back Report”  which takes stock of the current review of all legislation and formulates 10 key recommendations (summarized as follows):
•"Map the regulatory environment: Rhode Island should provide an up-to-date map of state-government organization so small-business owners aren’t lost as to where to find information about how to start a business, how to expand their businesses or simply how to stay in compliance with state guidelines.
•Reduce the number of statutory exemptions: More than 20 percent of reviewed regulations across 22 regulatory entities were exempt from the reform process because of either separation-of-powers considerations or the law’s definition of “small business.” The lack of clarity in the definition of “small business” poses a consistent challenge, and it’s one ORR recommends we tackle in the future.
•Improve accessibility to regulations: Small businesses reported needing outside professional help to navigate the 26,240 pages of regulation. The report aptly points out that those documents are the equivalent of 10.1 copies of “War and Peace.” To worsen matters, each regulatory entity uses a different template for writing regulations. The bottom line: We need to make this process more uniform.
•Rejoin separated regulation: Breaking down one regulation into separate regulations in the past has resulted in confusion about how to comply with basic guidelines. This must be rectified.
•Reform audit, inspection and enforcement processes: These practices have as much impact on small business as regulatory policy and need to be reviewed alongside regulatory reform.
•Promote lawmaker and small business participation in reform: Lawmakers should be involved in this process just as much as members of the business community should provide feedback. We are only in the first stage of recommendations. There needs to be more dialogue. I would even go one step further to suggest a presentation to the General Assembly on these ORR findings and recommendations so we can put a spotlight on these issues and deliberate on them effectively in future sessions.
•Support improved cost-benefit analysis: The state is always concerned with data quality, and we want to strive to ensure that it can accurately quantify basic regulatory statistics.
•Push regulatory reform efforts beyond current performance levels: Of the 179 regulations identified by entities and ORR as having a small-business impact, 26 were offered for amendment and repeal. We can do better. As we move forward with rigorous review, ORR will challenge our departments to find more areas of reform. A large part of our economic environment is dependent upon how quickly this state can turn around and streamline these processes for small businesses."

SCM Working Group Helsinki Meeting

On 20 September 2003, the SCM Network working Group meeting was held in Helsinki, Finland. More than 30 delegates attended for this meeting, which included for the first time, delegates from Croatia. The meeting was opened by the Hon. Janne Metsamaki, the Finnish State Secretary responsible for reducing Administrative Burdens. He stated that the Finnish Government has committed itself to avoid both increasing the costs incurred for and adding to the regulatory burden on the industry through its decisions. 

Even though there is no reason to feel pleased about the economic downturn in the Euro area, Hon. Metsamaki said that this situation has brought the bureaucracy experienced by businesses in Finland into greater focus in public debate. Politicians cannot afford to weaken the operating conditions of companies with excessive bureaucracy. He mentioned that the one good thing that will come out of this downturn in economic activity is that policy-makers are now better equipped to make decisions with a genuine impact on reducing the burden on businesses.

The meeting discussed the various initiatives that are being implemented in a number of Member States when it comes to the development of eGovernment for the various services being offered by Government Entities to the business community and the citizens.

Gerald Reindl explained how in Austria, they have introduced the Austrian Business Service Portal. This a central eGov one-stop-shop for businesses which will provide information and transactions, enable businesses to have an efficient administrative procedures with the Federal Government while at the same time cutting costs of up to € 300 million.

Janek Rozov presented the Estonian case of their development of a Register of Economic Activities. The objective of this project was to standardise public services and develop physical and virtual service environment according to citizens' perspective. The advantages of having such a Register is that Estonia managed to group the regulations about economic activities into one general Act. Thus all the necessary information that one needs to know about areas of activity subject to special requirements, were assembled in one place. With this Register, applications for licences, notices and information of economic activities can be affected through this channel of communication.

Pierre Schilling, showed how the MyGuichet functions in Luxembourg. Through this system, all forms can be filled and sent on line. Moreover, both the citizens and the businesses can follow-up on the procedure and state-of-play of application. Communications and notifications are done via the same system. To ease the process, documents can be uploaded on the system and the procedures can be carried out by a proxy.

Elina Koskentalo delved into the development of the XBRL system in Finland. The eXtensible Business Reporting Language (XBRL) helps businesses to present the financial data in a structured and machine readable format. Moreover, the system will process the data in an automated formation and processing of reports. The benefits from such a system results from having easy accessible data, reliability of data, comparability, economical transparency and the availabilty of real-time economy data.

 Kostantinos Bovalis, gave a detailed presentation on what the European Commission is doing in this field. He mentioned that the challanges facing public administrations is that of improving the quality of their operations so as to have increased competitiveness and productivity for EU businesses. The need is there to develop synergies among institutions so as to enable effective resource utilization in piblic sector agencies.

The ISA - Interoperability Solutions for Public Administration – system that the EU had developed, has interoperability aimed at introducing an efficient eGovernment services  both at national and at EU level.  Elisabeth Kristensson explained how they have created a technical infra-structure for reporting once only obligations. She mentioned that the Swedish Government embarked on a project whereby by 2020, business community will in most cases submit information once and to one place. By doing this, the businesses will feel a positive and noticeable change in their day-to-day operations.  When this system is in place, the one million plus companies, will save a yearly 2.25 billion SEK in administrative burdens. (summary by Paul Debattista, Malta)