Alison Mizzi, Malta Business Bureau (MBB) President, stated that with unprecedented economic challenges as well as legislative and regulatory burdens imposed on businesses by the European Commission, in the past year, it is now time for some “regulatory breathing space.”

Ms Mizzi, in MBB’s Annual Report, emphasised that as the European Commission proceeds with implementing its programme it is important to shift the “business-as-usual attitude” of EU policy makers and legislators towards a more practical legislative approach “that is more in touch with the real economy.”

Ms Mizzi further commented that the Von der Leyen Commission will be remembered as one of the administrations that introduced the most administrative burdens through new reporting obligations on businesses. In particular, she highlighted, the areas of environmental, social and corporate governance (ESG), the Corporate Sustainability Reporting Directive (CSRD), the EU Taxonomy, the Corporate Sustainability Due Diligence Directive (CS3D), the Green Claims Directive, The Ecodesign Sustainable Products Regulation (ESPR) and the Pay Transparency Directive, among others.

“The Commission itself seems to have acknowledged that businesses cannot keep up with all the administrative burdens and that it is impacting their competitiveness. Over the past months it has also committed to a ‘one in one out’ principle,” Ms Mizzi added. She noted that despite measures and commitment to simplify and reduce requirements, she believes that this is “flawed” and that true effectiveness will be reached by eliminating burdens more broadly as part of a comprehensive review.

On the other hand, she does recognize other initiatives taken by the Commission to tackle unwanted burdens on businesses, such as the ‘Competitiveness Check’. This measure will ensure that impact assessments identify the cost of price competitiveness, international competitiveness, SME competitiveness and the capacity to innovate. “I hope that this methodology is applied correctly and consistently moving forward.”

Ms Mizzi also pertained for the need of the introduction of Territorial Proofing or an Insularity Test for a more balanced playing field for local operators, that will leave less burdens on Maltese consumers. She explained that over the years, Maltese businesses have repeatedly emphasized that a one size fits all approach to legislation, especially in policy areas of transport, state aid and taxation, are creating an unlevel playing field and an unproportional burden.

Despite so, she acknowledged that such legislative processes also require several changes by the co-legislators: the EU Council and the European Parliament. Expanding on this point, Ms Mizzi also recommended better regulations within these institutions. “It is disappointing that the 2016 Interinstitutional Agreement on Better Law-Making has gained little to no traction, particularly the crucial provision mandating the co-legislators to conduct impact assessment of substantial amendments made to Commission proposals. The EU Council and the European Parliament have the resources to do this and should apply them with no further delay, if they are to be taken seriously about their claims on prioritizing the competitiveness of European businesses,” Ms Mizzi argued.

Ms Mizzi concluded that social progress is dependent on economic progress, and this is contingent on international competitiveness. It is for that reason that she believes that improved regulation is the future prosperity of Europe. “Policy makers and legislators owe this to European businesses and citizens.”