The diagnosis is clear

More than 60 per cent of European companies consider excessive regulatory burdens to be a major barrier to investment in the EU. For SMEs, bureaucracy remains the single greatest obstacle to growth. Echoing Mario Draghi’s assessment, the OECD confirms that the rising regulatory burden in the EU absorbs considerable resources, diverts businesses from productive activities and raises the fixed costs of doing business – with negative implications for scaling, innovation and competitiveness.
The EU has truly grasped the problem, hasn't it?

In principle, the European Commission has acknowledged the problem of excessive regulatory burdens. Following the substantial expansion of EU legislation under the Green Deal, Commission President Ursula von der Leyen has announced an “unprecedented” simplification agenda: a 25 per cent reduction in reporting requirements for businesses; a series of omnibus packages; and a “deep clean-up” of the entire EU acquis. However, the most significant structural issue remains unaddressed: the continued influx of new regulations and burdens.

In the first year of the current term alone (2025), the European Commission has proposed more legislative acts than since 2018. The increase is particularly pronounced in secondary legislation: since 2021, more than 1,200 delegated acts and implementing acts have been adopted annually – equivalent to almost four per day. As large parts of the Green Deal still need to be finalised through secondary legislation, this trend is likely to persist, creating additional burdens for businesses.

A new paradigm in European policymaking

Unless the inflow of new regulatory burdens slows down significantly, the European Commission’s simplification agenda is doomed to fail. The BDI calls for a fundamental shift in the approach of EU regulators: rather than continuously expanding the body of EU law, the focus should be on effectively optimising existing regulatory frameworks to promote investment, innovation and growth. New EU legislation should only be introduced if it is genuinely necessary, provides clear European added value and strengthens competitiveness. This principle must apply equally to secondary legislation.
The European Commission’s latest communication on better regulation offers a cautious grounds for optimism. The Commission commits to greater ‘regulatory discipline’ through a more systematic application of the principles of proportionality and subsidiarity, as well as the principle of ‘simplicity by design’. Whether this commitment will have any significance beyond mere rhetoric will become evident in the forthcoming work programme.