EU client policy

How Signa was able to pass as an SME

A giant corporation with hundreds of subcontractors was considered an SME.

(Bild: Anja Richter)

EU Commission President Ursula von der Leyen has declared the reduction of "excessive bureaucracy and administrative burdens" to be a priority for the new legislative period 2024 - 2029. This also harbors risks, as the simplification of EU legislation opens up loopholes for companies. Signa is a good example of this.

Under the "guise of reducing bureaucracy", companies have been given carte blanche to "damage the economy, the welfare state and the environment" in recent years, criticizes the Chamber of Labour. For example, real estate juggler René Benko's Signa was able to pass as a small and medium-sized enterprise (SME) with simplified reporting obligations and deceive about balance sheets. 

AK study shows focus on economic interests
The Chamber of Labor has commissioned a study on this, which is available to the "Krone". The main result: the original problem, that the EU regulation was not comprehensible enough, was narrowed down in such a way that the interests of the economy were given priority over all other interests. AK expert Frank Ey: "Under the slogan of 'de-bureaucratization', standards for employees, consumers and society could be sacrificed to the benefit of companies. In order to implement this agenda, a structure has also been created that is highly questionable in terms of democratic policy."

Ursula von der Leyen is under fire.

(Bild: APA/AFP/POOL/ALESSANDRO DELLA VALLE)

One-in, one-out principle as a lawnmower
For example, there is a priority for SMEs when it comes to reducing reporting obligations and responsibilities for companies - whereby the term SME has been defined more and more broadly and now covers 99.8 percent of all companies. Large companies such as Signa Holding also qualify as SMEs with correspondingly simplified reporting obligations. "Another example is the one-in-one-out principle, according to which an old regulation has to be dropped for every new one. You can safely call this the lawnmower principle," says Ey.

Fewer reporting obligations planned for animal diseases
Important regulations with high added value for employees, consumers and society could thus be removed. Green Deal measures could be replaced by other environmental protection measures. Laws relating to labor law or consumer protection could also be sacrificed. For example, the Commission describes the protection of workers from asbestos as a burden in a report on the administrative burden, without offsetting the health costs. And a proposal that sounds particularly absurd after the coronavirus pandemic: fewer reporting obligations in cases of animal diseases.

Workers' rights could be curtailed.

(Bild: aurena.at)

Own SME representative
The players in this agenda setting are active in various expert committees. Most recently, a dedicated SME representative was appointed, who reports directly to the Commission President and can also attend meetings of the Regulatory Scrutiny Board (RSB). This is practically upstream of the legislative process; for example, the EU Commission only publishes draft legislation once it has been approved by the RSB. Representatives of all other social groups and interests, such as trade unions or NGOs, only gain access to EU legislation much later. The RSB is not even democratically legitimized and was created unilaterally by the Commission.