Small business threat

Date published: 29 November 2011

An "outrageous" move by the EU to force companies to hand over €25,000 before they can set up business has been criticised by local MEP Paul Nuttall.

"This proposal will have a devastating effect on the creation of small businesses, a sector which employs almost half the UK workforce.

"They are already over-regulated and small and medium businesses face enough financial problems, with the reluctance of banks to lend, without more totally unnecessary EU interference.

"It is an outrageous proposal and our government must block this when it reaches the Council of Ministers," said Mr Nuttall, UKIP Deputy Leader.

"We need to be stimulating new businesses, not stifling such enterprise. In this country 99.3% have between 0 and 49 employees and 37% of UK turnover is generated by small firms.

"Out of the 4.3 million businesses in Britain 2.72 million are sole proprietors. SME's employ 12 million people, which is 58% of the private sector workforce and turnover totals £2,400 billion - just over half the UK GDP.

"And more than 60% if all commercial innovations come from small businesses

"If I was not so used to EU madness and interference I would find this proposal, which follows a report authored by German MEP Klaus-Heiner Lehne, and passed by the European Parliament, unbelievable," said Mr Nuttall.

Text proposed by the Commission Article 6
1. The laws of the Member States shall require that, in order that a company may be incorporated or obtain authorisation to commence business, a minimum capital shall be subscribed the amount of which shall be not less than EUR 25 000. 

The report can be found here:
http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&reference=A7-2011-0348&language=EN