Call for Evidence Single Market Strategy 2025 Cooperatives Europe position

Cooperatives Europe is the European region of the International Cooperative Alliance, representing cooperative enterprises in the EU. This policy brief outlines their priorities and insights for the upcoming Single Market Strategy 2025, emphasizing the importance of integrating a small and medium-sized enterprise (SME) perspective while maintaining social cohesion within the market.

One of the key challenges highlighted is the lack of recognition of the cooperative business model across EU Member States. This inconsistency creates obstacles for cross-border operations of cooperative enterprises, as legal frameworks vary significantly. Most transnational cooperatives, which involve operations in multiple countries, are concentrated in a few nations such as Belgium, the Netherlands, Germany, Ireland, and Denmark, primarily in sectors like dairy and fruits & vegetables. The European Cooperative Society was introduced to facilitate these operations, but its complexity and the predominance of national laws have hindered its success.

Cooperatives Europe stresses the need for improved access to funding for cooperatives and other SMEs. Many of these enterprises struggle to obtain liquidity necessary for developing cross-border operations. The organization calls for reforms in public procurement rules to systematically include social clauses and reserved contracts for social economy entities. Tools like the Public Procurement Data Space could enhance access to tenders for SMEs but require greater promotion and awareness.

The brief welcomes the European Commission's efforts to simplify reporting and administrative burdens but emphasizes the importance of maintaining the "one in, one out principle" in regulatory adjustments. There is a call for the Commission to take into account existing platforms like the Fit for Future Platform, which aided in regulatory simplification. Reporting requirements often lead to double reporting and additional costs for cooperatives, which already face specific legal obligations. The Commission is urged to broaden its understanding of business models to include cooperatives equally.

The Omnibus package, aimed at rationalizing reporting requirements, presents an opportunity to embed Voluntary SME reporting standards within the Corporate Sustainability Reporting Directive (CSRD). This would help limit the data and questions large companies can impose on SMEs in their value chains. The clarity and timeliness of the Omnibus package are vital for reducing regulatory burdens and avoiding confusion among large enterprises already adjusting to existing rules.

The approach to economic growth as merely an increase in GDP, as suggested in a recent report by Draghi, is critiqued for overlooking crucial social factors such as wealth distribution and resource sustainability. Cooperatives Europe insists on maintaining social conditionalities in European economic policies, arguing that competitiveness should not come at the cost of social models. There is a call for a shift in EU priorities towards social and environmental goals.

To protect Europe's social model, the brief advocates for strengthening the social dimension within the European Semester. This should not just serve as an economic tool but also as a means for social policy reforms. The next multiannual financial framework (MFF) is seen as a strategic opportunity to advance EU objectives while ensuring the transformation of the Single Market is sustainable and equitable. Maintaining SME-specific funding within InvestEU and developing social impact investing are essential for supporting the European Pillar of Social Rights.