A uniform 'small and medium-sized enterprises' (SME) definition was adopted under Recommendation 2003/361/EC throughout EU Member States. Such definition was later revised in 2005 establishing a variety of criteria depending on the turnover of the enterprise as well as the number of employees employed by the business. The definition describes three types of SMEs:
• Micro-enterprises which employ up to 10 persons;
• Small companies which employ up to 50 persons; and
• Medium-sized enterprises which employ up to 250 persons.
A consultation document will be issued in 2012 in order to revise such definition. Member States praised such an action so as to reduce any unnecessary burdens imposed on SMEs, particularly to further remove any excessive regulation on micro-enterprises. The Consultation has been received with different reactions where, on the one hand sceptics argue whether there really is a need of change; on the other hand others who favoured this approach welcomed the consultation document due to the disproportionate and cumbersome obligations which may be imposed on small businesses.
All aspects revolving around the definition of SME’s shall be debatable to the public and this will carry its effect directly onto spheres of legal and fiscal obligations. SME’s constitute 99% of businesses throughout the EU thereby carrying a substantial weight in relation to employment issues and other issues which are indirectly affected.
