Today, December 12, the Committee of Permanent Representatives (Coreper 1) endorsed the political agreement with the European Parliament on two proposals for Regulations, the European Venture Capital Funds Regulation – EuVECA and the European Social Entrepreneurship Funds Regulation – EuSEF. The political agreement between the European Parliament and the Council was reached on December 6. The Regulations are among the key actions of the so called twelve levers of the Single Market Act aimed at boosting growth and strengthen citizens' confidence in the EU Single Market.
The two Regulations are expected to contribute to growth, competitiveness and social progress in Europe, by considerably enhancing access to capital by innovative small and medium sized enterprises (SMEs) and social businesses, especially in the context of the current economic crisis. The Regulations will establish two new labels for European funds, EuVECA and EuSEF. Funds with total assets under management below €500 million, satisfying a uniform set of rules for each label, will be able to raise capital throughout the European Union for the benefit of start-ups and social businesses.
Easier to identify funds
Moreover, the use of these quality labels will make it easier for investors to identify funds which will be financing businesses that address social objectives as their corporate aim, as well as funds that commit to finance innovative SMEs. The specific requirements for each label will also guarantee a uniform standard and ensure that investors get clear and effective information on these investments.
Substantial work examining the two Proposals had been undertaken during the Danish Presidency. However an agreement between the two co-legislators the European Parliament and the Council of the European Union was not reached, due to an outstanding issue regarding third country eligibility for the use of the new designations.
Through the systematic efforts of the Cyprus Presidency, the spirit of compromise of the two co-legislators as well as the facilitating work of the Commission and Commissioner Barnier, the deadlock has been lifted. On December 6 the Council and the European Parliament reached a provisional agreement, which has been confirmed by Coreper.
For the Regulations to enter into force, the formal approval by the Council and the European Parliament is still needed. It is expected that the decision by the Council will follow the plenary vote in the European Parliament in early 2013.