Economic uncertainty drives entrepreneurial activity; that’s not a new phenomenon. What's novel right now is the on-ramp: digital tools have nearly eliminated the barriers to starting a business. A person with an idea and a smartphone can launch a store, reach customers across the globe, and compete with retailers a hundred times their size, in an afternoon.
But while the tools to start a business are increasingly accessible, Europe’s regulatory environment has never been more complex. And that complexity falls hardest on those who can least afford it: small businesses and first-time founders.
Consider an entrepreneur trying to expand into another EU country. 75% of companies need lawyers to do this, costing €10,000 to €15,000 per market to understand local privacy and data rules. Then there’s GDPR compliance, which cuts SME profits by 8.5-12%. That’s far more than for large businesses (7.9%) that can absorb the cost. And there are other compliance decisions: should they run a Data Protection Impact Assessment (DPIA), a process costing anywhere from €14,000 to €149,000?
A person with an idea and a smartphone can launch a store, reach customers across the globe, and compete with retailers a hundred times their size, in an afternoon
And then there’s cookies. Europeans collectively spend 575 million hours a year managing cookie banners, and the fatigue hurts entrepreneurs disproportionately. A German-based merchant told us they lose roughly 10% of potential customers the moment the cookie banner appears. For a small business, that's not a minor UX annoyance—it's lost revenue. And compliance isn't straightforward either. Cookie consent is rooted in EU law, but real-world expectations and enforcement vary by member state. A setup that's perfectly acceptable in one country can be challenged in another.
This system isn’t working for anyone. These policies close doors on entrepreneurs before they've had the chance to knock.
We support two initiatives that offer a real chance to fix this. First, the Digital Omnibus, the Commission's proposal to streamline overlapping digital regulations. As proposed, the omnibus would harmonise DPIA rules across member states, simplify breach reporting, and grant more reasonable timelines. The omnibus could also simplify cookie consent—but only if lawmakers go further than the original proposal, like exempting low-risk cookies from burdensome requirements.
Simplification is the difference between ideas that stay on paper and businesses that thrive
Secondly, the proposed "28th regime" would create a single, unified alternative to the 27 existing national legal systems. Instead of navigating different company laws in every member state, founders could operate under one legal structure recognized across the EU. The first building block is EU Inc., a newly announced company type that lets founders incorporate fully online, in 48 hours, for under €100, with no notarization or physical presence required. For entrepreneurs, this cuts admin toil but more importantly, it removes the fear of a costly legal misstep.
This kind of structural reform is a good start. But it’s only a start. We need even more ambitious policies that bolster entrepreneurs and give more incentives to build a business in Europe. With bold changes, policy can stop being the reason someone didn’t take the leap.
Simplification is the difference between ideas that stay on paper and businesses that thrive. The surge in entrepreneurship is already happening. The question is whether European policy will harness the momentum, or stand in its way.
The tools are ready; the ambition is there. It’s time for the rules to catch up.
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