A top EU body tasked with reducing regulatory burdens on business has today backed a Conservative agenda to exempt smaller businesses from a raft of EU laws.

Proposals that were initially put forward by Conservative MEP and Legal Affairs spokesman Sajjad Karim have been supported in a report published by Edmund Stoiber, the former Bavarian Prime Minister who chairs the EU's expert group on slashing red tape.

The report, launched this morning by outgoing Commission President Barroso, says that small businesses can save over £32 billion per year if regulatory burdens can be reduced. It also supports Conservative calls for more rigorous impact assessments to be carried out on legislation, and for national governments to be discouraged from 'gold plating' EU legislation to make it more burdensome than intended.

Sajjad Karim has drafted several reports for the European Parliament on how EU law can reduce the burden on businesses – and especially entrepreneurs. His report first set out the principle that the smallest businesses should be exempt from EU legislation unless there is a strong argument for their inclusion. He has also called for a 'one in, one out' approach to law so any new proposal is offset.

Dr Karim, who represents the North West of England, said: "Cutting red tape is an agenda that the commission is taking seriously. There is a long way to go but it is clear that we are making progress in ensuring that full consideration is given to the impact that EU law can have on businesses.

"EU law is often pro big business, but anti market, because it shuts out the little guy and favours the multinational corporations that have the luxury of compliance teams and banks of lawyers.

"We want entrepreneurs to devote their time to growing their businesses, taking on new staff and growing the economy. Every minute they are forced to consult a lawyer or an accountant amounts to lost productivity in the economy.

"Jean Claude Juncker's Commission must take this agenda forward in the next five years. With his Vice-President Timmermans in charge I believe we will see a real effort in the coming years to reduce the burden on business and to ensure that EU law is only in place when absolutely necessary."

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