EU Cuts Red Tape: How Ending Gold-Plating Boosts SME Competitiveness in 2026

Brussels, Belgium, Source:

The European Commission has launched a decisive campaign to eliminate "gold-plating," a practice where member states add unnecessary regulatory layers beyond EU requirements. This initiative follows President von der Leyen’s 2026 State of the Union Address, which highlighted regulatory simplification as essential for economic health.

Gold-plating occurs when national governments impose stricter rules during the transposition of EU directives. While aimed at enhancing local standards, this often creates uneven playing fields. It distorts competition and fragments the internal market, placing disproportionate burdens on small and medium-sized enterprises (SMEs).

Large corporations can absorb complex compliance costs, but SMEs often find these additional requirements prohibitive. This discourages cross-border activity and undermines overall competitiveness. The goal is to ensure fairness for businesses of all sizes while restoring confidence in the Single Market.

Vice-President Dombrovskis noted that while unlawful gold-plating can be addressed through legal enforcement, much of the issue stems from national policy choices. These choices are technically compliant with EU law yet still harm the Single Market. The Commission is therefore pursuing a three-pronged strategy focused on detection, follow-up, and proactive prevention.

Detection efforts will leverage stakeholder consultations, implementation dialogues, and investigations under the Single Market focus areas. Follow-up mechanisms will utilize the European Semester process and the Single Market Enforcement Taskforce to identify and address barriers systematically.

To support member states, the Commission is developing a toolkit featuring best practices for detecting and preventing gold-plating. A recent questionnaire circulated among member states aims to gather data on national approaches, while parallel surveys engage stakeholders.

The Commission is also refining its legislative drafting techniques to minimize future risks. This includes prioritizing regulations over directives where appropriate to reduce ambiguity. This approach aligns with the broader "One Europe, One Market" roadmap and responds to calls from the European Council to eliminate disproportionate national requirements.

By striking a balance between subsidiarity and efficient governance, the EU aims to cut red tape. This initiative ensures fairness for businesses and restores confidence in the Single Market’s ability to drive growth and innovation in an increasingly competitive global economy.