Maltese Presidency secures rules for better investment in start-ups and innovation

Today, 30 May 2017, the Maltese Presidency of the Council of the EU secured an agreement with the European Parliament which will lead to a significant boost in financing for SMEs and entrepreneurs.

​The agreement is part of the EU's plan to develop a fully functioning Capital Markets Union, diversifying funding sources for Europe's businesses and long-term projects. It is also linked to the EU's investment plan for Europe.

The Maltese Presidency has been a staunch proponent of completing the EU’s Capital Markets Union from the outset of its semester, particularly those aspects which support SMEs and lead to more and improved employment opportunities for citizens.

Welcoming the agreement, Edward Scicluna, Malta’s Minister for Finance, stated: "If European SMEs are to grow and develop, it is indispensable that financing – both bank and capital market financing – is readily available. This regulation will help stimulate market financing and thereby boost economic growth."

The EU has been falling behind the United States in this sector. According to the European Commission, an extra €90 billion would have been available between 2009 and 2014 for financing European companies if venture capital markets had been as developed as in the US.

The agreement secured by the Maltese Presidency adjusts rules adopted in 2013 to encourage investment in European venture capital funds (EuVECA) and European social entrepreneurship funds (EuSEF). Once the agreement is confirmed, the funds will be available to fund managers of all sizes and the range of companies that the funds can invest in will be expanded – including to SMEs. It also makes the cross-border marketing of such funds cheaper and easier.

The Maltese Presidency will submit the agreement to EU Ambassadors in the coming days for endorsement on behalf of the Council. The European Parliament and the Council will then be called on to adopt the regulation without further discussion.