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What is an SME?

what is a turnover

"SME" stands for small and medium-sized enterprises – as defined in EU law: EU recommendation 2003/361 .

These ceilings apply to the figures for individual firms only. A firm which is part of larger grouping may need to include employee/turnover/balance sheet data from that grouping too.

For the details of how this works, see:

What help can SMEs get?

There are 2 broad types of potential benefit for a company if it meets the criteria:

  • eligibility for support under many EU business-support programmes targeted specifically at companies of this size: E.g. research funding, competitiveness and innovation funding and similar national support programmes that could otherwise be banned as unfair government support ("state aid" – see block exemption regulation ).
  • fewer requirements or reduced fees for EU administrative compliance.

Monitoring of the implementation of the SME definition

DG Enterprise and Industry carries out a regular monitoring of the implementation of the SME definition. Building on the results of evaluations performed in 2006 and 2009, an independent study was carried out in 2012, focussing on how the SME Definition works in practice in the implementation phase.

In its recommendations, the study suggested to clarify the application of certain rules within the existing Recommendation, for example by means of further guidance or by updating the current SME Definition User Guide. To this end, an evaluation of the user guide was carried out in 2013-2014. The conclusions and suggestions provided in the final report will be the basis for the revision of the user guide, which should be available in all EU languages by March 2015.

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