Inefficient scrutiny of EU regulations hurting UK firms

The lack of a proper relationship between the UK’s regulatory system and that of the EU is compromising the competitiveness of British businesses, it has been claimed.

According to a report published by the British Chambers of Commerce (BCC), there is little effective communication between the two, allowing too many new rules to be imposed on UK firms.

Tim Ambler, Senior Fellow at London Business School, and Francis Chittenden, Professor at Manchester Business School, who wrote the report, reviewed almost 250 Impact Assessments (IAs) of EU laws.

They found that the UK’s formal scrutiny of proposed European laws comes far too late to amend or change the regulations before they are implemented.

The authors argued that the UK’s 12 EU Parliamentary Scrutiny committees process a mass of paper unconnected from the UK’s IA system, which should cover the same ground.

The report concluded that it is vital the UK’s IA process should be synchronised with the EU’s. Disjointed as the current system is, UK companies are faced consequently with substantial and damaging costs.

David Frost, the BCC’s director general, commented: “If we are to see a better regulatory environment for business then the government must engage earlier in the EU’s policymaking process. This report highlights the fact that the government is only focused on the UK end of EU legislation. There must be a clear link between events in Brussels and the UK’s own consultation process.

“The cumulative cost of new regulation to business since 1998 is now £76 billion – some £53 billion of this is EU sourced. Without timely engagement and substantive consultation, the UK’s ability to influence EU policy to the benefit of British business, and also the EU as a whole, is severely limited.”