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Business Legislation

The goal of Suomen Yrittäjät is the development of law to better correspond to the needs of small and medium-sized enterprises (SMEs). Suomen Yrittäjät works to ensure that the principles of good regulation are observed in practice. 

 

The cost of regulation to enterprises should be reduced by 25% from the current level by 2025. Seventy percent of entrepreneurs feel that the regulatory burden has grown over the years, while 68% feel that the government’s deregulation measures have been inadequate (summer 2017). Two-thirds would employ more people if SMEs were subject to fewer regulations (Entrepreneurship Barometer 1/2018). The willingness to hire is a particular concern of businesses that already have employees. To reach this goal, legislators must be given effective tools: the one-in, one-out tool should be quickly extended to be available in the law drafting measures of various ministries, and the SME test should also be implemented in Finland.

We need a more ambitious goal in the next parliamentary term to reduce the cost of regulation to enterprises. We must adopt a one-in, two-out approach: If new regulatory measures result in an additional obligation of €1 to businesses, the cost of regulation to enterprises should in turn be reduced by €2. The SME test should be included in the national impact assessment of all drafting of national legislation and EU projects. Micro-enterprises should be excluded from the regulatory measures if the impact assessment gives good cause to do so. 

The impact of EU regulation on entrepreneurship must be widely acknowledged, and resources to the official lobbying of Finland must be increased. EU regulation has a significant impact on both businesses operating only domestically (more than 50% of the regulation aimed at businesses stems from EU legislation) and ones that have expanded elsewhere in the internal market (roughly 25% of enterprises directly use the internal market). Paying attention solely to the drafting or quality of domestic regulation is inadequate from a business perspective. Finland’s official EU lobbying efforts are currently not professional or consistent in all respects. The situation can be addressed through guidance from the government and by increasing or better allocating ministries’ skills and resources. 

Minimum capital requirement for limited liability companies must be removed. Removal of the minimum capital requirement for limited liability companies would release almost €700 million, on conservative estimates, for businesses’ other needs. The current minimum capital requirement and the related administrative requirements restrict the establishment of enterprises, particularly in the service sector. This long-term goal of Suomen Yrittäjät is becoming a reality in this Parliament. 

Micro-enterprises must be exempt from the audit obligation. All EU member states, except Malta, have higher audit limits than Finland. If micro-enterprises were exempt from the audit obligation, about 30,000 enterprises would be subject to the audit obligation. This goal of Suomen Yrittäjät is becoming a reality in this Parliament. Enterprises that still see auditing as necessary could in future appoint an auditor, even though this would not be required by law. 

Maximum amounts needed for corporate debt collection charges. The Debt Collection Act should be amended to set maximum amounts for the collection charges of corporate debts. The collection charges should be reasonable with respect to the debt amount. Such an amendment would save businesses money and clarify their legal position. Clear rules would also guarantee the creditor’s judicial protection.

Entrepreneurs must be allowed to start fresh, and obstacles to entrepreneurship must be cleared. Establishing a company in Finland is, in principle, fast and easy. If an entrepreneur has previously failed in entrepreneurship or a business that could keep trading is temporarily insolvent or in danger of becoming insolvent, our legislation and systems pose multiple obstacles to starting a new company or continuing to trade profitably. Removing or lowering these obstacles would allow us to retain jobs and find new employment for entrepreneurs, and save society money. These obstacles must be comprehensively surveyed and cleared during the next parliamentary term.

Consumer law regulation must be well-balanced from the perspective of self-employed people. Legislation to protect the rights of consumers is being drafted at both the EU and Finnish levels. The plans involve expanding authorities’ powers, making sanction systems more stringent, widening access to class actions, and harmonization of regulation on liability for error. The new regulatory measures should not lead to smaller enterprises being unable to operate in the consumer market due to an excessive burden.

Contracts between businesses must balance rights and responsibilities well. A small business does not always have the opportunity to negotiate with a larger contracting partner (a publicly owned body or large company) on the terms and conditions of a contract and, as a result, such things as payment terms may be unfair. The law should guarantee that the terms and conditions are reasonable for all parties.

Scams targeting businesses must be brought under control. For this purpose, a general picture of the frauds that enterprises are subject to should be formed and the legislation re-assessed. Scams targeting enterprises and criminal fraud have significantly increased in the 21st century (other crimes against property have decreased). Two-thirds of self-employed people without employees have been a target of a scam at least once during the year. Directory service scams alone cost businesses more than €20 million a year.

Environmental laws must enable profitable business, new investments and reasonably-priced construction. Unnecessary permits must be scrapped, and post-control must replace advance control. Permits and land use solutions must be granted within a reasonable, foreseeable time. A one-stop-shop approach must be applied in which a business can receive all the required permits and solutions to implement its project from a single place. 

Suomen Yrittäjät has had an influence on the following: 

Rationalization of regulation. One of the top projects of the current parliamentary term is the rationalization of regulation in the way that Suomen Yrittäjät has hoped. Each ministry has examined redundant provisions in its industry and aimed to remove them. The Ministry of Economic Affairs and Employment has adopted the one-in, one-out tool, which allows businesses to estimate and reduce the cost of regulation. A Regulatory Policy Council has been set up to draw attention to the quality of regulation.

Debt Collection Act. At the initiative of Suomen Yrittäjät, the Debt Collection Act was amended so an entrepreneur may lodge an objection against inappropriate debt collection measures resulting from such things as scam contracts. The rules for draft collection have also been clarified so that only clear, undisputed debts may be collected using a draft. An entrepreneur may not obtain a bad credit record due to scam invoices.

Act on Limitations. In 2015, the Act on Limitations was amended so that a debt based on a contract will expire definitively after 20 years of it falling due. If the creditor is a natural person, the period of limitation is 25 years. Previously, the law did not include a provision on the definitive expiration of a debt in a situation where the creditor has not applied for grounds for execution concerning the debt. The current Act on Limitations shall be applied retroactively, meaning the oldest debts will expire definitively no sooner than on 1 January 2020.

Enforcement Code. In 2018, the Enforcement Code for debts was amended, at the initiative of Suomen Yrittäjät, so that an indebted person who has been unemployed for a long time who becomes an entrepreneur can obtain free months or relief amounting to the protection portion during recovery proceedings. 

Debt adjustment of an entrepreneur. Since the beginning of 2015, entrepreneurs have been able to seek debt adjustment. The private and business-related debts of a severely indebted entrepreneur with a business name can be restructured, and profitable business operations may continue. The change was the result of an initiative proposed by Suomen Yrittäjät.

Business prohibition. The law has been amended so that an entrepreneur may no longer be disqualified from engaging in business activities because the business’s public payments are unpaid due to insolvency.

Shopping hours. At the initiative of Suomen Yrittäjät, a reform was implemented in 2014 granting small entrepreneurs in shopping centres the right to keep their shops closed on one day a week of their choice. This provision, enacted to protect the business-owner, also remained in force when all opening hour restrictions were removed during the current parliamentary term.

Environmental proceedings. For a long time, Suomen Yrittäjät has spoken in favour of cutting the red tape around environmental permits. At the government’s proposal, environmental proceedings have been streamlined by removing some environmental permit requirements, for example. In addition, the threshold for a permit requirement has been raised in some operations and registration procedures adopted instead. 

One-stop-shop bill. Finland now has a law that will, when in force, allow businesses to apply for environmental permits using the one-stop-shop principle. A business can approach a single authority through an electronic system, regardless of its location, the number of required permits and the licensing authorities. Various report and hearing proceedings will also be removed, and the process will become more entrepreneur-friendly.

Waste management industry. The Waste Act has been amended to shift waste management tasks from municipal bodies to the free market. In addition, an electronic marketplace will be set up to enable genuine competition in the industry. The change will not only benefit private waste management enterprises, but also other enterprises producing waste. As competition increases, the expectation is that services will improve and the prices will be determined by the market. 

Misleading marketing and identity thefts. Suomen Yrittäjät has joined forces with the police and other controlling authorities to eradicate inappropriate behaviour more effectively.