On 22 June, the European Commission published a new Recommendation to the Member States to facilitate the transfer of ownership of small and medium-sized enterprises (SMEs). The Recommendation addresses a pressing demographic challenge: many small business owners across the EU are nearing retirement without a designated successor.  

This has the potential to impact millions of companies over the next decade. Where a business transfer fails, jobs, know-how and economic value may be lost.  

The Recommendation builds on the previous Recommendation on business transfers from 1994. While maintaining many of its core principles, the updated Recommendation places greater emphasis on awareness-raising, legal and tax measures, digital matchmaking platforms for buyers and sellers, and coordinated EU-level cooperation to preserve business continuity and jobs within the EU. 

For example, it encourages Member States to reduce administrative, legal and tax barriers to cross-border business transfers, helping businesses make full use of the opportunities offered by the Single Market. It also recommends developing dedicated financing and training programmes to broaden the pool of potential successors and entrepreneurs, including women and other under-represented groups in entrepreneurship.  

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