Streamlining of Compliance Regulations
Government Announces Streamlining of Compliance Regulations Post-Brexit, Benefiting Businesses
In a move aimed at easing regulatory burdens on businesses, the UK government has unveiled plans to streamline compliance regulations post-Brexit. The initiative, announced on May 24, 2023, by the Department for Business and Trade, seeks to alleviate the costly and time-consuming reporting requirements that have been a concern for many companies. By lightening the reporting load, the government aims to empower businesses to focus on growth and contribute to a more competitive and prosperous business landscape.
Call for Evidence and Simplification:
To achieve this goal, the government has initiated a call for evidence, inviting input from a wide range of UK companies, investors, and industry experts. The focus of this exercise is non-financial reporting regimes, which provide valuable information beyond financial figures. While such reporting is essential for investors, companies have expressed the need for simplification, particularly in light of the opportunities presented by Brexit. Lengthy annual reports, often spanning around 200 pages for large UK companies, have placed unnecessary burdens on businesses. The review seeks to:
Save time and reduce costs for businesses through a streamlined and targeted corporate reporting regime.
Ensure company annual reports contain clearer and more relevant information by engaging investors to determine what truly matters to them.
Enhance the UK's competitive advantage as a business destination by placing growth and investment at the core of reporting requirements.
Ministerial Support:
Business Minister Kevin Hollinrake emphasized the government's commitment to reducing red tape, stating, "We want to shred unnecessary paperwork so businesses can focus on what's important to them – growing and making profit." By capitalizing on the opportunities presented by Brexit, the government aims to make the UK a more business-friendly and competitive environment, while maintaining a strong focus on economic growth.
Size Thresholds and Micro-Enterprises:
As part of this regulatory review, the government will also reassess the size thresholds that dictate certain information requirements within annual reports, specifically the definition of micro-enterprises. Currently influenced by an EU directive, these thresholds may be placing undue burdens on small businesses. Re-evaluating these requirements will enable micro-enterprises to allocate their resources more effectively towards growth and job creation, rather than excessive reporting.
Next Steps and Legislation:
The call for evidence, which began on May 24, will remain open until August 16. The insights collected during this period will form the basis for developing detailed proposals for public consultation in the following year. Based on the feedback received, the government will consider appropriate legislative changes to implement the streamlined compliance regulations.
Supporting Economic Growth:
These efforts align with the "Smarter regulation to grow the economy" policy paper released on May 10, 2023. The government's commitment to reducing burdensome regulations and driving economic growth has been reinforced since the UK's departure from the European Union. This departure empowers the UK to tailor rules and processes to its unique circumstances and businesses, including non-financial reporting, while upholding robust workers' rights.
Welcome News:
The government's announcement regarding the streamlining of compliance regulations post-Brexit marks a significant step towards supporting business growth and reducing unnecessary reporting burdens. By seeking input from businesses, investors, and industry experts, the government aims to develop a more targeted and efficient corporate reporting regime. As the UK shapes its own regulatory landscape, the focus remains on fostering a competitive business environment while upholding transparency and accountability. The call for evidence presents an opportunity for stakeholders to contribute their expertise and help shape future regulatory frameworks that align with the needs of businesses in a post-Brexit era.
The original announcement can be found here: https://www.gov.uk/government/news/government-puts-business-first-with-brexit-regulation-shakeup
