The Spanish National Markets and Competition Commission (CNMC) has formally proposed a sweeping reform of the regulatory framework governing small and medium-sized enterprises (SMEs) to stimulate economic activity and innovation. This initiative follows a detailed study identifying significant barriers that currently stifle the growth of these businesses, which are the backbone of the Spanish economy. Representing over 99% of the national business fabric and generating 65% of total employment, SMEs are vital drivers of competition and private sector GDP. However, the CNMC warns that excessive bureaucratic burdens, regulatory fragmentation, and late payments continue to act as a drag on their productivity and market entry.
Central to the Commission’s recommendations is the need for a more integrated and pro-competitive market. The CNMC argues that current administrative complexities and the “regulatory step effect”—where a slight increase in company size triggers disproportionately heavy obligations—often discourage firms from expanding. To combat this, the proposed reforms advocate for a more gradual transition of regulatory requirements based on company size. Furthermore, the Commission emphasizes the importance of the “once-only” principle in administrative procedures, ensuring that businesses are not forced to submit the same documentation multiple times to different authorities.
A significant portion of the reform targets the public procurement sector, where SME participation remains notably low. The CNMC observes that complex tender designs and disproportionate requirements often exclude smaller players, which ultimately harms the public interest by reducing the variety and quality of bids available to the administration. To rectify this, the CNMC suggests that “the administrations must simplify public procurement procedures and encourage participation in tenders.” Key measures include the division of large contracts into smaller lots and the enhancement of the CIRCE system as a single point of contact for entrepreneurs.
Finally, the proposal addresses the persistent issue of commercial delinquency, which severely impacts the liquidity of smaller firms. The CNMC suggests implementing more aggressive measures against late payments, such as the potential for automatic interest payments and penalties for defaults. By streamlining licensing through “responsible declarations” and fostering innovation via regulatory sandboxes, the CNMC aims to transform the Spanish business environment into one that actively nurtures the growth of its 3 million SMEs rather than hindering them with red tape.