Single Market Dossier
Summary
2.2. The Letta Report: Proposals for SMEs and European Growth
The European Single Market is undergoing a phase of profound change, driven by three main factors: geopolitical instability, the green and digital transitions, and increasingly intense global competition. In this context, the Letta Report, published in April 2024 at the request of the European Council and the Commission, outlines an operational agenda to overcome fragmentations and constraints that hinder growth, innovation, and economic security.
The Letta Report stems from the need to overcome the barriers that still hinder the full functioning of the European Single Market. Despite the progress made, strategic sectors such as finance, energy, electronic communications, and health continue to present strong elements of fragmentation, with a direct impact on the Union's competitiveness.
Financial Sector
The fragmentation of markets prevents the European Union from fully exploiting €33 trillion of private savings, much of which remains inactive in current accounts or is invested abroad, especially in the United States, instead of supporting European growth. To reverse this trend, the Letta Report proposes the creation of a Savings and Investments Union, an evolution of the Capital Markets Union, with the aim of channelling a significant portion of these savings towards productive investments within the EU.
Among the most innovative measures is the introduction of a European long-term savings product, with automatic enrolment, designed to incentivize citizen participation and direct resources towards the real economy. This is accompanied by the reform of ELTIFs (European Long-Term Investment Funds), which should become more attractive thanks to a revision of their functioning and national tax incentives. Finally, the idea of a European safe asset, a common safe security issued by the EU, inspired by the positive experience of NextGenerationEU, is relaunched to offer investors a stable benchmark.
Energy Sector
After the crises of 2022 and 2023, the need for planning on a European scale emerges, with an increase in the budget of the Connecting Europe Facility - Energy and simpler procedures for accessing funds. To further simplify, the creation of a Clean Energy Delivery Agency is proposed, a one-stop shop responsible for coordinating programs, incentives, and authorizations, reducing the bureaucracy that currently hinders businesses and administrations.
Defence Sector
The issue of defence is addressed with proposals that aim to build more stable and innovative supply chains. Among these, the creation of a Defence Support Line through the European Stability Mechanism and the issuance of Eurobonds for defence, with the involvement of the EIB to co-finance strategic industrial technologies and capacities. The goal is to guarantee predictable demand, stimulate research, and favour both civil and military applications.
Electronic Communications
The Report emphasizes the urgency of overcoming the current fragmentation, moving from 27 national markets to a true single market. This requires the harmonization of rules, cross-border consolidation of operators, and coordinated management of the radio spectrum. An update of the rules on net neutrality is also proposed, considering the new needs related to 5G and edge cloud. The objective is to create operators with European scale, capable of offering more efficient connectivity, advanced digital services, and lower costs for businesses and citizens.
Health Sector
The Report proposes to strengthen internal production of active ingredients and essential medicines, simplify multi-country clinical trials, and expand joint procurement beyond vaccines. The creation of a European guarantee fund for innovative medicines and the implementation of the European Health Data Space are suggested, to make national systems interoperable and favour research and planning.
One of the main obstacles for European businesses is gold plating, i.e., the addition of national constraints to EU directives, which makes rules more burdensome and uneven, penalizing the Single Market. To overcome this, the Letta Report proposes to relaunch the Delors method, based on harmonization of essential rules and mutual recognition for procedural aspects.
Alongside this, it introduces the idea of a European Business Code ("28th regime"), an optional, uniform, and simplified legal framework, especially useful for SMEs to reduce costs and uncertainties and favour access to EU markets.
Another pillar is the digitalization of procedures through tools such as the Single Digital Gateway and the Digital Identity Wallet, to reduce bureaucracy and duplications, guaranteeing the "once only" principle in data management.
Finally, the Letta Report proposes a further conceptual innovation: the introduction of a Fifth Freedom, to be added to the four fundamental freedoms that have always constituted the heart of the European Single Market: the free movement of goods, people, services, and capital. This new freedom would be dedicated to research, innovation, data, skills, and education, with the aim of integrating the factors of knowledge into the core of the European project.
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2.1. EU Strategy for the Single Market: Objectives and Challenges
Il Mercato Unico è il pilastro dell’economia europea, ma oggi non sfrutta tutto il suo potenziale. Persistono barriere regolatorie, frammentazione dei servizi e procedure complesse che rallentano imprese e PMI. La nuova strategia della Commissione mira a rimuovere questi ostacoli, digitalizzare i processi e rafforzare, creando uno spazio economico più integrato, competitivo e adatto alle sfide globali.
The Single Market has been one of the main drivers of European integration for over thirty years. It has fostered economic growth, job creation, and new opportunities for businesses and citizens. According to estimates, it has contributed to a 3.4% increase in the EU's GDP and the creation of more than 3.6 million jobs.
Today, the international context has profoundly changed: geopolitical instability, the green and digital transitions, and increasingly intense global competition pose new challenges. In this scenario, a Single Market that is not fully functional risks becoming an obstacle rather than an advantage for European competitiveness.
To address these challenges, the European Union has initiated a strategic review, culminating in the new strategy for the Single Market presented in May 2025. This strategy, articulated in nine areas of intervention, focuses on three main problems:
Persistent barriers to free movement
The so-called "Terrible Ten" are ten practical obstacles that limit the circulation of goods, services, people, and capital. Among these: outdated product rules, delays in defining technical standards, fragmentation of laws between countries, difficulties in the recognition of professional qualifications, territorial restrictions in retail trade, and complex procedures for the temporary posting of workers. These barriers increase costs, especially for small and medium-sized enterprises (SMEs), and reduce the effectiveness of the Single Market.
Uneven application of common rules
In many cases, European rules are not applied uniformly in the different Member States. This creates legal uncertainty and hinders mutual trust between businesses and national authorities.
Lack of effective governance tools
To avoid new fragmentations, the European Commission proposes an annual strategy to improve the application of common rules, the appointment in each Member State of a national contact point for the Single Market, and, if necessary, the adoption of a specific law to prevent new barriers. These tools aim to strengthen the management of the Single Market and ensure that rules are respected consistently across the Union.
This vision is part of a broader design, which aims to transform the Single Market into a true strategic infrastructure for Europe's growth, resilience, and technological leadership. The initiatives in the field, from regulatory simplification to digitalization, from support for investment to strengthened governance, are not isolated interventions, but pieces of a single integrated vision.
In this framework, the Letta Report and the Draghi Report represent two complementary perspectives of the same ambition. Letta looks "inside" the Single Market, proposing to remove barriers, harmonize rules, and introduce tools like the Fifth Freedom and the 28th regime to simplify business life. Draghi, on the other hand, looks "outward," focusing on Europe's ability to compete globally, with more flexible industrial policies, massive investments, and strong support for strategic sectors.
2.3. The Draghi Report: Competitiveness and Technological Sovereignty
The Draghi Report, published in 2024, proposes rethinking the Single Market as a strategic infrastructure to regain competitiveness compared to the United States and China. Its priorities are regulatory simplification, investment incentives, and support for key sectors for technological sovereignty. The objective is to create a more predictable and integrated context, capable of attracting capital and fostering innovation.
The report's objective is to regain competitiveness in a global context: over the last ten years, European GDP per capita has increased by 6%, compared to 15% in the USA, while private investments in research and development are about 40% lower than American ones.
Draghi identifies three fundamental lines of action to strengthen European competitiveness.
1. Simplification and regulatory predictability
Today, businesses face fragmented rules and slow procedures, which represent an obstacle to growth. For example, opening a branch in another Member State can take up to three or four times longer than in the United States. To overcome these difficulties, the Report proposes to harmonize rules and reduce tax and authorization differences, introduce faster procedures with one-stop shops for businesses, and guarantee a stable regulatory framework, to reduce uncertainty and facilitate investment planning.
2. Industrial policy and flexible competition
According to Draghi, State aid rules must become more adaptable to allow targeted interventions in strategic sectors, without however compromising competition. This means greater flexibility for projects of European scale, temporary tools to support investments in critical technologies, and clear criteria for public interventions, to avoid market distortions.
3. Priority sectors for technological sovereignty
The Report emphasizes the need to concentrate public and private resources in some crucial areas. In the digital field, the focus is on artificial intelligence, cloud, and semiconductors; in energy, on technologies for decarbonization; in defence and space, on the development of industrial capacities and resilient supply chains; while in the pharmaceutical sector, on the production of active ingredients and biotech innovation. To support these sectors, Draghi proposes dedicated financial instruments, such as guarantees, mission-oriented funds, and public-private partnerships, as well as more integrated capital markets, capable of favouring cross-border mergers and aggregations.
For SMEs, these measures can translate into concrete advantages: easier access to capital and incentives, faster times for authorizations and procedures, reduced costs of entering European markets, and the possibility of participating in strategic industrial supply chains. However, the Report warns that these benefits are not automatic: it is necessary to design accessible tools, with one-stop shops, common standards, and training and technical assistance programs to bridge the gaps in skills and managerial capacities.
In summary, the Draghi Report aims for a simpler, more integrated, and growth-oriented Single Market, capable of supporting European competitiveness and offering new opportunities for businesses. For Chambers of Commerce and SMEs, this means a more predictable, less fragmented context with greater possibilities for funding and internationalization.
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4. Resilience and Governance of the Single Market
The European Single Market is a mechanism that must be able to react to crises, technological transformations, and new economic needs. Resilience is built through more modern rules, advanced monitoring methods, and the strategic use of data. European governance combines regulatory innovation, digitalization, and economic analysis to guarantee transparency, fair competition, and evidence-based decisions. The resilience of the Single Market is based on regulatory and digital channels such as product passports and electronic CE marking, which strengthen transparency and safety. The European Commission uses innovative models like FIDELIO and comparative indicators to assess the impact of policies and guide strategic choices. Digital platforms and initiatives such as the Single Digital Gateway or the European Chips Survey complete a governance framework that integrates monitoring, digitalization, and fair competition.
In recent years, the Single Market has faced profound transformations, which have made it necessary to strengthen its resilience and update its governance mechanisms. The European Union has introduced innovative regulatory tools, such as digital product passports and electronic CE marking, which allow real-time verification of compliance with safety, health, and environmental protection standards. These solutions increase transparency, reduce counterfeiting, and facilitate refurbishment and recycling, benefiting the circular economy. Standardization continues to play a decisive role: aligning European standards with international ones Favors the competitiveness of businesses, especially in emerging and sustainable sectors.
In parallel, the European Commission has built an advanced system of economic and industrial monitoring, which combines predictive models and comparative indicators. Among these, FIDELIO, developed by the Joint Research Centre, stands out - a multi-sector model capable of estimating the impact of European policies on the economy and the environment, taking into account variables such as customs duties, state aid, or supply chain disruptions. Recently, the model has been updated to include a specific perspective on small and medium-sized enterprises, to better represent their needs and vulnerabilities.
Innovation indicators such as the European Innovation Scoreboard and the Regional Innovation Scoreboard allow for comparing the performance of national and regional systems, highlighting their strengths and margins for improvement. Furthermore, digital platforms such as the EU Open Data Portal or Tenders Electronic Daily guarantee transparent access to economic information and tender notices, offering businesses, particularly SMEs, useful tools to monitor markets and seize new opportunities. For economic operators, the ability to read and use this data represents a real competitive advantage.
The governance of the Single Market is also strengthened through the digitalization of procedures. The Single Digital Gateway facilitates the cross-border operation of businesses, while surveys like the European Chips Survey contribute to mapping the demand for semiconductors and identifying vulnerabilities in the supply chains of critical technological sectors. In this way, the EU pursues the objective of greater technological sovereignty and more solid industrial resilience.
Overall, the resilience of the Single Market is therefore based on an integrated system of rules, monitoring tools, and digital processes that support its evolution. For businesses and Chambers of Commerce, this ecosystem represents not only a regulatory context to respect, but a strategic resource to guide choices, plan for the future, and participate as protagonists in the European industrial transformation.
2.4. 28th Regime: Simplified Rules for Cross-Border Expansion
The 28th regime proposes an optional legal framework that allows businesses to operate throughout the EU under unique and harmonized rules. It aims to reduce administrative burdens and compliance costs, facilitating cross-border expansion thanks to common digital procedures, such as setting up a business in 48 hours.
The debate on the future of the European Single Market has brought back to the centre the proposal of the so-called "28th regime", already presented in the Commission's Competitiveness Compass and now relaunched in the new Single Market Strategy. The idea is to create an optional legal framework, designed to overcome the regulatory and administrative barriers that still fragment the internal market into 27 national systems. For SMEs and start-ups, this would be a change of great importance: the possibility to operate throughout the Union under a single set of simple and harmonized rules.
The 28th regime would not replace national regulations, but would offer a voluntary alternative to those who wish to grow beyond their own country's borders. A company could adopt it at the time of incorporation or at a later stage, thus benefiting from uniform procedures and centralized supervision, entrusted to ESMA in collaboration with national authorities. The objective is to reduce compliance costs, simplify cross-border expansion, and favour the birth of pan-European products and services.
The 28th regime aims to offer a simpler and more predictable regulatory framework, capable of breaking down operational barriers and making expansion abroad more accessible. The proposal is part of a broader strategy, which also includes the digitalization of administrative procedures, the introduction of a digital product passport, the standardization of labelling, and the possibility of setting up a company in just 48 hours via a common platform. Seemingly technical interventions, but which respond to very concrete needs of businesses and can significantly impact operational times and costs.
The optional nature of the regime could create a two-speed market, with some countries ready to adopt it and others more cautious. Centralized supervision and differences between national legal traditions could also encounter political resistance. For this reason, the Commission envisages constant monitoring and, if necessary, the introduction by 2027 of a Single Market Barriers Prevention Act, with the aim of preventing new fragmentations.
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2.5. New 2025 Single Market Strategy: Key Measures
The strategy, presented in May 2025, aims to relaunch European economic integration through nine pillars that include regulatory simplification, digitalization, and support for SMEs. Among the main measures are the SME ID, the digital product passport, and a plan to eliminate the most harmful barriers, with the objective of making the market more competitive and accessible.
The new Single Market Strategy, presented by the European Commission on May 21, 2025, marks a decisive step to relaunch and modernize the Union's main economic engine. The strategy identifies nine areas of intervention with priorities that closely affect businesses: eliminating the most harmful barriers, simplifying the regulatory framework, supporting SMEs, accelerating digitalization, and guaranteeing fair competition. A specific objective is the removal of the Terrible Ten; to overcome these brakes, the Commission proposes concrete solutions such as the digital product passport, the adoption of common specifications when harmonized standards are missing, and the creation of a single platform for worker posting declarations.
SMEs and mid-cap companies occupy a central position in the new agenda. Among the most relevant initiatives are the SME ID, which will simplify access to services in all EU languages, the SME Check, which will assess the impact of new rules on smaller businesses, and the new category of Small Mid-Caps (SMC), to extend support tools also to companies in the growth phase. Great space is also dedicated to digitalization: from the full operability of the Single Digital Gateway to the extension of the digital product passport, to the digitalization of public procurement, with the aim of reducing times and costs and making procedures "digital by default".
Finally, the Commission aims to ensure more effective application of common rules. An annual enforcement strategy, the appointment in each state of a "Single Market Sherpa", and, in case of new critical issues, the adoption of a Barriers Prevention Act are planned. The strategy offers European businesses, particularly SMEs, concrete tools to operate in a simpler, more integrated, and competitive context. The role of Chambers of Commerce will be fundamental to accompany companies in understanding and using the new opportunities, thus strengthening Europe's capacity to grow and innovate.
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2.6. Omnibus Package: Regulatory Simplification and Sustainability
Within the framework of the new European strategic agenda outlined by the von der Leyen Commission for the period 2024-2029, sustainability and competitiveness have been placed at the centre of political action. In this context, the Competitiveness Compass, presented on January 29, 2025 and inspired by the Draghi Report, traced the directions for strengthening Europe's capacity to innovate, invest, and grow sustainably.
It is precisely within this framework that the Omnibus Package, presented by the Commission on February 26, 2025, fits in. It is a complex legislative proposal divided into two packages of regulatory amendments, with the objective of simplifying and rationalizing the application of some of the main European directives on sustainability. The intent is twofold: on the one hand, to lighten the compliance burden for businesses, particularly SMEs and companies with limited resources; on the other hand, to maintain the high environmental and social ambition of the Union.
These proposals, while responding to requests for simplification and proportionality, on the other hand raise questions about the resilience of ESG commitments and the coherence of the European regulatory framework. In particular, many companies that had already started the adaptation process now find themselves in a phase of uncertainty, between obligations already in force and amendments still under discussion.
The Omnibus Package therefore represents a crucial step in the construction of a simpler, more coherent, and accessible European regulatory framework, but also a test for the Union's ability to reconcile environmental ambition and economic sustainability in an increasingly complex global context.
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3. Opportunities for Businesses and Citizens in the European Single Market
The European Single Market represents a strategic lever for the growth of Italian businesses, particularly SMEs. Through directives on public procurement, programs such as the Single Market Programme, Horizon Europe, and InvestEU, and initiatives for regulatory and digital simplification, the EU promotes competitiveness, innovation, and sustainability. Citizens also benefit from rights, mobility, product safety, and new opportunities for study and work.
Coordination and governance
The governance of the Single Market is today at the centre of a strategic debate on the effectiveness of European policies for competitiveness. The Draghi Report proposes the establishment of a Competitiveness Coordination Framework (CCF), designed to overcome fragmentations and slow decision-making, making the Single Market more resilient, integrated, and proactive.
Among the main proposals are the strengthening of coordination between Member States with shared action plans, more effective multi-level governance, regulatory simplification with common tools and greater interoperability, the extension of qualified majority voting in strategic areas such as energy, defence, and digital, and the use of Article 122 TFEU for rapid interventions in crisis situations.
Simplified access for SMEs
Despite the availability of European funds and tools, many SMEs encounter practical difficulties in accessing the opportunities offered by the Single Market, due to administrative barriers, procedural complexity, and a lack of information.
To overcome these critical issues, the EU and Member States have introduced digital one-stop shops such as the 'Your Europe' portal and the Funding & Tenders Portal, as well as capacity building and technical assistance programs. Chambers of Commerce, local authorities, and trade associations play a key role in operational support for businesses.
Funds and support tools for businesses
The European Union makes available to Italian businesses a wide range of programs and financial instruments to strengthen competitiveness, support innovation, and foster economic resilience. The Single Market Programme (2021-2027), with an endowment of €4.2 billion, aims to consolidate the governance and competitiveness of SMEs.
This is complemented by Horizon Europe for research and innovation projects, InvestEU for strategic investments, the Recovery and Resilience Facility (RRF), and REACT-EU for employment and digitalization. The European Social Fund Plus (ESF+) promotes vocational training and social inclusion. Complementary instruments such as COSME, the Digital Europe Programme, EU4Health, and the Enterprise Europe Network (EEN) further strengthen EU action in favour of businesses.
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5. The Single Market in the Global Dimension
The Single Market is both an engine of internal integration and a strategic platform for Europe's action on the world stage. In a context of growing geopolitical competition, the EU aims to balance openness and strategic autonomy, protecting competition and strengthening industrial capacity. Through agreements, international standards, and strategic alliances, Europe projects its global influence and creates new opportunities for businesses and citizens. On the international level, the Single Market combines openness and strategic autonomy through procedures such as the Foreign Subsidies Regulation, the International Procurement Instrument, and participation in the WTO's GPA Agreement. Alignment with global standards, mutual recognition agreements, and technical cooperation initiatives strengthen the competitiveness of European businesses.
The European Single Market is a platform for Europe's engagement in the global economy. With the intensification of international competition and geopolitical transformations, the EU has redefined its approach based on the principle of open strategic autonomy: remaining open to trade and investment, while simultaneously reducing dependencies in critical sectors and strengthening the capacity to act autonomously. The COVID-19 pandemic showed how dependence on external supplies could compromise European resilience, particularly for medicines, semiconductors, and raw materials. For this reason, the Commission has identified 137 strategic products subject to vulnerabilities and has promoted industrial alliances in areas such as semiconductors, cloud, aerospace, and zero-emission aviation, with the aim of attracting investment, stimulating research, and consolidating production capacities. For SMEs, these initiatives open access to innovation networks, new business models, and funding opportunities.
On the trade front, the EU participates in the World Trade Organization's (WTO) Agreement on Government Procurement (GPA), a multilateral treaty that aims to ensure transparency, fair competition, and non-discriminatory access to public procurement markets among adhering countries. The GPA allows European businesses to participate in public tenders in other signatory countries, opening global opportunities for over €1.3 trillion. However, many non-EU countries maintain restrictions and discriminatory practices. To guarantee reciprocity, Brussels has introduced the International Procurement Instrument, which allows it to react to barriers imposed by trading partners, strengthening European negotiating capacity. This is complemented by the Foreign Subsidies Regulation, in force since 2023, which allows the Commission to investigate and correct distortions caused by non-EU public funding, applying to large tenders and merger operations. In this way, the EU protects fair competition and the integrity of the Single Market.
Standardization plays a decisive role in the international opening of European businesses. The alignment between European norms and global standards allows for reducing technical barriers and facilitating access to non-EU markets. The main international organizations involved in this process are ISO (International Organization for Standardization), IEC (International Electrotechnical Commission), and ITU (International Telecommunication Union), which define shared technical rules at a global level. The European Union actively collaborates with these organizations to ensure that European norms are compatible with international standards, thus avoiding businesses having to adapt their products to different requirements in every market.
This harmonization is supported by specific agreements, such as the Vienna Agreement between ISO and CEN and the Dresden Agreement between IEC and CENELEC (European Committee for Electrotechnical Standardization), which aim to reduce regulatory duplications and costs for companies. Furthermore, the EU promotes technical cooperation projects with strategic countries to strengthen the dialogue on standardization and increase European visibility in the definition of global rules. Among these projects are SESEI (Seconded European Standardization Expert in India) and SESEC (Seconded European Standardization Expert in China), which facilitate technical comparison and regulatory convergence with key markets like India and China. Finally, thanks to mutual recognition agreements with countries such as Canada, Japan, Australia, and the United States, European certifications can be accepted directly abroad. This mechanism simplifies exports, reduces times and costs of accessing international markets, and strengthens the competitiveness of European businesses.
The Single Market is both the foundation of internal growth and a lever for global competitiveness. For Italian businesses and Chambers of Commerce, this means not only respecting a coherent regulatory system, but above all seizing the opportunities offered by participation in European and international value chains, from industrial alliances to global public markets.
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6. The Digital Single Market: Towards European Technological Sovereignty
The Digital Single Market is the pillar of the European strategy to strengthen competitiveness and technological sovereignty. It aims to eliminate digital barriers, harmonize rules, and simplify access to markets, offering businesses, particularly SMEs, innovative tools to grow in an integrated context. Through digital platforms, cooperation networks, and common regulations, the EU aims to create a safe, transparent ecosystem favourable to innovation, capable of supporting the digital transformation and economic resilience.
In recent years, the EU has taken decisive steps to make the digital market more accessible and secure. Obstacles such as roaming charges have been eliminated and common rules for data protection, privacy, and cybersecurity have been introduced. Today, with the Digital Compass 2030, Europe looks to the future with clear objectives: strengthen digital skills, promote the use of technologies like cloud, big data, and artificial intelligence, guarantee advanced digital infrastructures, and make public services fully accessible online. These milestones are not just political ambitions, but concrete opportunities for Italian businesses to grow, innovate, and expand beyond borders.
In this context, tools like the "Your Europe" portal play a central role. Integrated into the Single Digital Gateway Regulation, the portal simplifies access to national and European regulations and services, reducing regulatory fragmentation and offering greater legal certainty. For SMEs, it means being able to operate more efficiently and with less risk; for Chambers of Commerce, it means being able to offer more targeted advice and promote new entrepreneurial opportunities.
The new European digital legislation further strengthens this framework. The Digital Services Act and the Digital Markets Act regulate digital services and large online platforms respectively, guaranteeing transparency and fair competition. The Data Act, applicable from 2025, governs access to and sharing of data generated by connected devices, favouring interoperability between systems and innovation in production processes. The AI Act, the first European regulation on artificial intelligence, establishes proportional rules based on risk, protecting citizens and opening new perspectives for strategic sectors such as renewable energies, sustainable construction, and advanced mechanics.
At the operational level, the EU has introduced digital tools and cooperation networks that strengthen market surveillance and protect competition. Systems like ICSMS and Safety Gate allow for monitoring non-compliant products and intervening rapidly to protect consumers and businesses. The EU Product Compliance Network facilitates collaboration between national authorities, promoting joint investigations and exchanges of good practices.
Finally, the Digital Single Market is also equipping itself to face future crises. With the Internal Market Emergency and Resilience Act (IMERA), the EU has introduced mechanisms to guarantee free movement even in emergency situations, including joint procurement of essential goods. Initiatives like the Single Digital Gateway and supply chain monitoring tools, such as the European Chips Survey, strengthen Europe's capacity to act in critical technological sectors.
For SMEs and Chambers of Commerce, all this translates into a more integrated, competitive, and innovation-friendly entrepreneurial context. The Digital Single Market is not just a regulatory framework: it is a concrete platform to grow, collaborate, and build the future of the European economy.
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7. The Green Single Market: Engine of the European Ecological Transition
The Green Single Market represents the European Union's response to climate and industrial challenges, with the aim of combining sustainability and competitiveness. This evolution of the internal market promotes decarbonization, the circular economy, and the efficient use of resources, creating new opportunities for businesses and reducing strategic dependencies. Through harmonized rules, financial instruments, and technological innovations, the Green Single Market becomes the engine of the European ecological transition, guaranteeing resilience and sustainable growth.
The green transition implies a profound revision of the European economic model. The efficient use of resources, the promotion of the circular economy, and the decarbonization of productive sectors become strategic levers to reduce dependencies on third countries, stimulate innovation, and guarantee economic security. Indicators such as resource productivity, recycling of urban waste, and the eco-innovation index guide European policies, orienting investments and reforms.
A key element is the eco-design of products, regulated by the new Ecodesign for Sustainable Products Regulation (ESPR). In force since July 2024, the regulation imposes mandatory criteria for durability, repairability, energy efficiency, and digital traceability, the latter guaranteed by the Digital Product Passport. This tool allows for the collection and sharing of essential information on the product life cycle, facilitating reuse, maintenance, and recycling, and strengthening transparency along value chains.
The creation of a true Single Market for Recycling is essential to guarantee the availability of critical raw materials and reduce environmental impact. For businesses, it means being able to rely on harmonized definitions of waste, quality standards for recycled materials, and simplified rules for cross-border transport. The interoperability of digital systems is a further enabling factor, allowing for better integration of material and data flows between Member States.
Within the framework of the European Green Deal and the Fit for 55 package, the decarbonization of the economy is at the centre of industrial policies. The transport sector, for example, is the subject of targeted interventions such as the proposed regulation on clean corporate fleets, which aims to electrify vehicles by 2030, overcoming disparities between Member States and harmonizing incentives.
The energy transition requires significant investments in electricity grids and renewable energy production. The simplification of grid connection procedures and the creation of a Clean Energy Delivery Agency are crucial measures to accelerate electrification and the integration of zero-emission technologies. For SMEs, this means being able to access more modern and sustainable energy infrastructures more easily.
To make the Green Single Market fully operational, a simplified and coherent governance framework is necessary. The integration of national plans into the National Energy and Climate Plan (NECP), the rationalization of funding instruments, and the proposal of a Single Rulebook for access to EU funds are concrete solutions to improve administrative efficiency and facilitate businesses' access to available resources.
Instruments such as the Corporate Sustainability Reporting Directive (CSRD) and the Sustainable Finance Disclosure Regulation (SFDR) orient investments towards sustainable activities, but require greater harmonization to reduce bureaucratic burdens and guarantee coherence between the instruments. For SMEs, greater regulatory clarity is fundamental for planning investments and growth strategies.
European industrial policies strengthen this process. The Chips Act, the Net-Zero Industry Act, and the Critical Raw Materials Act, all adopted between 2022 and 2024, aim to strengthen internal production capacity, reduce strategic dependencies, and guarantee the supply of essential technologies and materials. The industrial transition pathways developed by the European Industrial Forum offer guidance and operational tools for productive ecosystems such as construction, agri-food, and chemicals, supported by public consultations and the Stakeholder Support Platform, which facilitates the involvement of economic and territorial actors.
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2. The Single Market of the Future: Vision and Integration
1. The European Single Market: An Opportunity for Businesses
Since its creation over 30 years ago, the single market has been a powerful catalyst for Europe's growth, prosperity, and solidarity. With 26 million businesses and 450 million consumers, Europe is now the second largest market in the world, with a GDP of €18 trillion representing 18% of the global economy. The European Single Market is the pillar of EU economic integration, founded on the Treaties and regulated by a body of legislation that guarantees the free movement of goods, services, capital, and people. With a complex system of harmonized rules, from public procurement legislation to product safety directives, it ensures a predictable context for businesses and consumers. Thanks to common standards, simplified procedures, and shared governance tools, it supports the competitiveness, innovation, and resilience of industrial supply chains, offering Italy privileged access to an integrated market of continental scale.
The Single Market is based on the free movement of goods, services, capital, and people, eliminating the barriers that once fragmented national markets. For businesses, this means being able to offer their products and services in all EU countries without having to face different rules in each Member State. For consumers, it means having access to a wider range of products, at more competitive prices and with high safety standards. This system is not static: it requires constant work to update rules and remove obstacles that can limit competition and innovation.
A key element for businesses is the harmonization of rules in industrial sectors. In many areas, such as machinery, medical devices, toys, or energy products, European rules replace national ones, simplifying market access. The CE mark is the symbol of this harmonization: it represents the product's conformity to European standards and allows its free circulation in all 27 Member States without further checks. For Italian SMEs, this translates into less bureaucracy, reduced costs, and greater ease of integration into European value chains.
Where common rules do not exist, the principle of mutual recognition comes into play: a product legally marketed in one Member State can also be sold in others, except for exceptions related to the protection of health, safety, or the environment. This principle is essential to avoid fragmentation and ensure that businesses can grow without unjustified obstacles.
For Italian businesses, the Single Market is not just a regulatory framework, but a real growth opportunity. It means being able to compete in a broader context, exploit economies of scale, innovate, and access new customers without facing additional barriers. In an increasingly interconnected economy, the ability to move nimbly within this integrated space is an essential condition for strengthening competitiveness and seizing the challenges of the future.
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