Definition of a SME to be reviewed – have your say

The European Commission is currently preparing for an evaluation and possible revision of some aspects of the definition of a SME (small or medium enterprise, or sometimes small or micro enterprise). A public consultation has been launched to allow any interested parties to provide feedback. The definition is important for access to finance and EU support programmes targeted specifically at this size of business.

To comment on the new proposals, follow this link.


SME definition

The SME definition as provided in Recommendation 2003/361/EC is the tool used to identify enterprises that due to their size can face particular challenges. For this reason they are allowed to receive preferential treatment in the form of public support.

It is a widely used tool in EU policies such as competition (state aid), structural funds, research and innovation, and relevant for some European administrative exemptions and reduced fees.

The main factors determining whether an enterprise is a SME are staff headcount and either turnover or balance sheet total.

‘Micro’ enterprises employ less than 10 people and have a turnover or balance sheet total of under €2m.

‘Small’ enterprises employ less than 50 people and have a turnover or balance sheet total of under €10m.

Medium enterprises are classed as such with a turnover of up to €50m or balance sheet total of €43m, employing less than 250 people.

These ceilings apply to the figures for individual firms only. A firm that is part of a larger group may need to include staff headcount/turnover/balance sheet data from that group too.