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Enhancing access to finance for innovative companies
Commitment 11
Access to Finance - Venture Capital
Innovation Union commitment text

"By the end of 2011, the Commission will present a proposal for a new legislative regime to ensure that Venture Capital funds established in any Member State can function and invest freely in the EU."

Framework Conditions for Business R&D - Venture Capital in 2009
Note: EU does not include EE, CY, LV, LT, MT, SI, SK in respect of which data are not available.
  • What is the problem?
  • What is our objective?
  • Implementation
  • Milestones
  • Background documents
  • Contact

From Commission work since 2003 it is clear that not enough progress has been achieved in reducing the fragmentation of European venture capital markets. Despite efforts to facilitate cross-border investment, there are 27 operating environments for venture capital funds and although operating across multiple jurisdictions is possible, it is complex, costly and most funds tend to avoid it altogether. This situation is an anomaly in the single market, an anomaly that seriously limits the prospects of commercialising innovation and lowers European growth.


To make the efficient European venture capital market a reality (as outlined in the Europe 2020 Strategy), the Commission will identify remaining obstacles that hinder the smooth functioning of venture capital markets, and take an appropriate action.

Only a single European venture capital market is able to overcome the fragmentation and small scale that currently characterise the sector. Only at European level is it possible to achieve the necessary scale and the strong participation of private investors that are the hallmarks of a self-sustaining venture capital market. The goal of EU involvement is to promote the development of a self-sustaining venture capital industry, with the strong participation of institutional investors.

To this end, Directorate General for Internal Market and Services will launch public consultation in June 2011, the aim of which is to consult on the main elements for a new European regime for venture capital.


Preparation and implementation of further actions on venture capital will be done in cooperation of the Commission services, with Directorate General for Internal Market and Services being responsible for any legislative actions.

Cooperation with the Member States is essential, as it is for them to improve the fiscal environment of venture capital. To avoid double taxation, a venture capital fund that is fiscally transparent in its home Member State should also be transparent for tax purposes in all other Member States. Further, investors in venture capital should also have the certainty to benefit from double tax treaties between Member States. A tax-transparent structure enables investors to be treated as if they had received income and capital gains from the investee company, so that the vehicle used (the venture capital fund) has no effect on this. In addition, investors should not be judged to have a permanent establishment in the country of the investee company.

June 2011 Launch of public consultation on the main elements for a new European regime for venture capital
Type: Communication activities
End of 2011 Commission proposal for a new legislative regime
Type: Legislative
Lead Directorate-General/Unit, Head of Unit


Other Directorates-General/Units associated


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