engleski

ISSUES AND CHALLENGES FACED BY RE-STARTERS IN CREATING NEW BUSINESSES IN EU28

Small and medium enterprises (SME) presents the backbone of the European economy. Particular micro enterprises accounted for almost 93% of all enterprises in the non–financial business sector and generated for 37% of the growth in total employment in 2015. In recent years micro and young SMEs of no more than nine years of age were the main net employment creators. But, as new businesses being born every year, many of them fail in their early years. Some were closed voluntarily, while many of them were liquidated or went bankrupt. Moreover, despite previous business failure, many entrepreneurs, so called re-starters would like to create a new business, but they face numerous obstacles in doing so. Consequently, it produces negative effects on economic growth and employment creation in the European economy. In response to such concerns and to stimulate entrepreneurship, the European Commission launched in 2014 Recommendation on a new approach to business failure and insolvency, following a second chance principle of the Small Business Act for the Europe adopted in 2008. Using newly gathered data from the SME Performance Review Annual Report on European SMEs 2015/2016 and Special Study accompanying Annual Report, this paper outlines the main features and challenges faced by re-starters. The results of this study suggests that further progress in implementing the second chance principle, primarily, reducing the discharge from bankruptcy for honest entrepreneurs is essential in creating new businesses.

Small and medium enterprises, re-starters, second chance principle, new business

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