This is Von der Leyen’s new strategy for boosting European competitiveness

A new vision for the next 5 years

Following a transition period after the election last June, 2025 now gets off to a flying start with the recent publication of a new flagship strategy, the Competitive Compass, and the Commission’s 2025 Work Programme.

Released at the end of January, the Competitive Compass outlines a strategic plan to enhance the EU’s economic competitiveness and secure its future prosperity. It focuses on three main pillars:
(i) closing the innovation gap,
(ii) coupling decarbonisation and competitiveness in a joint roadmap, and
(iii) reducing excessive dependencies while increasing security.

Von der Leyen announced a dedicated EU start-up and scale-up strategy, as well as a European Innovation Act, to create an environment conducive to innovation, support business growth, and allow companies to excel in advanced technologies. To achieve this, the EU will explore the idea of creating a 28th legal regime for innovative companies. However, this raises many questions. Promoted as a tool to reduce disparities between national legal systems and facilitate cross-border transactions, the 28th regime has had limited success in the past and remains a significant challenge to implement. Defining its scope is another concern: how will the Commission define ‘innovative’? How will this legal form interact with national frameworks, particularly cooperative and company law? Will innovative SMEs benefit from this status?

We also welcome the focus on resource efficiency and the circular economy in an effort to accelerate the clean energy transition. The upcoming Circular Economy Act, announced for 2026, must recognise the crucial role of cooperatives and social economy entities in circularity, with support measures such as public procurement incentives and simplified administrative procedures. However, the circular economy should not be treated in isolation; it must be linked to the Clean Industrial Deal and, within this framework, should benefit from the new State Aid Framework announced for Q2 2025.

This shift in political priorities, putting competitiveness at the top of the agenda, is reinforced by the Commission’s 2025 Work Programme. In our response to the call for evidence on the Single Market Strategy 2025 (read our full position here), Cooperatives Europe supports the overall prioritisation of competitiveness but warns against an approach that undermines Europe’s social model. We call for the preservation of social conditionalities within EU economic policies and advocate a more balanced allocation of the EU’s limited resources towards social and environmental goals. Strengthening the social dimension within the European Semester and giving greater attention to the Social Convergence Framework (SCF) could contribute to this objective.

Omnibus packages: streamlining or shifting rules?

To boost competitiveness, the Von der Leyen Commission has set a goal of reducing red tape and administrative burdens for enterprises by 25% during its term. In pursuit of this, an Omnibus Package was announced in November 2024, aiming to reduce overlap and simplify reporting requirements in three major regulations: the EU Taxonomy, the Corporate Sustainability Reporting Directive (CSRD), and the Corporate Sustainability Due Diligence Directive (CS3D).

This announcement initially caused confusion and uncertainty, particularly among large companies already adapting to the new rules. It was also unexpected, as EFRAG, the Commission’s Financial Reporting Advisory Group, had only just finalised its work on the European Sustainability Reporting Standards (ESRS) under the CSRD framework.

While the Commission has assured that the content will remain unchanged and only be simplified, many stakeholders fear regulatory rollback, implementation delays, and even changes to reporting obligations. Some argue that focusing on the implementation of existing rules would be more efficient than making alterations at this stage. This uncertainty has already slowed the dissemination and adoption of the Voluntary SME Standards, an area where Cooperatives Europe is actively engaged.

It is expected that the omnibus packages will lead to harmonised rules and procedures, digitalised compliance processes, and some consolidated data points. While this may bring certain advantages, it also risks increasing confusion and errors among large enterprises operating in the Single Market. To truly foster EU competitiveness, the Commission must ensure consistency in its approach.

The newly released 2025 Work Programme announces three different omnibus packages: one on sustainability, one on investment simplification, and one focused on small mid-caps and the removal of paper requirements. Cooperatives Europe will closely monitor the publication of the first Omnibus Package on 26 February, as it is expected to set the tone for future packages.