This week, the German government adopted key points for a digital check and a national law to reduce bureaucracy. The digital check is intended to introduce the practice of examining legislative proposals for their digital suitability across the board. The new Bureaucracy Reduction Act is intended to reduce unnecessary bureaucracy and ensure the effective implementation of EU law with a minimum of red tape. The Startup Association welcomes these first steps towards reducing bureaucracy and is calling for more speed in digitalization.
“Startups and scaleups think digitally and innovatively by nature. Especially with limited human and financial resources, they are particularly burdened by excessive bureaucracy,” says Magdalena Oehl, Deputy Chairwoman of the Startup Association. “The digital check is an important step forward. The German government must consistently continue on its path towards digitalization and bureaucracy reduction and create even more commitment and consistency when examining laws for their digital suitability.” In the German Startup Monitor 2022 conducted jointly with PwC Germany, 9 out of 10 German startups called for the acceleration and simplification of administrative processes.
“The digital check can help to ensure that legal regulations correspond to our digital realities. In order to successfully shape the transformation of the economy, we need more efficiency and less bureaucracy in Germany overall. Digitalization has a decisive role to play here. This applies not only to new laws, but also to many existing administrative practices. Too often, we are still getting in our own way with our rules,” Oehl states. In the hearing of associations on the Bureaucracy Relief Act, the startup association criticized unnecessary bureaucracy and a lack of digitalization as well as the inconsistent implementation of EU law.
The bureaucratic burden slows down start-ups and scale-ups, and German legislation often requires important processes to be documented on paper. Other EU member states are making much more ambitious use of the Digitalization Directive than Germany and are thus gaining a competitive advantage – in Austria, a startup has accelerated the process of going to the notary when founding a company by means of electronic notarizations. “Even with the quick improvements that the German government introduced right at the beginning of the legislative period with the so-called Supplementary Act (DiREG), Germany is falling unnecessarily behind the possibilities,” emphasizes Oehl.
In the past, the startup association had criticized the German government’s lack of digital ambition, for example in the implementation of the EU Working Conditions Directive. The paperwork requirement contained therein meant a completely avoidable additional expense for startups and scaleups, while the EU’s explicit leeway remained unused. “The law would have failed its own digital check”, says Oehl.
About the Startup Association
The German Startups Association represents the interests of startups vis-à-vis politics, business and the public. In its network of 1,200 members, the association creates an exchange between startups, scaleups, investors and the established economy. The aim of the Startup Association is to make Germany and Europe a more start-up-friendly location.
