Why the EU's Better Regulation Agenda Needs a Fresh Start: A Systemic Audit of Failures and Bold Reforms

By an independent policy analyst

The European Union’s better regulation framework is often held up as a global gold standard. It includes mandatory impact assessments, stakeholder consultations, an independent Regulatory Scrutiny Board (RSB), and the REFIT programme for reducing administrative burdens. Yet the paradox is stark: despite decades of burden‑reduction efforts, the stock of EU regulation continues to grow faster than in comparable economies, and businesses—especially small and medium‑sized enterprises (SMEs)—report a rising compliance burden. As Mario Draghi warned in his 2024 competitiveness report, “regulatory burden is high and growing, despite decades of better regulation initiatives.” A new Bruegel policy brief (January 2026) by Bucher and Goldberg drills into the systemic failures behind this contradiction, identifying coverage gaps, poor evaluation quality, and a lack of scrutiny over political amendments as the root causes. This article conducts a deep audit of where the framework has gone wrong and what a fresh start could look like.

[IMAGE: Side-by-side comparison: a complex regulatory flowchart with many interconnected boxes vs. a simple, streamlined alternative with fewer nodes and clearer pathways.]

The Paradox of a Highly-Rated System That Isn't Working

On paper, the EU’s better regulation toolset is among the most sophisticated in the world. Since the early 2000s, the European Commission has required that every legislative proposal with significant economic, social, or environmental impacts be accompanied by an impact assessment (IA). The RSB, an independent body, vets these assessments for quality. The REFIT platform continuously identifies opportunities to cut red tape. And since 2007, successive Commissions have set explicit burden‑reduction targets.

Yet the outcomes reveal a glaring gap between ambition and reality. The Bruegel policy brief 01/2026 points to a fundamental flaw: the system’s coverage is incomplete. Many key regulatory initiatives—particularly simplification measures under the von der Leyen Commission—have been exempted from the standard impact assessment process. Emergency regulations and fast‑track procedures regularly bypass the normal scrutiny cycle. Moreover, the European Parliament and the Council introduce thousands of amendments during the legislative process, almost none of which undergo a formal impact assessment. These amendments can dramatically alter the regulatory burden of a proposal, but they receive no dedicated regulatory scrutiny.

The most damning evidence comes from the data: there is no empirical proof that any burden‑reduction target set since 2007 has actually curbed the flow or stock of regulation. Regulatory burden continues to rise, not fall. The system, in short, has been hollowed out by its own exceptions and political expediency.

[IMAGE: Graph showing EU regulatory stock growth vs. US/China over time—a conceptual line chart with an upward EU trajectory that is steeper than the US and China lines, with a note “cumulative compliance costs rising”.]

Hidden Economic Logic: Why Regulatory Accumulation Hurts Competitiveness

The costs of this failure are not abstract. The 2024 Draghi report on European competitiveness made the connection explicit: EU regulation grows faster than in the United States or China, translating into higher compliance costs for firms operating in Europe. This is particularly damaging for SMEs, which lack dedicated compliance teams and legal departments. Large multinationals can absorb and even leverage regulatory complexity, but smaller enterprises face a disproportionate burden.

But the problem goes beyond simple direct costs. There is a hidden regulatory ‘stacking’ effect. When multiple pieces of legislation interact—for example, the General Data Protection Regulation (GDPR), the Digital Services Act, the AI Act, and sector‑specific rules—their combined requirements create unanticipated frictions. Compliance with one rule may conflict with the demands of another, forcing firms to adopt costly workarounds or abandon certain business models. The Bruegel policy brief notes that ex‑post evaluations rarely capture these cross‑sector or cumulative effects. Instead, each law is assessed in isolation, missing the systemic drag.

This uncertainty has real economic consequences. Companies delay investment, innovation, and hiring when they cannot predict future regulatory requirements. A 2025 survey by the European Business Association found that 43% of SMEs had postponed or cancelled an investment plan in the past year solely due to regulatory unpredictability. Furthermore, cascading compliance costs ripple through supply chains: a rule imposed on upstream producers (e.g., chemical registration under REACH) becomes embedded in the price of downstream goods, amplifying the burden without any formal impact assessment of the final effect on consumers or smaller EU reform beneficiaries.

[IMAGE: A Venn diagram showing three overlapping circles labeled “Coverage exceptions”, “Amendment gaps”, “Evaluation quality”, with a central intersection labeled “Systemic failure”.]

Three Systemic Gaps That Undermine the Entire Framework

Bucher and Goldberg’s analysis identifies three critical gaps that, together, explain why the better regulation machinery is failing.

Gap 1: Significant exceptions to better regulation application. The most egregious example is the von der Leyen Commission’s simplification agenda. Dozens of ‘simplification’ proposals—which, in reality, often replaced multiple rules with a single, broader regulation—were fast‑tracked without full impact assessments on the grounds that they were administrative, not political. The RSB itself has repeatedly flagged the rising number of proposals that arrive with no IA or with an IA of inadequate quality. This creates a perverse incentive: if you want to avoid scrutiny, label your proposal a ‘simplification’.

Gap 2: Few assessments of amendments introduced by the European Parliament and Council. The inter‑institutional agreement on better regulation requires that only the Commission’s original proposal undergoes an IA. Once the Parliament and Council begin their work, the legislative chambers can add, delete, or modify provisions with no requirement to assess the consequences. A 2023 study by the European Parliamentary Research Service found that one in three final‑text amendments had a significant impact on regulatory costs or compliance burdens, yet none were evaluated beforehand. This is a black hole in the regulatory scrutiny system.

Gap 3: Quality of ex‑post evaluations is wanting. The European Court of Auditors (ECA) has repeatedly criticised the Commission’s ex‑post evaluations as superficial. They often rely on self‑reported data from Member States and industry groups, without independent verification. They rarely examine actual implementation costs, unintended side effects, or the interaction between different laws. As a result, the feedback loop that should inform future legislation is broken. The ECA’s 2024 Special Report on REFIT concluded that “the Commission does not systematically assess whether the expected burden reductions have materialised.”

[IMAGE: A simple infographic showing a timeline from 2007 to 2026 with markers for each burden‑reduction target, and a rising red line labelled “actual regulatory stock” that consistently outpaces the blue target line.]

Why Burden-Reduction Programmes Have Failed (So Far)

If the structural gaps are clear, why have decades of burden‑reduction programmes not fixed them? The answer lies in several design flaws and political economy constraints.

First, REFIT exercises focus on individual laws. They examine a regulation’s internal efficiency but ignore the cumulative burden across multiple pieces of legislation and cross‑sector interactions. A firm that must comply with fifteen separate EU rules cannot be helped by simplifying just one of them. The real cost of administrative burden reduction is systemic, not atomistic.

Second, target‑setting since 2007 has been vague and disconnected from the legislative process. The Commission has repeatedly announced headline targets—e.g., “reduce administrative burdens by 25% by 2012” (the 2007 Action Programme) or “reduce reporting obligations by 25%” (the 2021 Fit for 55 package)—but these targets are rarely embedded into the actual drafting of laws. They function as political signalling rather than binding constraints. Moreover, the definition of “burden” is often narrowed to administrative costs only, ignoring substantive compliance costs such as product redesign, testing, or legal advice.

Third, there is a powerful political economy at play. EU reform that cuts burdens inevitably encroaches on the priorities of Member State ministers and Members of the European Parliament. A regulation that imposes a high cost on business may be popular with voters for its ostensible benefits (e.g., environmental protection, consumer safety). Ministers and MEPs resist burden cuts that affect their own constituencies or legislative pet projects. Without a strong institutional mechanism to force trade‑offs—such as an independent regulator with veto power—the default is to add new rules without subtracting old ones. This is why the stock of EU regulation continues to grow, despite three decades of rhetoric about simplification.

The Bruegel policy brief argues that the only way to break this cycle is a systemic reboot. The authors propose six transformative reforms: appointing a dedicated Better Regulation Commissioner with a mandate to veto proposals that fail quality standards; implementing systematic regulatory pauses every five years to review accumulated rules; externalising ex‑post evaluations to independent auditors; making all amendments subject to rapid impact assessments; setting a legally binding regulatory cap linked to GDP growth; and requiring that any new burden be offset by equivalent simplification elsewhere. These proposals go far beyond the current incremental tinkering. They demand a fresh start for the better regulation agenda—one that finally matches the sophistication of its design with the rigour of its enforcement.

[IMAGE: A stylised isometric illustration of a large tangled knot of blue and yellow threads (EU colours) with a pair of scissors and a clean ruler in the foreground, symbolising the need for decisive action to cut through regulatory complexity.]