Small and medium-sized enterprise (SME) (EU)

A category of enterprises defined for EU law purposes in European Commission Recommendation 2003/361. The Recommendation defines categories of micro, small and medium enterprises based on their staff headcount and either their turnover or balance sheet total.

For EU law purposes, SMEs are considered to face particular challenges due to their size. They may therefore be eligible for preferential treatment in public support. The definition is widely used in areas such as competition law, structural funds, research and innovation and is relevant in the context of some EU administrative exemptions and reduced fees, such as for the REACH Regulation (1907/2006).

In February 2018, the Commission publicly consulted on a proposal to amend the definition; see Legal update, SMEs: European Commission launches public consultation on review of EU SME definition.

For further information, see also European Commission: DG GROWTH: What is an SME?.