Rulemaking across the European Union must address increasingly complex challenges, ranging from ensuring the responsible use of new technologies to driving the green transition. To respond to citizens’ expectations and promote competitiveness and resilient growth, governments must ensure laws and regulations achieve their objectives and remain targeted, proportionate and simple to implement. This third edition of Better Regulation Practices across the European Union critically examines steps taken by EU Member States to promote the quality of rulemaking across the entire policy cycle for both domestic and EU rules. Using the OECD Indicators of Regulatory Policy and Governance, it tracks progress in implementing the OECD Recommendation on Regulatory Policy and Governance and identifies priorities for further improvement.
Better Regulation Practices across the European Union 2025
Abstract
Executive summary
To limit burdens whilst solving complex policy challenges, regulatory interventions need to be carefully calibrated. Laws and regulations are a powerful tool for governments across the European Union (EU) seeking to harness the transformative power of (technological) innovation, such as AI, whilst keeping people safe and driving forward the green transition. At the same time, regulatory burdens and complexity affect people’s lives and undermine European competitiveness. Consistency and regulatory efficiency are especially important in the EU to unlock the full potential of the Single Market based on common rules across 27 Member States. Governments across the EU must rise to this challenge to retain and strengthen trust in their collective action and problem-solving capacity.
To get the balance right and make rules smarter, simpler and more streamlined, governments must embrace “better regulation” practices, as articulated in the OECD Recommendation on Regulatory Policy and Governance. This third edition of the Better Regulation across the European Union report tracks the progress made by EUMS in embedding these practices across different stages of the policy cycle. Appropriate reflection is also given to the EU’s unique institutional ecosystem, in particular how Member States use better regulation tools in relation to EU law at the negotiation and transposition stage. The report also provides country profiles that track recent progress and highlight areas for further improvement in EUMS’ better regulation systems.
In the face of increasingly complex challenges, EUMS need to build on their foundations for better regulation to improve how they use tools to optimise new and existing rules. Virtually all EUMS have articulated a strategy on better regulation and have assigned institutional responsibility and high-level leadership to translate better regulation principles into practice. However, the focus often remains on developing new rules – ex ante regulatory impact assessment and stakeholder engagement are relatively well developed compared to ex post evaluation although important gaps towards best practice persist and improvements have been marginal. Conversely, ex post evaluation remains far from being fully developed, yet has benefited from some more measured improvements over recent years.
To avoid jumping to regulatory solutions and quick fixes, decision makers need to involve stakeholders and use evidence before deciding if, and how, to intervene. Early engagement with citizens and other stakeholders enables a better understanding of policy issues and possible solutions. Similarly, assessing and comparing different options can highlight potentially less burdensome alternatives. Despite some improvements, significant gaps remain among EUMS. For instance, early engagement remains mostly sporadic and alternative options – especially non-regulatory – are still not consistently considered across all EUMS, suggesting that evidence is used to justify rather than to inform policy.
At a later stage once a draft rule has been prepared, impact assessment and consultation procedures are relatively well developed but opportunities remain to strengthen the evidence base and boost transparency. Systematically weighing costs against expected benefits is essential to avoid biased decision making. Critically, to promote long-term prosperity, policymakers need to consider how rules affect competitiveness and the economy as a whole but this is rarely required across EUMS. More granular analysis, for example on decarbonisation targets or inequality, would afford a better understanding of the effects on people and the environment. Finally, governments routinely seek public input on draft rules but need to do better at responding to feedback, as less than half issue a public response to comments, with little recent improvement. Doing so does not only strengthen transparency but also demonstrates governments’ responsiveness to people’s concerns and helps secure buy-in.
To secure real-life impact and simplify compliance for business and people, governments need to plan better how they will implement rules and apply “smart” enforcement approaches. No matter how well designed, the real-life impacts of a rule flow from its implementation However, this often comes as an afterthought as only a minority of EUMS require active planning on how compliance should be achieved and identify methodologies and indicators to track results. Similarly, only a minority of governments in the EU actively require their inspection and enforcement authorities to base activities on risk and to use data-driven approaches to ensure targeted and streamlined enforcement.
More systematic and outcome-focused ex post evaluation of rules is needed to close the policy cycle. In a rapidly changing world, periodic evaluation is needed to keep rules fit for purpose and to remove unnecessary burdens. Currently, these efforts remain unsystematic in most EUMS, creating a risk of “regulate and forget”. There is also limited evidence that EUMS translate evaluations into tangible improvements. To change this, a more methodical approach is needed to target efforts on those rules with the highest impacts and assess the achievement of objectives as well as unintended consequences – something only few EUMS do systematically. Finally, policymakers need to listen to those impacted by rules to inform review findings and communicate clearly the action they will take in response.
To ensure a level playing field across the Single Market and boost European competitiveness, better regulation needs to be fully embedded throughout the whole of the EU policy cycle. Whilst legislative proposals from the Commission with significant impacts are subject to impact assessment and consultation procedures, this is not typically the case for substantive amendments made by the co-legislators, the European Parliament and the Council. Similarly, EUMS still have room for improvement when they intervene in the development of EU law through Council negotiations and, later on, when transposing and implementing them. Only a minority of them systematically use impact assessment and stakeholder views to inform national positions for Council negotiations. In addition, the risk of “gold-plating” in the transposition of directives often goes unchecked, potentially risking unnecessary burdens and a fragmentation of the Single Market. Finally, more effective pooling of evidence and sharing best practices between Member States and institutions across the policy cycle is needed to ensure EU laws are practical, drive consistent implementation and aid continuous improvement.
