A clear, proportionate, coherent, and predictable regulatory framework is essential to foster investment, innovation, and economic growth. The accumulation of rules, overlapping obligations, or the existence of divergent requirements across jurisdictions can generate costs and complexity without necessarily resulting in higher levels of protection or legal certainty.
Simplification should be understood as a general principle of good regulation. Simplification does not mean deregulation or lowering levels of protection; rather, it means achieving public policy objectives in the most effective and efficient way possible, avoiding duplication and promoting risk-based, technology-neutral rules that can adapt to evolving markets.
To achieve this, a governance model is needed that integrates simplification throughout the entire regulatory cycle, from the design of rules to their implementation and review. This involves assessing whether new regulations are genuinely necessary or whether alternative instruments exist, analyzing cumulative effects, and consulting affected sectors at an early stage.
It also requires proportionate implementation and periodic evaluations of existing regulations, greater coordination among authorities and jurisdictions, and efforts to avoid divergent or duplicative obligations.
The European Union Case: Simplification for Competitiveness
In the European Union, this challenge is particularly relevant. The gradual accumulation of regulation and its uneven implementation across Member States have contributed to a complex and fragmented environment that may hinder investment, innovation, and companies’ ability to scale.
The Draghi and Letta reports helped place simplification at the heart of the European competitiveness and Single Market agenda. The challenge now is to turn that ambition into a structural and sustained process, one that goes beyond reducing specific administrative burdens to reviewing the existing regulatory stock while also preventing new complexity through institutional cooperation among the various services of the European Commission and the relevant authorities. At Telefónica, we advocate for an ambitious regulatory simplification agenda, supported by governance mechanisms that ensure regulatory coherence and assess cumulative impacts. At the European level, this approach should also help reduce fragmentation and strengthen the Single Market, enabling companies to invest, innovate, and scale while fully preserving the protective impulses of regulation.
