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Social Entrepreneurship Funds

Social businesses combine a social, ethical or environmental mission with the entrepreneurial flair and innovation of a business perspective. They can face some specific challenges in getting investments. The Commission announced in the Single Market Act work to explore how private investment funds might help, so that investors and social businesses better reap the benefits of the single market. This includes ensuring there are no unintended barriers within EU fund rules to the efficient channeling of investments to social businesses.

This work forms part of the Social Business Initiative.

Regulation on European Social Entrepreneurship Funds

The regulation sets out a new ”European Social Entrepreneurship Fund“ label, so investors can easily identify funds that focus on investing in European social businesses. The approach is simple: once the uniform requirements defined in the proposal are met, managers of social entrepreneurship funds will be able to use the new label and market their funds across the whole of Europe. Every fund using the label will have to prove that a high percentage of investments (70% of the capital received from investors) are spent in supporting social businesses. Uniform rules on disclosure will ensure that investors get clear and effective information on these investments.

Text of the regulation as adopted by the European Parliament and the Council (17.04.2013)

Proposal by the Commission (07.12.2011)

Consultation – 13/07/2011