Quarterly registrations of new businesses and declarations of bankruptcies - statistics
Data released on 15 February 2024
Planned update: 16 May 2024
Highlights
In the fourth quarter of 2023, seasonally adjusted registrations of businesses increased by 0.1 % in the EU, compared with the third quarter of 2023, yet again reaching highest levels since 2015.
In the fourth quarter of 2023, seasonally adjusted bankruptcy declarations increased by 0.6 % in the EU, compared with the third quarter of 2023, still above the pre-pandemic (fourth quarter 2019) levels.
This article presents data on the number of new business registrations and the number of bankruptcy declarations in the European Union (EU) and in the euro area (EA) until and including the fourth quarter of 2023. The data is based on the absolute number of registrations and bankruptcies sent to Eurostat by EU Member States on a mandatory basis since the first quarter of 2021 (and on a voluntary basis until the fourth quarter of 2020). The tables provide a complete picture of the available data. In addition, since February 2023, there is a section on the annual bankruptcies in absolute figures for the period 2015-2022, based on the available quarterly absolute figures transmitted to Eurostat.
The data transmitted since the first quarter of 2021 is a legally-binding requirement, under the European Business Statistics (EBS) Regulation, for the variables: registrations of businesses and declarations of bankruptcies. The voluntary nature of the data collection until the end of 2020 and the limited length of the current time series do not allow the application of seasonal adjustment in full scale and some further adjustment can be expected as longer time series become available. Any conclusions about the evolution of registrations of businesses and bankruptcy declarations in the EU Member States and the euro area need to be made with caution.
Full article
Quarterly comparison in the EU and euro area
The number of registrations of new businesses in the EU was predominantly on an upward trend since 2015 until the end of 2019. The trend reversed with significant decreases in the first and second quarters of 2020, to recover again in the third quarter of 2020. There was no clear trend in the number of registrations between the fourth quarter of 2020 and the fourth quarter of 2022. Then over all four quarters of 2023, the number of registrations has been on a slight upward trend. In the second quarter of 2023, registrations reached the highest level since 2015, surpassing the previous peak from the second quarter of 2021. Then with the following increases in the third and fourth quarters of 2023, the number of registrations reached consequently new highest levels since 2015 (Figure 1).
,_registrations_of_businesses,_Q1_2015_to_Q4_2023.png)
Source: Eurostat (sts_rb_q)
Regarding the number of declarations of bankruptcies, there has been a downward trend between the first quarter of 2015 and the first quarter of 2017, then turning mainly upwards until the third quarter of 2019. There were considerable decreases in the first and second quarters of 2020. The decrease in bankruptcies, observed in many Member States in the first two quarters of 2020, can be explained by the government measures supporting businesses during the beginning of the COVID-19 crisis which allowed the businesses to avoid declaring bankruptcy. After that, the number of bankruptcy declarations increased for three consecutive quarters, from the third quarter of 2020 until the first quarter of 2021, while still remaining below the pre-pandemic levels (i.e. between Q1 2018 and Q4 2019). Then the bankruptcy declarations reached a peak in the third quarter of 2022, which was the highest level recorded since the second quarter of 2015. In the second quarter of 2023, the number of bankruptcy declarations rose even higher than the previous peak (from the third quarter of 2022) and at levels just slightly below the highest level observed in the first quarter of 2015. Then the bankruptcy declarations decreased in the third quarter of 2023, which was followed by a slight increase in the fourth quarter of 2023, while still being above the pre-pandemic levels (between Q1 2016 and Q4 2019) (Figure 2).
,_declarations_of_bankruptcies_of_businesses,_Q1_2015_to_Q4_2023.png)
Source: Eurostat (sts_rb_q)
In the fourth quarter of 2023, the seasonally adjusted number of registrations of businesses was up by 0.1 % in the EU and down by 1.1 % in the euro area, compared with the third quarter of 2023. In the third quarter of 2023, the number of registrations of businesses was up by 0.6 % in the EU and by 0.4 % in the euro area, compared with the second quarter of 2023 (Figure 3).
Source: Eurostat (sts_rb_q)
In the fourth quarter of 2023, the seasonally adjusted number of declarations of bankruptcies increased by 0.6 % in the EU and by 2.7 % in the euro area, compared with the third quarter of 2023. In the third quarter of 2023, declarations of bankruptcies decreased by 9.4 % in the EU and by 10.9 % in the euro area, when compared with the second quarter of 2023 (Figure 4).
Source: Eurostat (sts_rb_q)
Quarterly comparison by Member State
Comparing the fourth quarter of 2023 with the third quarter of 2023, among the EU Member States for which data are available, the biggest increases in registrations of new businesses were observed in Ireland (+84.1 %), Romania (+11.4 %) and Poland (+7.6 %). The largest decreases in registrations of new businesses were observed in Luxembourg (-10.3 %), Slovakia (-10 %) and Denmark (-8.1 %) (Table 1).
Source: Eurostat (sts_rb_q)
Comparing the fourth quarter of 2023 with the third quarter of 2023, among Member States for which data are available, the highest increases in bankruptcy declarations were observed in Croatia (+18.5 %), Slovakia (+16.8 %) and Luxembourg (+15.7 %). The largest decreases in the number of declarations of bankruptcies were recorded in Latvia (-26.8 %), Hungary (-25.6 %) and Romania (-23.4 %) (Table 2).
Source: Eurostat (sts_rb_q)
Quarterly comparison by activity
For almost all sectors of the economy, the number of registrations of new businesses was mainly on an upward trend from 2015 until the end of 2019 (with only trade being on a slight downward trend). The number of new registrations dropped sharply in all sectors of the economy in the first and second quarters of 2020 (linked to the COVID-19 pandemic), and recovered again in the third quarter of 2020.
Comparing the fourth quarter of 2023 with the third quarter of 2023, increases in the registrations of businesses were recorded in only three of the sectors of the economy, with a more articulated increase in transport, and smaller increases in construction, and accommodation and food services. On the other hand, small to minor decreases in the number of registrations were observed in the following sectors: information and communication, financial and insurance activities, trade, industry, education and health services, and construction.
In the fourth quarter of 2023, registrations of businesses remained at higher levels than before the COVID-19 crisis (fourth quarter of 2019) in almost all sectors of the economy. Only in accommodation and food services, there were fewer businesses registered in the fourth quarter of 2023 than in the fourth quarter of 2019, before the COVID-19 pandemic (Figure 5).
,_registrations_of_businesses_by_activity_,_Q1_2015_to_Q4_2023.png)
Source: Eurostat (sts_rb_q)
For the whole of the economy (industry, construction, market services), the number of declarations of bankruptcies showed mainly a downward trend in 2015 and 2016, and were then mostly on a slight upward trend from the first quarter of 2017 until the third quarter of 2019. In all sectors of the economy, there was a significant cumulative decrease in bankruptcy declarations in the first two quarters of 2020 (linked to the extraordinary financial support provided by governments in the first months of the pandemic). Then, during the following three quarters (form third quarter of 2020 to the first quarter of 2021), the bankruptcy declarations were essentially on an upward trend in all sectors of the economy. In the third quarter of 2023, the number of bankruptcy declarations decreased in most sectors, with the notable exception of the information and communication sector, and also industry, and construction which recorded increases. Then, in the fourth quarter of 2023, the number of bankruptcies declarations rose in four sectors and decreases in another four sectors. The more articulated changes, compared with the previous period, were the decrease of bankruptcies in information and communication, and on the other hand the increase of bankruptcies in transport (Figure 6).
![A line chart showing the trend in declarations of bankruptcies in the EU by activity, from the first quarter of 2015 to the fourth quarter of 2023. Data are seasonally adjusted and 2015=100.]](/eurostat/statistics-explained/index.php?title=File:EU_(available_countries),_declarations_of_bankruptcies_by_activity_,_Q1_2015_to_Q4_2023.png)
Source: Eurostat (sts_rb_q)
Source data for tables and graphs
Annual bankruptcies in absolute figures
Following requests by users for getting access to annual data of bankruptcies in absolute values, these annual data (starting with reference year 2015) were first published as part of this article in February 2023 (and last updated in May 2023). The next update of the annual data of bankruptcies in absolute values (which will comprise the 2023 data) will take place in May 2024. The annual data are calculated by Eurostat, as the sum of the four quarters, transmitted by the countries in line with the requirements of the European Business Statistics Regulation. Only the total number of bankruptcies is published per country, without any NACE breakdown. In the same annual bankruptcies data file, a table has been added with: methodological notes comprising the definition of the bankruptcy in the countries; the legal forms included in the total number; and the source of the data. The publication of the annual data in the following data file covers all countries that agreed to have their data published.
Data sources
This publication (starting from the May 2021 edition) is covered by the mandatory data collection and transmission on quarterly business registrations and bankruptcy declarations under the EBS Regulation. The article also builds upon the three quarterly editions before 2021 that were based on experimental statistics. The historical data from Q1 2015 to Q4 2020 remains voluntary. The data are also available in Eurostat's reference database.
Since February 2023 also monthly data on business registrations and bankruptcy declarations are being released by Eurostat. The monthly data are collected and transmitted on a voluntary basis. The monthly data are also available in Eurostat's reference database.
Methodology and definitions; differences between quarterly and annual business demography data
Registrations on new businesses: The number of entered legal units in the registration register at any time during the reference quarter Q, according to the respective administrative or legal procedure. Registrations is an early indicator to measure business intentions. In every country, administrative rules of registrations differ, so the quarterly data are presented as an index series to improve comparability.
Registrations cannot be directly compared with enterprise births. Registrations of businesses are part of administrative procedures, while annual data on enterprise births are based on the start-up of business activity in terms of having turnover, employment or investment. The registration of a legal unit can be considered as a declaration of intent but does not necessarily mean it continues as a business activity in line with annual business demography concept. Registration data are not based on the enterprise demography characteristics 'date of commencement of activities' but rather on the 'date of registration' that is not necessarily the same.
The statistical unit in annual business demography statistics on births is the enterprise, while quarterly data on registrations refer to legal units (several legal units can constitute one enterprise, a registration of a new legal unit therefore does not necessarily mean the birth of a new enterprise). In some countries the coverage of legal forms or of NACE activities in quarterly registrations compared with annual births in business demography may differ. Annual business demography may have a threshold with respect to turnover in order to be included in the statistics concerned. Registrations and births may also be recorded in different reference periods or years. Due to the methodological differences, there is no direct comparability with annual business demography statistics on births of enterprises.
Bankruptcies: The number of legal units that have started the procedure of being declared bankrupt, by issuing a court declaration, at any time during the reference quarter Q (this declaration is often provisional and does not always mean cessation of an activity).
The bankruptcies indicator is an early sign to measure the sentiment in business environment. Quarterly statistics on bankruptcies are frequently different from annual business demography statistics on deaths of enterprises, because they cover deaths of enterprises due to bankruptcies, as well as other reasons. Bankruptcies that were filed do not necessarily mean closing of the business. Even if an enterprise has declared bankruptcy, it does not always mean that it ceases all activity when it enters into bankruptcy procedure. In order to be recorded as an enterprise death in annual business demography typically all production factors have been dissolved.
There are several methodological differences between the concepts of bankruptcies and enterprise deaths. Quarterly business demography data on bankruptcies are based on legal units, while annual business demography data on deaths is based on the statistical unit enterprise. Moreover, in some countries self-employed persons are rarely subject to bankruptcy procedure. There may also be significant differences between countries with respect to bankruptcy laws. In some countries, when a business declares itself bankrupt, it means that it has to cease immediately all activities whereas in other countries, they can continue to trade under a certain operation control. Some businesses declaring themselves bankrupt may therefore eventually recover, and would therefore not be considered as an enterprise death. The proportion of bankruptcy procedures that finally end up as an enterprise death varies therefore across countries depending on the bankruptcy laws. In addition, minimum thresholds of e.g. turnover may apply to annual business demography data, but not necessarily to quarterly data on bankruptcies.
To conclude, the scope and contents of annual business demography statistics on deaths of enterprises may differ considerably from quarterly data on bankruptcies and the levels of these two statistics may therefore vary considerably. In general, bankruptcies represent only a fraction of all enterprise deaths; they cannot be directly compared with annual business demography data on deaths of enterprises.
Respective strengths of quarterly and annual data: The quarterly data on registrations and bankruptcies reflect the intention of a business to start economic activities or to close down activities. The annual data reflect the economic reality in terms of enterprises having turnover, employment or investment (births) or the dissolution of them (deaths).
Calculation of indexes and EU aggregates
The available national indices are calculated by dividing the absolute figures of each period by the average of the base year (2015). National absolute figures are not directly aggregated because of different legislations, administrative practices and economic structures of the Member States.
Some countries asked for their data not to be used for the estimation of the European aggregates due to the evolving national methodology of registering bankruptcy declarations.
The EU aggregates are calculated by weighting the national indices by the number of active enterprises, taken from structural business statistics of the reference year 2015. Even if the data of some EU countries are still missing, the estimates of the European aggregates are nevertheless based on more than 75 % of the total Europe (in terms of weights). Missing data of the countries that have provided data at least for the period 2015 – 2019 have been estimated using an ARIMA forecast in JDemetra+ software. Countries that have not provided data for the year 2015 have been excluded from the EU aggregates.
In this publication, the seasonally adjusted EU series are calculated indirectly by calculating the weighted average of the available seasonally adjusted national indices.
Context
Monitoring registrations and bankruptcies on a quarterly basis is useful as it provides more up-to-date and frequent information on the economic environment for businesses than the traditional annual business demography statistics. Quarterly data is very helpful to track better the effects of the COVID-19 pandemic in 2020 and 2021, and the impact of Russia's invasion of Ukraine on European businesses. This is particularly important for policy makers when policy responses are needed due to business cycle developments in the current context.
Since the first quarter of 2021, the data on the absolute numbers of registrations of new businesses and bankruptcies are provided by the national statistical institutes of the EU Member States, on a mandatory basis in accordance with the provisions of Regulation (EU) No 2019/2152 on European business statistics.
Direct access to
Other articles
Dedicated section
- Business registration and bankruptcy index (sts_rb)
Methodology
Legislation
- Regulation (EU) No 2019/2152 on European business statistics
- Summaries of EU legislation: European business statistics
- Regulation (EU) No 2020/1197 Commission Implementing Regulation (EU) 2020/1197 of 30 July 2020 laying down technical specifications and arrangements pursuant to Regulation (EU) 2019/2152 of the European Parliament and of the Council on European business statistics.