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Red Tape Exemption For Start-Ups

The Government has declared a three year moratorium on compliance with new domestic regulation for small businesses and start-ups. The policy is part of a series of measures aimed at encouraging economic growth by reducing red tape. 

The moratorium applies to genuine start-ups and small businesses employing fewer than ten people, and will last until 31 March 2014. The effect of the policy is that the businesses to which it applies will be exempt from compliance with all new domestic regulation due to come into force from 1 April 2011 onwards until 31 March 2014. 

Unfortunately, the moratorium does not exempt any businesses from complying with European legislation. Because a large proportion of business regulation originates in Europe, the benefits of the moratorium will be limited in practice. In particular, businesses will not be exempt from new laws relating to maternity and paternity leave or agency workers. 

Even if you are considering taking advantage of the moratorium, it is important that managers keep up-to-date with changes in business regulation over the next three years to avoid being caught out when the moratorium ends. 

If you have any questions about how the moratorium or new regulations will affect your business, please speak to a member of our Corporate team.

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