Bureaucracy does not start and end with legislation: IVSH Bureaucracy Monitor reveals weaknesses throughout the regulatory chain
Companies award new EU rules just 2.29 out of 10 points for practical applicability. Late guidance, unclear evidence requirements and additional supply-chain demands prevent effective relief.
Solingen, 2nd October 2026. Bureaucratic burdens are not caused solely by the number of legal requirements. A significant share of the administrative burden only develops on the path from a political decision to its practical implementation within a company. This is one of the central findings of the new IVSH Bureaucracy Monitor 2026.
The survey shows how late guidance, unclear terminology, a lack of standard templates, parallel data systems and additional demands from customers and platforms multiply the burden on companies.
A total of 87 percent of the companies surveyed rate their current bureaucratic burden as high or very high. Some 97 percent report an increase in bureaucracy-related costs, while 74 percent feel that bureaucracy severely or very severely restricts their entrepreneurial activities. The displacement effect is particularly significant: 92 percent state that bureaucratic requirements leave them with less time for their core business, customer orders, product development or innovation.
Regulation has been adopted, but is not yet ready for implementation
A central new finding of the Bureaucracy Monitor concerns the practical applicability/practicability of European regulation. Companies award new or amended EU rules an average score of just 2.29 out of 10 points for practical applicability. A total of 84 percent award no more than three points, and no response exceeds five points. Transition periods receive an average score of only 2.76 out of 10 points.
The IVSH does not regard these findings as an argument against necessary standards for consumer, environmental or product protection. Instead, the results reveal a gap between the political objective and the practical requirements for implementation.
A regulation may already have been adopted while essential definitions, binding interpretation guidance, testing methods, data formats or digital systems are still unavailable. For companies, the transition period therefore often begins before legally secure implementation is even possible.
“Regulation must not be considered complete simply because it has been published in the Official Journal. It is only complete when companies and authorities can apply it with legal certainty, digitally and with proportionate effort. If guidance, technical systems and binding interpretations are only made available during the transition period, the time that companies can actually use for implementation is considerably shortened and avoidable duplication of work is created,” says Jan-Frederik Kremer, Director General of the IVSH.
The survey findings support this assessment. Some 87 percent of companies identify late or unclear guidance as a major implementation problem. A total of 89 percent report particular uncertainty regarding the scope of documentary evidence required. Furthermore, 84 percent want binding interpretation guidance, 82 percent want clear requirements for SMEs, and 71 percent call for recognised standard forms, templates and other standardised implementation tools.
Bureaucracy costs time, money and future opportunities
The impact extends far beyond conventional administrative costs. Based on the survey responses, the direct cost of bureaucracy in 2026 amounts to approximately 1.9 percent of annual turnover. This estimate includes costs that companies can directly attribute to bureaucracy, particularly personnel and working time, external advice, testing, fees and technical adjustments.
However, indirect consequences such as delayed product launches, postponed investments and missed market opportunities are not fully included. The actual economic impact is therefore greater than the reported cost share.
Some 37 percent of companies report spending at least ten hours per employee and month on bureaucratic tasks. The departments most frequently affected are administration at 92 percent, quality management and quality assurance at 66 percent, and sales at 61 percent. Bureaucracy is therefore no longer an isolated administrative function. It directly affects quality processes, product data, customer communication, supplier management and market access.
The most significant economic damage, however, results from the displacement of productive work. A total of 92 percent of companies report having less time for their core business, customer orders, product development or innovation. 79 percent observe frustration and a loss of motivation, while 71 percent report a reduction in operating results or margins. More than half of the companies surveyed cite higher product or process costs, and 45 percent see a decline in competitiveness.
Bureaucracy therefore ties up precisely the specialist and management capacities that companies need for product development, digitalisation, investment and the development of new markets.
“The true costs of bureaucracy do not appear in full on an invoice. They also become visible in products that reach the market later, investments that are postponed and innovation projects for which companies no longer have sufficient capacity in their day-to-day operations. Every unnecessary evidence and documentation loop ties up time, money and expertise that companies need for their future,” says Jan-Frederik Kremer.
Bureaucracy migrates into the supply chain
A particularly important development that has so far received too little attention in the wider debate is the migration of regulatory burdens into customer and supply chains.
Some 85 percent of companies experience additional demands from customers or other market participants at least occasionally. A total of 55 percent regard the legal basis for these demands as rather or completely unclear. Almost one in two companies assesses the resulting burden as even greater than the burden caused directly by legal requirements.
In practice, supplier declarations, material data, test reports and sustainability information are frequently requested several times in different formats. A total of 61 percent report repeated data requests in varying formats. Some 53 percent receive requests for data even where they are supposed to benefit from an SME exemption, while 45 percent experience demands for which no recognisable legal basis exists.
This can undermine the effectiveness of political simplification measures. If a legal obligation for smaller companies is limited or removed, larger customers, platforms or certification systems may still request the same information through contracts, questionnaires or proprietary standards. The burden does not disappear. It merely shifts to another participant in the regulatory chain.
“An SME exemption on paper does not automatically provide relief in practice. If the same data is subsequently requested again by customers, platforms or certification systems, bureaucracy returns through the back door. In future, we must therefore not only examine new obligations, but also determine where burdens migrate within the regulatory chain,” says Jan-Frederik Kremer.
Medium-sized companies are under particular pressure
The Bureaucracy Monitor also challenges the simplified assumption that the smallest companies are always the most severely affected. The clearest burden pattern can be found among companies with between 50 and 249 employees.
In this group, 100 percent rate their current bureaucratic burden as high or very high. A total of 93 percent report a severe or very severe restriction of their entrepreneurial activities, while a further 93 percent frequently or very frequently experience EU rules as only partially implementable.
These companies are often internationally active, manage extensive product ranges and operate within complex supply chains. At the same time, they generally do not yet have the specialised legal, compliance, data and IT structures available to large corporations.
The IVSH therefore argues that SME assessments should not focus on formal employee or revenue thresholds. They should more take account of the breadth of the product range, the number of markets concerned, the complexity of supply chains and the availability of specialised internal resources.
From impact assessment to Regulatory Chain Control
Based on the findings, the IVSH proposes a fundamental change in the way regulation is assessed. Instead of evaluating rules only in abstract terms at the beginning of the legislative process, the entire regulatory chain should be subject to systematic control.
This chain includes the basic legal act, secondary legislation and guidance, technical standards, testing methods, digital systems, national procedures, supply-chain requirements and subsequent enforcement.
The IVSH proposes four key instruments:
1. Think Small First Gate with real SME testing
New requirements must be tested before their application using typical products, product ranges, supply chains and company processes. Critical findings must trigger simplifications, thresholds, standardised solutions or phased implementation.
2. Implementation Readiness Gate
Transition periods should only begin once the central definitions, secondary legislation, guidance, testing methods, data formats, portals and responsibilities of public authorities are complete, stable and available for practical use.
3. Burden Migration Test
Before and after a simplification measure, policymakers should examine whether obligations return through national procedures, platform rules, contracts, certification systems or customer questionnaires.
4. Binding ex-post impact measurement
Regulatory relief should only be recorded when companies can demonstrate that costs have fallen, time has been freed up and capacity has been restored for value creation, investment and innovation.
The IVSH also calls for the consistent application of the Once-Only principle. Product, packaging, material and conformity data should be recorded once in a structured format and then be legally reusable for different statutory purposes.
New digital systems and the Digital Product Passport will only provide genuine relief if they replace existing reporting requirements rather than creating an additional data layer alongside existing portals and systems.
Four practical cases reveal the same structural weakness
The Bureaucracy Monitor examines these challenges through four current regulatory cases: the EU commercial guarantee label, the Packaging and Packaging Waste Regulation, the General Product Safety Regulation and the new requirements for environmental claims under the Empowering Consumers Directive.
Although the subjects and objectives of these measures differ, all four cases reveal the same pattern: legal requirements, interpretation, technical tools, national procedures, existing stocks and real company processes are not sufficiently synchronised.
In the case of the EU commercial guarantee label, the labelling requirement encountered the practical reality of small products, unpackaged goods and densely stocked point-of-sale displays.
Under the Packaging and Packaging Waste Regulation, European requirements, national registration and reporting systems, and additional customer demands do not yet operate as a fully coherent system.
The General Product Safety Regulation creates discontinuities between physical and digital product information.
In the case of the Empowering Consumers Directive, unresolved interpretation and transition issues have prompted precautionary over-compliance and additional demands throughout supply chains.
These practical cases demonstrate that regulation must not be tested solely against an idealised individual product or standard business model. Before application, it must be tested under real conditions, including large product ranges, small products, existing stocks, international supply chains, different sales channels and the IT systems that companies actually use.
Not less protection, but better rules
The IVSH Bureaucracy Monitor does not question the political objectives of consumer, environmental, product or occupational protection regulation. Its central message is that regulation can only achieve these objectives if it is clear, proportionate, specified in good time and genuinely implementable under real business conditions.
“Cutting bureaucracy must not be confused with lowering necessary protection standards. Good regulation provides effective protection while remaining practical to implement. Our proposal is therefore clear: test rules before obligations apply across the market; clarify requirements before transition periods begin; reuse data instead of requesting it repeatedly; and only record regulatory relief when it can be measured within companies,” says Jan-Frederik Kremer.
The 2026 survey is based on responses from more than 80 percent of IVSH member companies. The participants include small and medium-sized companies from different employment and turnover categories, as well as larger businesses with national and international supply and sales structures.
A total of 55 percent of responses came from companies with between one and 49 employees, 39 percent from companies with between 50 and 249 employees, and 5 percent from larger companies. The results provide a descriptive picture of the predominantly SME-based German cutlery and housewares industry.
About IVSH
The German Association of Cutlery and Housewares Industries, IVSH, represents manufacturers of cutlery, flatware, cookware, kitchenware and household goods. The association monitors national and European regulatory initiatives and contributes the practical perspective of medium-sized industrial companies to political and regulatory processes.