Brussels, 22/11/2005 (Agence Europe) - UEAPME, the employers' organisation representing the interests of crafts, trades and SMEs from the EU and accession countries, welcomes the 'general approach to reforming state aid rules, outlined by Competition Commissioner Neelie Kroes in September' (see EUROPE 9032): 'Channelling state aid away from uncompetitive industrial monoliths and towards promoting entrepreneurship and innovation in SMEs is a key step to putting the EU economy back on track. State aid in the EU must be targetted towards resolving the market failures that prevent innovation in small firms,' said Gerhard Huemer, UEAPME Director of Economic and Fiscal Policy, adding 'state aid must promote innovative businesses, not industrial dinosaurs.' The UEAPME says some fine-tuning is required. For example, the 'proposed state aid 'intensity' limit of 15% (for prototypes, etc) would be prohibitive for many small businesses, as the costs of applying for such funding would, in many cases, outweigh the benefits,' and 'a timeframe of 5 years for start-ups and new projects could be too short for certain sectors, like biotechnology, in which the fruits of innovation cannot be reaped right away.'