SME Definition

From 1st January 2007 

Small Enterprise

A Small Enterprise is defined as :

  • an enterprise that has fewer than 50 employees and has either an annual turnover and/or an annual Balance Sheet total not exceeding €10m


Medium Sized Enterprise

A Medium Sized Enterprise is defined as:

  • an enterprise that has between 50 employees and 249 employees and has either an annual turnover not exceeding €50m or an annual Balance Sheet total not exceeding €43m


In either case, if the enterprise is more than 25% owned by one or more enterprises or itself has a holding of more than 25% in any other enterprise, it will be necessary to consult the full definition in the Official Journal (see below).

Excluded from the holding company threshold in the above definition are public investment corporations, venture capital companies and institutional investors provided that they do not exercise control. However, an enterprise cannot be considered as meeting either definition if 25% or more of the capital or voting rights are directly or indirectly controlled, jointly or individually, by one or more public bodies.

Note - If a company is part of a group the employee, turnover, annual balance sheet and ownership limits apply to the group.


More Information

For the full definition, see the “Official Journal of the European Commission (L 124/36) 20th May 2003 – Commission Recommendation of 6th May 2003 concerning the definition of micro, small and medium-sized enterprises” (PDF Format).

Click here to download the SME Definition - User Guide and model declaration brochure, publishd by the European Commission