The European Union may reduce digital regulation, with the goal of boosting local technology companies. The EU has lagged behind in AI investments, and has been known for restrictive regulations on site usage, under the GDPR regulation.
The EU will now submit its Digital Omnibus to the European Parliament and the Council. The simplification agenda will continue with a consultation period, the Digital Fitness Check, open until March 11, 2026.
As Cryptopolitan reported earlier, critics of the potential changes have suggested Brussels may undermine privacy in its bid to grow the AI sector.
The EU to delay ruling on AI systems
The main fear is that the EU may delay the growth of AI by placing too strict regulations on new AI systems. The current proposal is to grant a grace period of 16 months before considering restrictions.
The new regulations will streamline the reporting of cybersecurity incidents. The most contentious point is the easing of data protection regulations to accelerate and facilitate the training of AI models.
The EU Commission aims for generally simpler rules, doing away with previous over-reaching and poorly defined digital regulations.
The Commission presented its digital omnibus, easing both access to data and the business side of operating a company in the EU.
‘By cutting red tape, simplifying EU laws, opening access to data and introducing a common European Business Wallet we are giving space for innovation to happen and to be marketed in Europe. This is being done in the European way: by making sure that fundamental rights of users remain fully protected,’ said Henna Virkkunen, Executive Vice-President for Tech Sovereignty, Security and Democracy.
EU companies are shifting to automated administration, digitizing tasks that are currently done in person.
The proposal will still need the approval of European governments to come into force. The EU has extended its string of deregulation attempts as the region tries to catch up with digital growth.
‘Closing the innovation gap and cutting red tape are key drivers to boost the EU’s productivity. Our Digital Omnibus seeks to do both. Today’s proposal represents an important first step in our digital simplification agenda, aiming to create a more favourable business environment for European companies,’ said Valdis Dombrovskis, Commissioner for Economy and Productivity, Implementation and Simplification.
EU to boost AI model training
Even if the digital omnibus deal fails, AI models will be able to expand in the EU without specific regulations. Restrictions are expected in August 2026, unless there are additional rules.
One of the main additions will be the Data Union Strategy, which will unlock high-quality data for AI training.
Digital companies will also have European Business Wallets with a single digital identity to simplify paperwork across the borders of EU member states.
For users, the rules will harmonize the existing GDPR, such as limiting the number of cookie banners. Users will be able to indicate their cookie preferences across central browser settings, avoiding the addition of cookie banners on each new site.
