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16 June 2025 (Brussels, Belgium) -- The European Union’s rules to rein in artificial intelligence risks are barely a year old but they’ve already fallen out of favor. That was the big take-away from a series of internal meetings at the EU Commission last week as the Commission does a *rethink*. There is a large, ongoing Commission review of how to simplify all its digital rules, to be formally presented this December, but some of the cantankerous meetings are slipping out via sources we have.
This is being fueled by a new political climate and heavy lobbying from industry, an effort to revisit the carefully negotiated (but misguided) law. It is spurring warnings from safety campaigners who are being sidelined and overpowered by AI industry groups who say it will undermine investment in Europe.
Note: Mistral AI, the French company regarded as one of France’s most promising tech startups and is arguably the only European company that could compete with OpenAI, had to partner with Microsoft to expand its presence in the artificial intelligence industry because no EU-based investment firm/VC had the necessary capital or bandwidth.
When the bloc’s AI rules were first agreed, EU officials and legislators celebrated a multi-year effort to set a global standard designed to keep humanity safe from dangerous tech. But then they had to quickly modify the Act before its formal release when ChatGPT reared its head on November 2022.
Now, the focus has shifted from safety to catching up with American and Chinese companies who are leading the AI race, at an exponential pace. The EU's prized AI rulebook will now need to be *tweaked* as part of a push in Brussels to simplify laws and reduce requirements on businesses, and actually try to be competitive. Said one Commission insider:
"Forget all that crap about "the Brussels Effect". That is dead. We are getting killed in a marketplace where we can offer no competition".
While digital rights campaigners warn the change of heart could see technological catastrophe come true, industry is pissed off about the indecision. Said the CEO of one major EU group:
“If you actually want to impose something, then impose it. If you want to stop the clock, let’s stop the clock. BUT DECIDE!! Stop waffling!! People want to be very certain of what is going on. We have businesses to run. One again the Commission demonstrates it has zero understanding of what is happening in the real commercial world. It is so frustrating".
Dutch Greens’ lawmaker Kim van Sparrentak, who is an advocate of simply enforcing the existing law that she herself helped negotiate, warned about "the potential brake" on the adoption of technology at a time when only 13% of companies in Europe are estimated to properly use AI under the Act:
“As long as we don’t have an AI Act that is being enforced, we keep systems on the market of which you don’t know whether these function well or if these are safe. That to me is essential if we want to ensure that a lot of companies start using AI safely".
That’s in contrast to the Big Tech industry backed by the U.S. government, which argues a delay - at a minimum - in any AI regulation is vital to give the industry the time it needs to comply with tectonic shifts in technology. The U.S. argument is that postponement is essential to give companies enough time to prepare, and understand the exponential changes underway.
And obviously Big Tech companies in January gained a powerful ally in the White House as Donald Trump's administration has pushed back against any potential enforcement of the EU’s Artificial Intelligence Act.
Yet many in the EU were surprised when the European Commission’s tech sovereignty chief Henna Virkkunen this month opened the door to "pausing the roll-out of the law". While the EU rulebook became law in August 2024, it only takes effect gradually: some AI practices were prohibited as of February 2025, but the more substantive parts of the new laws against high-risk AI applications will only take effect in 2026 or 2027.
Now, that 2026/2027 timeline is expected to be put on "pause mode" as Virkkunen told EU ministers in Luxembourg on June 6th:
“If we see that the standards and guidelines are not ready in time, due to commercial considerations, we should not rule out postponing some parts of the AI Act".
For the European AI industry - in fact all EU industries - there has been a sigh of relief.
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