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One might have been excused for believing that the European project of regulatory supervision, or of regulatory governance, was unstoppable (OECD (2022), Better Regulation Practices across the European Union 2022, OECD Publishing, Paris, https://doi.org/10.1787/6e4b095d-en. ). In the economic sector, the approach was grounded in a framework in which the State would serve as a source of policy and objectives the realization of which would be delegated to enterprises in the form of compliance and reporting requirements. Compliance would be the product of the work of large interlocking bureaucracies in constant communication--one lodged in and as the state apparatus, the other developed within the institutional apparatus of the complying enterprise.
A key trend driving regulatory evolution is the growing demand for evidence-based compliance. As highlighted in recent discussions, EU regulations are increasingly requiring organizations to not only implement policies but also provide auditable, documented proof of compliance. This shift moves compliance beyond check-the-box exercises to defensible, data-driven processes that regulators can scrutinize. (here)
The result was an increasingly comprehensive and complex system of administrative supervision; one in which enterprises might, to some at least, appear to serve as the privatized organs of public administration of state policies and objectives. As a privatized public body their principal objective was to serve as an instrument of state policy, to be undertaken in the course of pursuing economic or commercial objectives. The approach was comprehensive but especially notable in the business and human rights and sustainability areas through the European Green Deal.
The push back was manifested in the form of Mario Draghi
Mario Draghi – former European Central Bank President and one of Europe's great economic minds – was tasked by the European Commission to prepare a report of his personal vision on the future of European competitiveness. The report looks at the challenges faced by the industry and companies in the Single Market. It outlines how Europe will no longer be able to rely on many of the factors that have supported growth in the past and lays out a clear diagnosis and provides concrete recommendations to put Europe onto a different trajectory. (here)
The substance of the Draghi Report, supported in some measure by the European Commission resulted in the intensification of efforts to roll back, slow down, or reduce the net effects of projects of regulatory governance, now balanced by issues of efficiency and competitiveness.
On 26 February 2025, the European Commission adopted a simplification package. It covers a number of legislative areas, including sustainable finance rules, carbon border adjustment mechanism and investment with the aim of simplifying EU rules, enhancing competitiveness and attracting investment. This initiative is part of the Commission’s commitment to reduce administrative burdens by 25% for all businesses and 35% for SMEs. In order to boost competitiveness and unleash growth, the EU needs to foster a favourable business environment and ensure that companies are not stifled by an excessive regulatory burden. This, in turn, will unlock investments and enable companies to embrace the transition to a sustainable economy in a more effective and pragmatic way, ultimately meeting our climate and other sustainability goals. The “Omnibus” package will reduce compliance complexities for all companies, while focusing the rules on the largest companies that have a bigger impact on the environment and climate. (here)
Simplification has now come to the regulatory governance of A.I. The European Commission has distributed a Press Release Commission collects feedback to simplify rules on data, cybersecurity and artificial intelligence in the upcoming Digital Omnibus.
The European Commission has opened a call for evidence to collect research and best practices on how to simplify its legislation in the upcoming Digital Omnibus, especially when it comes to data, cybersecurity and artificial intelligence (AI). This is fully in line with the Commission’s simplification agenda and efforts to create a more favourable business environment, by lightening administrative burdens and costs on companies. The initiative also supports the Commission’s target in the Competitiveness Compass to cut administrative burden by at least 25% for all companies and at least 35% for small and medium-sized enterprises. * * * This call for evidence follows extensive stakeholder engagement that included public consultations on the Data Union Strategy, the Cybersecurity Act revision, and on the Apply AI Strategy. It is a first step in simplifying the EU’s digital rulebook and remains open until 14 October 2025.
A Call for Evidence is a peculiarity of the EU lawmaking process. It is described this way:
The Commission uses Call for evidence to define the scope of: (1) a politically sensitive and/or important new law or policy (2) an evaluation of an existing law or (3) policy a fitness check of a bundle of related existing laws and/or policies. A Call for evidence describes the problem to be tackled and objectives to be met, explains why EU action is needed, outlines policy options and describes the main features of the consultation strategy, including whether a public consultation with a questionnaire is needed. The Call for evidence combines two steps that were previously sequential: the roadmap/inception impact assessment and the questionnaire (where relevant). (EU Commission, Planning and Proposing Law).
But in the case of the AI Act, simplification does not appear to also suggest a pause in its enforcement. As recently reported:
According to Cynthia Kroet from Euronews, the European Commission has rejected calls to pause the AI Act’s implementation, with Commission official Yvo Volman confirming to EU lawmakers that no moratorium is being considered. Speaking to the European Parliament’s LIBE Committee, Volman emphasised that the focus remains on making the rules work practically. He also clarified that the upcoming digital simplification package, due in December, won’t involve a complete overhaul of the AI Act, addressing concerns about potential US pressure influencing changes. (The EU AI Act Newsletter #87: Digital Simplification Consultation Launches).
Of interest may be the Draft Guidance article 73 AI Act - incident reporting (Download); Incident report for serious incidents under the AI Act (High-risk AI systems) (Download). "While the rules will only become applicable from August 2026, you can already download the draft guidance and reporting template below. Both these documents will help providers to prepare. The draft guidance clarifies definitions, offers practical examples, and explains how the new rules relate to other legal obligations. The EU’s approach also seeks alignment with international initiatives, such as the OECD’s AI Incidents Monitor and Common Reporting Framework." (here).
All of this suggests a conversation rather than a retreat. There is no going back to wherever it was that European governance had been in the 1970s, or 1980's, or thereafter in that short effervescent period that produced both a theory of regulatory governance (including its financial sector version as regulatory supervision, though the two align in fundamental respects). But going forward, the calculus of regulatory governance will likely be encumbered (or blessed--depending on one's ideological starting point respecting the roles and responsibilities of states, markets, and the bodies corporate through which they are manifested), by an additional set of factors that, added to the calculus of regulatory governance, may reshape its outcomes and the expectations that drive those outcomes. It may be clearer now, and perhaps wiser, to indulge the foolishness of thinking that the European governance project will be abandoned--it will not. But perhaps it will be enriched by the incorporation of factors that had, until now, been marginalized from the analytics of European welfare, and in the process continue the development of European governance theory with strong foundations in liberal democracy and the autonomy of the individual within it.
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