The pragmatic argument was that if you let the same experts who originally wrote it cut the law, they won’t budge one step from their positions. But there are no experts in this diplomatic group. When diplomats began opening up and scrapping complex laws on pesticide regulation or limits on chemicals in cosmetics, they ran into limits of their own.
“When EU countries made the decision that they wanted to simplify things, they didn’t take into account the possible impact on human health, and now they’re slowly starting to realize that,” an anonymous diplomat from the task force told Politico. Slovak member of the team Lukáš Bado added that “the group was not established to deal with such technical matters.”
In addition, the extreme time pressure exposed the national delegations to an unsustainable pace. Diplomats often have only two days to obtain expert opinions from their home ministries on hundreds of pages of proposed legislative changes. Domestic experts thus have no chance to realistically evaluate the impact of the changes. Negotiations are currently being pushed forward by the Cypriots as Ireland takes over the European Presidency in July 2026 with the ambitious goal of completing all packages by the end of the year.
Sustainability has fallen victim to compromise
At the beginning of autumn 2025, Ursula von der Leyen started pushing for reforms. “The established ruts are leading nowhere,” she said, calling on the European Parliament and the Council to quickly approve key reforms. She emphasized that only coordinated and urgent steps will ensure jobs, prosperity and independence for the future of Europe.
“Europe can unite around this agenda, but we must start acting knowing that time is pressing and our people expect us to take action and deliver results,” she concluded.
This frantic process has already brought its first victims in the form of a radical cutting down of the original European ambitions. This is best illustrated by the fate of the so-called Sustainability Omnibus. Although the pro-European coalition almost fell apart in the European Parliament in the fall of 2025, it was finally passed under the pressure of the industrial unions and has been in force since March 18, 2026.
The result? The scope of the rules has narrowed dramatically. Mandatory reporting on the impact of companies on the environment now applies only to giant companies with more than a thousand employees and a turnover of more than 450 million euros. However, much stricter limits were originally supposed to apply.
The Directive on Due Diligence of Companies in the Field of Human Rights and Environmental Studies was hit even harder. It was refocused exclusively on giants (over five thousand employees and a turnover of 1.5 billion euros) and its application was postponed until July 2029. Business is now anxiously waiting for June 2026, when at least simplified European standards for this reporting (ESRS standards) are to be adopted.
Surrender to artificial intelligence? Discounts for startups and a whip on deepfakes
The hot news from May 2026 is the preliminary agreement between the European Parliament and the Council of the EU on the so-called AI Omnibus package, which was supposed to simplify the rules for artificial intelligence. Although the negotiators celebrated the result, the reality is much more sobering. The resulting compromise has faced sharp criticism for a lack of ambition, and many experts warn that Brussels could have done much more for European companies, which are lost in the tangle of complicated regulations.
The biggest problem was the pressure to eliminate duplication in laws for sectors such as medical devices, toys and elevators. In the end, the result is more than modest: the overlapping rules have so far been resolved only for the engineering industry. In other sectors, problems will be solved later. Positive news for startups is the extension of discounts for companies with a turnover of up to 200 million euros. On the contrary, in response to the scandals, the rules for the creation of deepfake nudity will be tightened by December 2026. The other deadlines for risky AI are pushed to 2027 and 2028.
Can GDPR stop innovation?
As soon as the debates about AI subsided, attention immediately shifted to the second pillar of the reform – the Digital Omnibus, focused on working with data. Massive controversies are already raging around him these days. The Central European Chamber for AI, along with other associations, has already sent an open letter to the states warning against a too “diluted” proposal.
The industry fears that strict data protection is once again crowding out innovation. In particular, the fight is over the definition of anonymous data and exemptions for AI development. Without clear rules, there is a risk of chaos in laws across states, and confusing clicks on internet consents for people.
Geopolitical blackmail
This legislative chaos and the adoption of vague, hasty compromises sends a signal of disunity to the world, which is immediately exploited by outside players. The EU faces the most significant pressure from the United States, where Donald Trump’s administration is aggressively lobbying against European digital and green rules that hit American corporations. Washington has repeatedly threatened to impose new tariffs in retaliation.
In addition, the Americans went into battle with the strongest card: Europe’s energy dependence. Washington and Qatar have sent a joint open letter bordering on direct coercion, warning that if Brussels insists on excessively strict criteria for imported liquefied natural gas (LNG) as part of its environmental rules, it could threaten the continuity of energy supplies for European industry.
How far can the EU retreat?
Although the EU has an Anti-Coercion Instrument to defend against economic blackmail, its weakness is evident in practice. If external threats combine with internal pressure from European companies, the position of the Union weakens. The first concessions are already a reality, as the EU has already pledged in trade agreements that its green standards will not constitute an “unreasonable obstacle” to transatlantic trade.
In May 2026, it seems that although the process of simplifying European law is progressing, the resulting compromises are vague, unconceptual and instead of stability, they only bring another wave of uncertainty to the business environment. Bureaucracy reduction has in many ways become a mere political substitute for the lack of a real economic vision of Europe.
