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Explainer-Will the EU delay enforcing its AI Act?
Published by Global Banking & Finance Review®
Posted on July 3, 2025
3 min readLast updated: January 23, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on July 3, 2025
3 min readLast updated: January 23, 2026
The EU's AI Act may face delays as tech companies call for a pause due to compliance challenges and lack of guidelines. The European Commission has yet to decide.
By Supantha Mukherjee
STOCKHOLM (Reuters) -With less than a month to go before parts of the European Union's AI Act come into force, companies are calling for a pause in the provisions and getting support from some politicians.
Groups representing big U.S. tech companies such as Google owner Alphabet and Facebook owner Meta, and European companies such as Mistral and ASML have urged the European Commission to delay the AI Act by years.
WHAT IS THE AUGUST 2 DEADLINE?
Under the landmark act that was passed a year earlier after intense debate between EU countries, its provisions would come into effect in a staggered manner over several years.
Some important provisions, including rules for general purpose AI (GPAI) models, are due to apply on August 2.
GPAI, which includes foundation models like those made by Google, Mistral and OpenAI, will be subject to transparency requirements such as drawing up technical documentation, complying with EU copyright law and providing detailed summaries about the content used for algorithm training.
The companies will also need to test for bias, toxicity, and robustness before launching.
AI models classed as posing a systemic risk and high-impact GPAI will have to conduct model evaluations, assess and mitigate risks, conduct adversarial testing, report to the European Commission on serious incidents and provide information on their energy efficiency.
WHY DO COMPANIES WANT A PAUSE?
For AI companies, the enforcement of the act means additional costs for compliance. And for ones that make AI models, the requirements are tougher.
But companies are also unsure how to comply with the rules as there are no guidelines yet. The AI Code of Practice, a guidance document to help AI developers to comply with the act, missed its publication date of May 2.
"To address the uncertainty this situation is creating, we urge the Commission to propose a two-year 'clock-stop' on the AI Act before key obligations enter into force," said an open letter published on Thursday by a group of 45 European companies.
It also called for simplification of the new rules.
Another concern is that the act may stifle innovation, particularly in Europe where companies have smaller compliance teams than their U.S. counterparts.
WILL IT BE POSTPONED?
The European Commission has not yet commented on whether it will postpone the enforcement of the new rules in August.
However, EU tech chief Henna Virkkunen promised on Wednesday to publish the AI Code of Practice before next month.
Some political leaders, such as Swedish Prime Minister Ulf Kristersson, have also called the AI rules "confusing" and asked the EU to pause the act.
"A bold 'stop-the-clock' intervention is urgently needed to give AI developers and deployers legal certainty, as long as necessary standards remain unavailable or delayed," tech lobbying group CCIA Europe said.
The European Commission did not respond immediatelyt to requests for comment.
(Reporting by Supantha Mukherjee in Stockholm and Foo Yun Chee in Brussels. Editing by Mark Potter)
The provisions of the EU AI Act are set to come into effect on August 2, with some rules for general purpose AI models due to apply at that time.
Companies are concerned about the additional costs of compliance and the lack of clear guidelines, as the AI Code of Practice has not yet been published.
There are fears that enforcing the act may stifle innovation, especially in Europe where companies may have smaller compliance teams compared to their U.S. counterparts.
The European Commission has not yet commented on whether it will postpone the enforcement of the new rules, but EU tech chief Henna Virkkunen has promised to publish the AI Code of Practice soon.
Some political leaders, including Swedish Prime Minister Ulf Kristersson, have described the AI rules as 'confusing' and have called for a pause on the act.
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