“Better regulation”
The European Commission (EC) long ago established its own rules of the game for creating new regulations or amending existing ones. Through the so-called mechanism “better regulation”or better regulation, the EC aims to design simpler, clearer, and more transparent rules as a key factor in making Europe more competitive.
To achieve this objective, the EC has established a platform system to collect opinions and proposals from all stakeholders—citizens, businesses, and everyone else—from the initial conceptual stage of drafting a new regulation to the preparation of detailed analyses, impact assessments, and subsequent public consultations.
In short, it is a lengthy process that emphasizes transparency, openness, and the involvement of all interested individuals or organizations in the legislative process. The duration of the entire process to arrive at new European regulations is measured in months and years rather than weeks.
It is interesting to note that the EC received 879 opinions and suggestionson the proposal to introduce the so-called 28th regime or to establish harmonized rules for a single European economic society, demonstrating that inclusion and the opportunity to help shape rules in the EU are important to many individuals and organizations.
For anyone who wants to know more, I invite you to follow the “Have your say” website (orig. Have your say).
Omnibus
Encouraged by the publication of the now-famous and widely known Draghi reportLast year, however, the Commission took a different path. This document clearly highlighted the key challenges for Europe to become more competitive in today's rapidly changing global economy.
Among other things, it states that
“As many as 60% of businesses in the EU see the regulatory framework as a barrier to investment, with 55% of SMEs citing regulatory barriers and administrative burdens as a major challenge.”1
The report further highlights
“Regulatory barriers to expansion are particularly burdensome in the technology sector, especially for young companies.”
which, of course, is true. In particular, Mario Draghi's report highlights the need to simplify the European regulatory framework, while at the same time providing a uniform methodology within the EU for assessing the effects and costs of new regulations.
The EC has therefore decided to take a new approach to changing the legal rules of the game, through the adoption of so-called omnibuses — a single legal act that modifies several individual, separate EU legal acts for a specific area, all with the aim of regulatory simplification. We often hear, but also feel, the re-regulation of the EU. For example, investment simplification packages were already adopted last year, and in the area of sustainability (text adopted amending the CSRD and CSDDD Directives), a third package including measures for SMEs and the removal of documentation requirements (partially adopted).
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1The report of M. Draghi, pp. 20, 32, 68-69
New package for digitalisation and artificial intelligence
As already mentioned, the adoption of EU legislation is based on the principles of open dialogue, public consultations, impact assessments, coordination, and negotiations between the EC, the European Parliament, and the EU Council — in short, endless hours, days, weeks, and months to arrive at new European rules.
The basic rules were set by the EC itself, in the form of Better Regulation. These are respected as long as it is reasonable and appropriate. But there are also exceptions. And it is precisely these exceptions that have been increasingly prevalent since the beginning of the mandate of this EC. The reason lies in the now famous Draghi report and a clear message: The EU needs to deregulate, become more agile, responsive, and less bureaucratic, and reduce barriers for many businesses.
Thus, in the last year, we have been faced with the production of so-called omnibus packages, where several sectoral rules/acquis of the EU are amended by a single act. If this seems opportune and the only correct way to explain that it goes so fast, then this is not true of the second part of the Olympic saying — higher and stronger (better).
There are currently two omnibuses on the table in the EU, which are important in terms of content, omnibus for AI rulesin digital omnibus.
Omnibus — simplifications or even more legal confusion?
At STF, as an important expert interlocutor, we were invited to participate in the preparation of the draft position of Slovenia on the two proposed omnibuses.
There is little time for analysis, and for mutual consultation as well, but when one discovers the content, purpose, and dimensions of the proposed changes, other alarms go off.
Adoption is expected in a few months; EU member states have to form official positions within a few weeks — this is a real sprint.
We appreciate the efforts of all participants in this debate (ministries and other regulators in Slovenia), who responded and included representatives of the economy and civil society in the preparation of the position of the Republic of Slovenia, which is commendable. But we cannot shake the feeling of anxiety about the lightness of some Proposed changes2which, we can say, fundamentally change the rules of the game.
Therefore, at the STF, we did not even offer an opinion on certain amendments, as we believe it is important to draw attention primarily to this questionable practice of the EC, where it bypasses its own rules to draft new regulatory frameworks or modify existing ones.
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2Digital Omnibus — e.g., the proposed merger of data rules from the current four EU legislative acts into an amended Data Regulation (EU) 2023/2854 or a Single Data Act; changes to definitions in Regulation 2022/868 on European data governance, also relating to the processing of sensitive data; inclusion of the Directive on data in the Data Act; the definition (concept) of personal data as known by the GDPR changes; new definition of the purpose for the processing of personal data for scientific purposes.
Other responses
To show that we are not alone in these reflections, I would like to highlight the opinion of the Brussels think-tank BruegelA reputable and influential online media outlet Politicoin SOAPEuropean Association of Public Policy Experts.
But the most important thing is The report from the European Ombudsmanwhich notes a number of procedural irregularities in the way the Commission has drafted several legislative proposals it deemed urgent.
And when you discover that there are supposed to be 42 omnibuses in total, you have to wonder how we will ever navigate this legal maze. How will legal certainty be guaranteed to all entities? How will we be able to assess potential regulatory and business risks within companies and adequately protect our operations?
Omnibus — is it really a simplification or just more legal confusion?
The question therefore arises as to whether these are truly simplifications that will make our work and development easier and lower costs, or whether we are going to be caught between legally vague texts and the various articles and paragraphs of these directives and regulations.
So the question — real simplifications or even more confusion — is spot on, at least for now.
AUTHOR: Barbara Krajnc, Director of the Slovenian Technology Forum, GIZ
Cover photo source: © European Union / European Commission
