This article was first published in EFAMA's Fact Book 2026.
In this uncertain geopolitical landscape, technological innovation will be a fundamental enabler for the EU's strategic priorities. Namely, upholding a free, secure, and democratic Europe that delivers prosperity to its citizens. Simultaneously, Europe’s innovation potential will only be realised if its political leadership matches the pace and adaptability of its innovators.
In this context, the European Commission has tabled the Digital Omnibus, comprising two separate but interrelated legislative proposals to simplify the EU Digital Rulebook: the Digital Omnibus on AI and the Digital Omnibus on Data and Cybersecurity. A key focus of this initiative lies in its implications for the rules governing the development and deployment of artificial intelligence (AI), a critical technology for Europe’s global competitiveness.
On one hand, the Digital Omnibus on AI proposes targeted changes to the EU AI Act. Most notably, it introduces a ‘stop the clock’ measure that would delay the application of rules on high-risk AI systems, currently set to take effect in August 2026. This would be a positive outcome from this process, given that firms across all markets need additional time to build awareness and better prepare for compliance with the EU AI Act, and most requirements under the Act’s risk-based framework apply specifically to these types of AI systems.
Meanwhile, the Digital Omnibus on Data and Cybersecurity, which is treated as a separate file in this legislative process, proposes changes to a broad range of EU digital legislation. For instance, the proposal introduces targeted changes to the General Data Protection Regulation (GDPR) with direct implications for the rules governing the use of AI. Some of these changes are indeed welcome, such as the confirmation under the revised GDPR text that processing of personal data in the context of the development and operation of AI may qualify as legitimate interest.
Overall, the changes proposed under the Digital Omnibus are targeted and carefully calibrated. While they provide useful clarifications and reduce administrative burden to some degree, they are unlikely to fundamentally change how most firms operate. Asset managers already function within a highly regulated environment, with robust governance frameworks in place to ensure investor protection and mitigate risks. As such, the Omnibus is unlikely, on its own, to trigger a meaningful wave of AI-driven innovation across Europe.
It is therefore more appropriate to view the Digital Omnibus as a first test of the EU’s ability to align regulatory simplification with its broader ambition to lead in AI. Demonstrating both the political will and capacity to take these initial steps is essential to moving the agenda forward. In this sense, the Omnibus should be seen as part of a broader trajectory, where the real opportunity lies in future initiatives that more decisively enhance the agility and innovation capacity of EU businesses.
This will be particularly important in the context of the Digital Fitness Check – the European Commission’s comprehensive review of the EU digital rulebook to assess its effectiveness and identify areas for simplification – whose outcomes, expected in early 2027, will be decisive in determining whether the EU moves beyond incremental adjustments towards more structural reforms that can truly enable AI-driven innovation across sectors such as financial services.
Author: Franco Luciano
