Europe's ambitious attempt to regulate artificial intelligence is caught in the crossfire. While the EU AI Act formally came into force in 2024, an intense tug-of-war is now underway over how strict the requirements should actually be in practice. According to EUobserver, pressure groups linked to large tech companies are driving the demands for simplification — and Brussels seems to be listening.

Simplification or Dilution?

Proponents of a more “innovation-friendly” regulatory framework argue that the AI Act in its current form will stifle European technology development. An open letter signed by over 30 European founders and venture capital leaders has called for an implementation pause, on the grounds that only “well-defined actors with large resources can afford to meet the compliance requirements,” according to the collected research material.

CEOs from European heavyweights like ASML and Siemens have also advocated for simplification, pointing out that more than three years after what is referred to as the “ChatGPT moment,” Europe is still discussing regulation, while the rest of the world has moved on to scaling AI in physical systems and robotics.

But according to EUobserver, it is precisely this type of argumentation that worries democracy advocates and smaller players: It is the largest companies that have most significantly influenced governments' stance on simplification.

Behind the words about innovation-friendliness lies a demand for Big Tech to get away with more.
EU Waters Down AI Act: Norwegian Companies Squeezed Between Big Tech and EEA Rules - Bilde 1

High-Risk Classification: Far More Than Expected

One of the most concrete points of contention revolves around what is defined as “high-risk AI.” The European Commission originally estimated that between 5 and 15 percent of AI systems would fall into this category. Research and industry surveys paint a completely different picture.

33–50%
Share of startups' AI systems classified as high-risk
5–15%
Commission's original estimate

This gap is not just a technical point. High-risk status triggers requirements for risk analysis, data quality assurance, documentation, and human oversight — requirements that, according to Luboslava Uram, CTO of Solvd Group, are “particularly burdensome for startups and smaller providers” in sectors like insurance where the pace of innovation is high.

Norwegian Companies in an EEA Squeeze

Norway is not an EU member, but through the EEA Agreement, it is obliged to implement large parts of the EU's digital regulations. The AI Act will, in all likelihood, become part of the EEA Agreement, meaning that Norwegian companies selling products or services in the European market will have to comply with the same requirements as their German and French competitors.

The uncertainty surrounding what the “simplification” will actually entail creates a particular problem: Norwegian companies that have already begun to adapt to the regulations do not know whether they are doing too much — or too little.

While Brussels negotiates with itself, Norwegian AI startups await clarity they cannot afford to lose.

Fragmentation and Double Regulation

Criticism of the AI Act is not just about cost levels. There is also concern that the regulations overlap with already existing EU laws, and that different national authorities may interpret the same rules differently. MedTech Europe, for example, has pointed out that the requirements in the AI Act could double the requirements already found in medical device legislation, without necessarily providing better safety for patients.

The Information Technology Industry Council (ITI), for its part, has called for streamlining so that the regulations do not create “inconsistent national interpretations that fragment the internal market.”

The Draghi Report as a Backdrop

The political context of the debate is not insignificant. The so-called Draghi Report on EU competitiveness from 2024 already warned that too high a regulatory density can hinder investment and innovation in Europe. This has given new ammunition to those who want a more relaxed regulatory framework.

The question that remains is whether Brussels' “simplification” will make the regulations better for everyone — or just more comfortable for those who already have the resources to navigate complex regulatory frameworks. For Norwegian developers and founders, the answer is not indifferent.