ECOFIN - Economic and Financial Affairs Council

06/29/2026 | Press release | Distributed by Public on 06/29/2026 08:58

Artificial Intelligence: Council gives final green light to simplify and streamline rules 14:30 The Council gave its final green light on a new regulation aiming to streamline[...]

Today, the Council gave its final green light on a new regulation aiming to streamline and simplify certain rules regarding artificial intelligence (AI). The new law forms part of the so-called 'Omnibus VII' legislative package in the EU's simplification agenda.

With today's adoption, we are taking another decisive step towards a more competitive European Union. By providing greater legal certainty and ensuring a more harmonised implementation of AI rules across the EU, we are creating the conditions for innovation and growth to thrive in the single market. At the same time, by banning AI-generated or manipulated sexual deepfakes and AI-generated child sexual abuse material, we are sending a clear message that technological progress must always go hand in hand with the protection of our fundamental values.

This key deliverable under the 'One Europe, One Market' roadmap demonstrates that Europe can act with unity, ambition and speed, and is also a testament to the Cyprus presidency's commitment to turning strategic priorities into concrete results.

Marilena Raouna, Deputy Minister for European affairs of the Republic of Cyprus

The package includes proposals for two regulations aiming to simplify the EU's digital legislative framework and the implementation of harmonised rules on AI.

Application dates

Given that provisions on high-risk AI systems were due to enter into force on 2 August 2026, the co-legislators treated this part of the package with utmost priority and agreed on a fixed timeline for the delayed application of high-risk rules: the new application dates would be 2 December 2027 for stand-alone high-risk AI systems and 2 August 2028 for high-risk AI systems embedded in products.

Other key elements of the new regulation

The new law adds a new provision in the AI act, prohibiting AI practices regarding the generation of non-consensual sexual and intimate content or child sexual abuse material (CSAM). AI systems that generate nude images of real people or edit clothes out in existing photos to reveal intimate parts are set to be banned as of December this year.

The new regulation postpones the deadline for the establishment of AI regulatory sandboxes by competent authorities at national level until 2 August 2027 and reduces the grace period for providers to implement transparency solutions for artificially generated content from 6 months to 3 months, with the new deadline set on 2 December 2026.

The text also clarifies the competences of the AI Office for the supervision of AI systems based on general-purpose AI models where the model and that system are developed by the same provider by listing exceptions where national authorities remain competent, including law enforcement, border management, judicial authorities and financial institutions.

On the interplay of AI rules with sectoral legislation in sectors such as medical devices, toys, lifts and watercraft, the new law provides for a mechanism that allows to resolve situations in which sectoral law has similar AI-specific requirements to the AI act, by limiting the latter's application in those specific cases through implementing acts. This solution effectively addresses any possible overlaps between the high-risk requirements from the AI act and those from sectoral legislation.

The products covered by the machinery regulation were exempted from direct applicability of the AI act with the Commission empowered to adopt secondary legislation under the machinery regulation which would add health and safety requirements in respect to AI systems that are classified as high-risk pursuant to the AI act.

The regulation also adds a new obligation for the Commission to provide guidance to assist economic operators of high-risk AI systems covered by sectoral harmonisation legislation in complying with the high-risk requirements of the AI act in a manner that minimises compliance burden.

Next steps

The legislative act will be published in the EU's official journal shortly and will enter into force on the third day after this publication.

Background

In October 2024, the European Council called on all EU institutions, member states and stakeholders, as a matter of priority, to take work forward, notably in response to the challenges identified in the reports by Enrico Letta ('Much more than a market') and Mario Draghi ('The future of European competitiveness'). The Budapest declaration of 8 November 2024 subsequently called for 'launching a simplification revolution', by ensuring a clear, simple and smart regulatory framework for businesses and drastically reducing administrative, regulatory and reporting burdens, in particular for SMEs. Since February 2025, as a follow-up to the call by EU Leaders at that and subsequent meetings, the Commission has put forward ten 'Omnibus' packages aiming to simplify existing legislation on sustainability, investment, agriculture, small mid-caps, digitalisation and common specifications, defence readiness, chemical products, digital issues including on AI, environment, the automotive sector and food and feed safety.

ECOFIN - Economic and Financial Affairs Council published this content on June 29, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on June 29, 2026 at 14:59 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]