EU businesses want a pause on AI regulations so they can cope with unregulated Big Tech players

French AI business Mistral on Thursday announced an initiative called "AI for Citizens," which it says offers a way to work with governments and public institutions to transform public services using AI.

"It's clear that artificial intelligence will have significant and lasting impact not only on companies, but also on governments and societies," Mistral said.

"However, in the rush to attempt to put AI to use, it all too often seems that AI is something that happens to people and countries, an inevitability beyond their influence that leaves them at the mercy of closed, opaque systems designed and operated by distant, behemoth corporations."

We can't say for certain which distant, behemoth corporations Mistral means, but the list is likely to include American tech brats Amazon, Google, Meta, and Microsoft, along with OpenAI and Anthropic.

The French AI biz unveiled AI for Citizens - which again is focused not on citizens but on "States and public institutions" - a day after joining a group of around 50 European companies and organizations seeking a delay in the implementation of the EU's AI Act.

The Act aims "to make sure that AI systems used in the EU are safe, transparent, traceable, non-discriminatory and environmentally friendly." Some of its provisions came into force as of August 1, 2024, but most don't apply until August 2, 2026.

The Act applies regulations matched to risk levels and therefore bans real-time facial recognition in public places as that's felt to be an unacceptably risk practice. It also imposes data governance and risk management requirements on high risk systems, but demands lesser transparency requirements for less risky AI systems.

When the AI Act was unveiled, World Economic Forum contributor Dionys Gragousian, director of AI Governance & Sustainability at startup DataRobot, suggested the AI Act "actually has teeth" due to the size of potential fines it allows. In time, those teeth became less apparent as regulators adjusted the law after industry lobbying.

The latest call to defang the regulatory regime comes in the form of an open letter from the EU AI Champions Initiative, a coalition of more than 60 organizations that launched in February 2025. The group presently claims to represent over 110 organizations with a total market capitalization of more than $3 trillion that together account for over 3.7 million jobs across Europe.

Around 50 of these Champions - Mistral, Airbus, ASML, Publicis, and Siemens Energy, among others - on Wednesday published a note urging EU leaders to delay the enforcement of the AI Act by two years for the sake of European competitiveness.

"This postponement, coupled with a commitment to prioritize regulatory quality over speed, would send innovators and investors around the world a strong signal that Europe is serious about its simplification and competitiveness agenda," the letter states.

"In the context of the broader review of EU digital rules you have announced, it would also create the room needed to develop an innovation-friendly implementation strategy and identify pragmatic avenues for regulatory simplification, covering both GPAI [general purpose AI] models and high-risk AI systems as well as broader digital regulations."

Advocacy group Corporate Observatory Europe panned the EU AI Champions bid for halting enforcement of the AI Act.

"Delay. Pause. Deregulate. That is Big Tech's lobby playbook to fatally weaken rules that should protect us from biased and unfair AI systems," said Bram Vranken, Corporate Europe Observatory researcher and campaigner, in a statement.

"These risks are far from hypothetical. From Israeli mass surveillance and killings of Palestinians in Gaza, the dissemination of disinformation during elections, including by far-right groups and foreign governments, to the widespread use of biased and faulty AI systems in welfare programs, AI is already being used in countless risky and problematic ways."

American companies have also tried to convince US lawmakers not to regulate AI, by seeking a ten-year moratorium on state AI regulation. But the US Senate didn't cooperate. Now it's Europe's turn to balance economic ambition against civil society concerns about AI. ®