Source: Baker McKenzie

Baker McKenzie analyzes the European Commission's "Digital Package," a major three-part initiative released in late 2025 and discussed through January 2026 to modernize the EU's digital framework. The package includes the Digital Omnibus, the Data Union Strategy, and a proposal for European Business Wallets. A key highlight is the recalibration of the AI Act’s implementation timeline; high-risk AI obligations will now be tied to the availability of harmonized technical standards rather than fixed dates, potentially deferring compliance for up to 16 months for certain sectors. This pragmatic shift aims to prevent companies from being forced to comply before the necessary technical tools and guidance are fully established by the Commission.

Furthermore, the reforms introduce a single EU reporting interface for cybersecurity and data breaches, streamlining the requirements under NIS2, DORA, and GDPR. The Data Union Strategy seeks to facilitate AI development by establishing "data labs" and clarifying the legal basis for processing personal data in AI training. Additionally, the European Business Wallet will provide a secure digital identity for companies, facilitating seamless cross-border operations and regulatory filings within the single market. The package is currently under negotiation between the European Parliament and Council, with final adoption expected later in 2026. This comprehensive reform represents a significant effort to reduce administrative burdens while maintaining robust safety and privacy standards across the Union.