Dozens of Europe’s leading startups and investors have called on the EU to pause the rollout of its wide-sweeping AI Act.
The bloc has faced mounting pressure to rework the law, which officially came into force in 2024 but is being rolled out in stages over two years, with high-stakes talks over how the rulebook will actually be enforced still ongoing.
“A well-calibrated pause does not equate to delay for delay’s sake. It’s about delivering a workable implementation plan — not a rushed ticking time bomb — that reinforces Europe’s credibility and competitiveness on the global stage,” the letter reads.
Johannes Schildt, founder and former CEO of Stockholm-based healthtech Kry, began drafting the letter last week, shortly after Swedish prime minister Ulf Kristersson broke rank with EU leaders by demanding the bloc freeze plans to enforce the rules, citing risks to technological progress.
Schildt tells Sifted he was inspired by Kristersson’s stand and within days had drafted his own letter — published exclusively in Sifted — and gathered the support of close to 30 industry leaders, including Lovable cofounder Anton Osika and 20VC founder and podcaster Harry Stebbings.
Julia Elf, cofounder of Schildt’s new venture Elfcare, tells Sifted the current wording of the Act “puts a lot of pressure on startups” which may not have the resources needed to comply with the rules.
“Pushing ahead as-is could really hurt Europe’s AI ecosystem. Startups may move elsewhere, or investors may start avoiding European companies because of the extra risk,” Elf tells Sifted.
“The bigger players will probably be fine because they can afford costly compliance and legal functions, but we’ll see less innovation and more concentration. That’s not good for competition or for Europe’s role in global AI.”
Fellow signatories include Voi CEO Fredrik Hjelm, Synthesia COO Steffen Tjerrild, Legora CEO Max Junestrand and Judith Dada, general partner at Visionaries Club.
Kitty Mayo, CEO of industry body Project Europe, also signed the letter. She tells Sifted: “It seems ludicrous to pass an act that would meaningfully harm European companies’ ability to be competitive in Europe, let alone globally.”
Behind the scenes, industry leaders and other experts have been wrangling with politicians over the wording of a “code of practice” designed to establish how the rules will apply to generative AI. A final draft is set to be presented to key stakeholders on Wednesday, even though the relevant rules are expected to come into force in a matter of weeks.
“Without a harmonised baseline, each member state will be forced to interpret and enforce divergent rules, splintering the single market and erected costly compliance walls,” says Alexandru Voica, head of corporate affairs and policy at Synthesia.
Sifted approached the European Commission for comment.
Read the orginal article: https://sifted.eu/articles/ai-act-news-startups-vcs-europe-pause-letter/
