EU Unveils Package to Boost AI Start-ups and SMEs

Written by Jeremy Werner

Jeremy is an experienced journalist, skilled communicator, and constant learner with a passion for storytelling and a track record of crafting compelling narratives. He has a diverse background in broadcast journalism, AI, public relations, data science, and social media management.
Posted on 01/30/2024
In News

UPDATE – FEBRUARY 2026:

the EU’s AI regulatory and innovation framework has moved deeper into implementation. The EU AI Act’s rules for general-purpose AI (GPAI) models took effect on August 2, 2025, requiring providers to comply with transparency, documentation, and risk management obligations, including disclosure of training data practices and restrictions on the use of pirated content. Full enforcement authority, including fines for GPAI non-compliance, will apply beginning August 2, 2026. GPAI models placed on the market before August 2025 have until August 2, 2027, to achieve compliance.

In November 2025, the European Commission proposed targeted amendments to adjust certain timelines for high-risk AI obligations and reduce administrative burdens on SMEs, aiming to preserve competitiveness while maintaining the Act’s risk-based framework. Core prohibitions on unacceptable-risk AI, which became enforceable on February 2, 2025, remain unchanged.

The AI Office continues coordinating implementation, particularly around GPAI supervision and cross-border consistency. Complementary ecosystem initiatives remain active: AI Factories and EuroHPC supercomputing infrastructure are expanding developer access; GenAI4EU is supporting sectoral deployments; ALT-EDIC and CitiVERSE EDIC are progressing; and over €4 billion in Horizon Europe and Digital Europe funding continues flowing to startups and SMEs. A January 2026 funding round of more than €300 million further reinforced the EU’s push to scale trustworthy AI innovation.

While enforcement structures are now operational, practical challenges remain around GPAI oversight, high-risk system compliance readiness, and SME support—making 2026 a pivotal year for both regulatory scrutiny and ecosystem growth.


ORIGINAL NEWS POST:

How the EU Is Supporting Trustworthy AI Development in 2025

As the EU AI Act moved toward final adoption, the European Commission introduced a package of initiatives to strengthen Europe’s AI innovation ecosystem. Announced on January 24, 2024, the package is designed to support startups and SMEs developing trustworthy AI aligned with EU values and regulatory expectations.

Key Initiatives

  • AI Factories via EuroHPC amendments, enabling:
    • Dedicated AI supercomputers for model training
    • Developer access for startups and SMEs
    • Supercomputing programming support and services
    • Sector-specific AI applications (e.g., climate, manufacturing, virtual environments)
  • Creation of an AI Office within the Commission to coordinate AI policy and oversee implementation of the EU AI Act, including supervision of general-purpose AI.
  • EU AI Startup & Innovation Communication, outlining:
    • €4 billion in funding through Horizon Europe and Digital Europe
    • Expansion of EU AI talent pipelines
    • Public/private investment initiatives
    • Scaling of EU Common Data Spaces
    • Launch of GenAI4EU to support use cases across 14 industrial ecosystems
  • Two European Digital Infrastructure Consortia (EDICs) with Member State participation:
    • ALT-EDIC to advance EU language technologies
    • CitiVERSE EDIC for city digital twins and urban optimization

The AI Office

The Commission also adopted a strategy outlining its approach to using trustworthy and ethical AI internally. Member States will establish the ALT-EDIC and CitiVERSE initiatives with Commission support as EuroHPC amendments move through Parliament and Council review.

Need Help?

If you have questions about how evolving AI regulations may affect your organization, consider reaching out to BABL AI. Our audit experts provide independent guidance on compliance, governance, and responsible AI deployment.

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