The European Commission on Wednesday unveiled new proposals to ease regulations on AI and data privacy.

The EU has for years sought to rein in tech companies on various issues, but is also attempting to balance this with the need to compete with tech firms in the United States and East Asia.

Europe 'failing to keep up' in tech race — Commissioner

"Europe has not so far reaped the full benefits of the digital revolution," EU economy commissioner Valdis Dombrovskis said.

"And we cannot afford to pay the price for failing to keep up with demands of the changing world," he stressed.

"By simplifying rules, reducing administrative burdens, and introducing more flexible and proportionate rules, we will continue delivering on our commitment to give EU businesses more space to innovate and grow," he said, adding that the bloc needed to "close the innovation gap."

"Our rules should not be a burden but the added value. For this, we need immediate steps to get rid of regulatory clutter," EU technology commissioner Henna Virkkunen told reporters in Brussels.

What regulations are to be simplified under the proposals?

The proposals unveiled on Wednesday included delaying stricter rules on the use of AI in "high-risk" areas until late 2027 and soften rules on the use of cookies.

The areas that were considered high-risk included biometric identification, utilities supply, health, creditworthiness and law enforcement.

The EU executive also seeks to establish when data is no longer considered "personal" under privacy law, which could potentially pave the way for firms to use anonymous data from people in the EU for AI training.

Many companies, including the Berlin-based multinational tech conglomerate Siemens and the software company SAP, which is based in southwestern Germany, have requested an easing of AI regulations in the EU.

Proposals could lead to less cookie consent banners on websites

The Commission's proposals also include changes to the General Data Protection Regulation (GDPR), which was put in place in 2018.

The law obliges operators of digital platforms to obtain consent from users before processing personal data.

Under the proposed changes, cookie consent banners would appear less frequently on websites and some digital activities would no longer require consent.

What is the criticism of the proposals?

Meanwhile, critics have accused the Commission of caving in to big tech.

"This is the biggest attack on Europeans' digital rights in years. When the commission states that it 'maintains the highest standards', it clearly is incorrect," Austrian privacy activist Max Schrems said was cited by AFP news agency as saying.

The centrist bloc in the EU Parliament said it supported efforts to "modernize" regulations, while also expressing concern.

"Simplification cannot come at the expense of the safeguards that protect Europeans' privacy, data and fundamental rights," the bloc said.

Edited by: Wesley Rahn