Jan 26, 2026 – By Zenx News
The European Union has entered one of its most transformative governance periods since the Maastricht Treaty. With the new European Commission under President Ursula von der Leyen beginning its second mandate on 1 December 2025, a wave of landmark policies is now being implemented or finalised in the first quarter of 2026. From AI regulation and defence union to migration pact enforcement and the final phase of the Green Deal, Europe is simultaneously tightening sovereignty, deepening integration, and responding to geopolitical shocks.
Here are the biggest policy and governance developments defining Europe right now.
1. AI Act Fully Enters into Force – February 1, 2026
The world’s first comprehensive AI law becomes fully applicable on 1 February 2026 (24 months after entry into force in August 2024).
- Prohibited AI systems (social scoring, manipulative subliminal techniques, real-time remote biometric identification in public spaces by law enforcement except in strict cases) are now banned.
- High-risk AI systems (used in education, employment, critical infrastructure, law enforcement) must comply with strict requirements from August 2026, but registration in the EU database starts immediately.
- The European AI Office (established 2025) has already begun fining non-compliant companies; first penalties expected in Q2 2026.
- GPAI (General-Purpose AI) models such as Grok-4, Gemini-2, Claude-3.7 and Llama-4 now have to submit systemic risk assessments by May 2026.
2. European Defence Union Takes Shape – January 2026
Following the “ReArm Europe” summit in December 2025:
- The European Defence Industrial Strategy (EDIS) becomes operational with €150 billion in joint borrowing for defence procurement 2026–2030.
- The Readiness 2030 package mandates that by 2027, 60% of member states’ defence procurement must be European-made (up from current ~18%).
- First joint orders for air defence systems, drones, and artillery ammunition placed in January 2026 under the new European Defence Investment Programme (EDIP).
3. New Pact on Migration and Asylum – Full Implementation from June 2026
The controversial pact agreed in 2024 enters its final phase:
- Mandatory solidarity mechanism: countries refusing to take asylum seekers must pay €20,000 per person into the common fund.
- Border procedure accelerated to 12 weeks; new EU Asylum Agency staff deployment begins January 2026.
- Italy-Albania-style external processing deals now formally allowed under EU law.
4. Green Deal “Fit for 55” Final Sprint
- From 1 January 2026: CBAM (Carbon Border Adjustment Mechanism) fully applies to electricity, cement, steel, aluminium, fertilisers, and hydrogen.
- ETS-2 (buildings & road transport) starts July 2026 – carbon price on heating and fuel begins.
- 2035 ban on new CO₂-emitting cars is now irreversible after Germany withdrew its last-minute veto in December 2025.
5. Digital Euro Pilot Goes Live – January 2026
The ECB launches the live pilot phase of the digital euro in five euro-area countries (Germany, France, Italy, Spain, Netherlands). Citizens and businesses can now open digital euro wallets, with full launch planned for October 2027.
6. Rule of Law Conditionality Tightened
Following the December 2025 European Council:
- Hungary and Poland lose an additional €18 billion in cohesion funds for 2026 due to ongoing rule-of-law breaches.
- New “general conditionality” mechanism now also covers media freedom and judicial independence violations.
7. Enlargement & Ukraine/Moldova Fast-Track
- Accession negotiations with Ukraine and Moldova formally opened in December 2025.
- First negotiating clusters (Rule of Law & Public Administration Reform) scheduled to close by end of 2026.
- Western Balkans: Albania and North Macedonia move to Phase II in January 2026.
8. Fiscal Rules Return – But Reformed
The reformed Stability and Growth Pact enters into force on 1 January 2026:
- Debt-to-GDP above 90% must fall by 1% per year; 60–90% by 0.5% per year.
- New “European Semester” starts with submission of medium-term fiscal-structural plans by April 2026.
9. Foreign Policy & Global Gateway 2.0
- January 2026: EU imposes first sanctions under the new Anti-Coercion Instrument against Chinese companies involved in forced technology transfer.
- Global Gateway investment programme doubled to €300 billion for 2026–2032, with major focus on raw materials partnerships in Africa and Latin America.
Europe in early 2026 is no longer the “geopolitical dwarf” it was once called. With AI regulation leading the world, defence spending surging, climate laws biting, and enlargement back on track, the EU is executing the most ambitious governance overhaul in a generation — all while facing rising far-right governments in France, Italy, and the Netherlands.
The next 12 months will decide whether this new European sovereignty succeeds — or fractures under its own weight.