The von der Leyen II Commission -navigating a fragmented EU

The von der Leyen II Commission—navigating a fragmented EU 

Following intense negotiations and political manoeuvring, Ursula von der Leyen has secured approval for her College of Commissioners, originally unveiled in September 2024. Her team officially took office on 1 December and will now set about the difficult task of advancing the EU’s policy programme in a politically fragmented Commission and Parliament, requiring majorities to be built on every key initiative. 

The coalition that approved the von der Leyen II Commission reflects a diverse mix of Christian-Democrats (EPP), Socialists (S&D), Liberals (Renew), and Conservatives (ECR)—all of whom hold representation in the new College of Commissioners. On the fringes, most of the far-left and far-right groups voted against the new Commission. While many Green MEPs supported the appointment of von der Leyen for a second term as Commission President in July 2024, the Group was split 50-50 on supporting the new College—largely in protest against the inclusion of two members affiliated with hard- and far-right political groups.

What to expect in the first 100 days

The 2024-2029 policy programme will need to balance the ambitions and achievements of the previous Commission with boosting the EU’s competitiveness, as underlined in the Draghi report. This will involve navigating potentially conflicting aims, such as high regulatory standards while simplifying and streamlining business impact—potentially considering deregulation where necessary. The increasingly tense geopolitical context in which the EU finds itself is also expected to feed into the bloc’s approach in areas such as trade defence, extraterritoriality of sustainability requirements or indeed the treatment of digital platforms. 

The European Commission will publish its Annual Work Programme (WP) for 2025 on 11 February 2025, outlining flagship actions for the year, including new proposals, withdrawals and reviews of existing legislation. 

Several key initiatives are expected to be unveiled within the first 100 days of the term, signalling the emerging policy direction. Let’s take a look at some of its key limbs:

Clean Industrial Deal: positioned as the flagship initiative on sustainability of the 2024-2029 mandate, this initiative will outline measures across energy, transport, circular economy and competition over the next five years.  While details are sparse, this successor to the European Green Deal will shift focus from ‘green’ to ‘clean,’ prioritising the ‘deal’ element with a pro-business approach—or at least presented as such. The launch is currently scheduled for 26 February 2025.

White Paper on Defence: expected to predominantly address defence sector capability issues, industrial competitiveness and investment needs, all key issues of this term given the wars on Europe’s doorsteps. Among other things, the white paper should outline the path towards key initiatives such as a European air shield to bolster air defence across the continent and expanded cyber-defence capabilities; closer EU-NATO cooperation; more efficient EU Member State defence spending; the reduction of external dependencies in defence procurement; and increased intra-EU collaboration in industrial, innovation, procurement and production issues. 

AI Factories Initiative: expected to establish a network of “AI Factories” designed to support innovation in artificial intelligence by providing essential resources to AI startups, researchers, and industries across Europe. These “factories” should serve as a one-stop-shop where participants can access high-performance computing power, data, and expertise to create, test, and validate AI applications.

Vision for Agriculture and Food: expected to look at how to ensure long-term competitiveness and sustainability of the EU’s farming sector, a key target group of this new Commission given the protests they launched earlier this year, by supporting the entire food value chain through investment and innovation on farms, cooperatives, in the agrifood businesses and many SMEs in the sector. 

Laser focus on competitiveness and simplification – the example of the twin transition

The twin digital and sustainable transitions, a key focus of the last term, are probably the area where we see the most clearly the challenges that the new Commission will face in terms of solving the equation between staying faithful to the rulebook agreed in the last mandate - for example under its comprehensive and far-reaching digital strategy and European Green Deal - and simplifying, streamlining and amending some of the existing legislation to reduce compliance burdens with the overall aim of fostering competitiveness. We have already seen examples of this conundrum in the past few weeks:

In the sustainability sphere, the new Commissioners, including President von der Leyen, have all said Europe needs to “stay the course” on the European Green Deal and have clearly committed to a 90% GHG emissions reduction target for 2040 in the European Climate Law. At the same time, these objectives are under pressure by the Commission itself as shown by the surprise announcement by von der Leyen regarding an ‘Omnibus’ proposal to review CSRD/CSDDD and Taxonomy. Similarly, the application date of the EU anti-Deforestation Regulation has been postponed by one year.

In the digital sphere, we know that the Commissioner responsible for tech sovereignty Henna Virkkunen will conduct a Digital Fitness Check within the first year of her mandate, considering possibilities to cut administrative burdens and simplifying processes. In addition, by November 2025, a review of the DSA will be undertaken, and a brand-new initiative dubbed the Digital Fairness Act (DFA) will be unveiled (likely in 2026) with a public consultation to come in Q1 2025. The DFA should plug the gaps in terms of consumer protection online via new legislation together with better enforcement of existing rules such as the Consumer Protection Cooperation Regulation as announced by the findings of the Digital Fairness Fitness Check published on 03 October 2024. There are also continued calls as per Mario Draghi’s report on EU competitiveness to take another look at the GDPR, especially when it comes to alignment with the AI Act. 

Conclusion

The regulatory environment for business seems to be shifting towards  a more pro-competitive and pro-growth direction, where carrots would eventually be preferred to sticks, something that a number of EU-based industries have been calling for, both individually and collectively. 

However, the political fragmentation within the EU institutions coupled with a very unstable geopolitical environment make it really difficult to predict and anticipate regulatory and legislative changes. Companies, while they are busy getting ready for complying with a number of pieces of legislation from the last mandate, are therefore likely to face legal uncertainty and unpredictability of an ever-changing regulatory framework. A potential trade war would make this picture even more gloomy. 

It will therefore be absolutely crucial for companies active in the EU single market to stay on top of the political agenda in order to have all the necessary regulatory information for their future development and growth plans.