EU deregulation shift undermines digital ID standards influence, says think tank

The EU is inching towards the introduction of its planned pan-European digital identity wallet, designed to give citizens access to public and private services within its single market. But as European institutions sort out the details of the EU Digital Identity (EUDI) Wallets functioning, policy experts are examining if the project could lead to a “Brussels effect” outside of the economic bloc – and whether Europe should collaborate with other countries on standards.

EC invites public to comment on remote user onboarding to EUDI Wallet

This week, the European Commission released a draft regulation on standards for remote user onboarding to the EUDI Wallet and invited public comments.

The draft implementing act notes that user onboarding is a “crucial step” for verifying the identity of wallet users and binding their personal identification data to the device containing the digital wallet.  The feedback period will last four weeks, from December 2nd to December 30th, 2025.

Ronny Khan, senior advisor at the Norwegian Digitalisation Agency, commented on the draft.

“This is technology neutral and does not exclude, but rather includes, fully automated methods,” he says. “For now, this is about upgrading the existing eIDAS user base to the wallet, but may form the basis for starting from zero at a later stage.”

ECDPM: ‘Brussels effect’ should be replaced by a ‘Third way’

Europe’s decision to develop its electronic identification and trust services toward wallet-based digital identities could lead to another “Brussels effect:” EU identity standards could become global and force companies to adopt them even when operating outside of the continent.

However, not everyone believes that the EU will be able to maintain its regulatory dominance,  according to a paper from the European Centre for Development Policy Management (ECDPM).

The ‘Brussels effect’ can only work if Europe remains a significant single market and EU rules remain an effective benchmark for countries that want to establish legal frameworks for governing technology. Recent developments, such as the European Commission’s unveiling of the Digital Omnibus package and its proposed changes to AI and data rules, have put that benchmark under question.

The changes have also created divisions among those who believe the measures are an attempt at deregulation and those who praised it as an attempt to simplify the EU’s complex digital rulebook.

At the same time, a growing number of countries, including India, Brazil, and Japan, are developing their own digital regulatory frameworks, says the Netherlands and Belgium-based think tank.

One solution for the EU is a multinational “third way” and working with other global players on defining digital regulation.

“Shifting geopolitics requires a change in the European Union’s approach – moving from regulatory dominance to one of partnership with other global actors,” says the paper. “The time has come for the Commission to scale this approach to build open protocols that help with the rollout of its regulatory framework.”

Article Topics

digital identity  |  digital wallets  |  eIDAS  |  EU Digital Identity Wallet  |  Europe  |  onboarding  |  remote identity proofing  |  selfie biometrics  |  standards