Strategic Governance and Soft Power: How European AI Firms Reshape Regulation to Challenge Tech Giants

Document Type : Original Article

Authors

1 Department of Regional Studies, Faculty of Law and Political Science, University of Tehran, Iran

2 Department of Regional Studies, Faculty of Law and Political Science, University of Tehran, Iran.

10.22059/jices.2026.402634.1102

Abstract

The European Union has developed a distinctive regulatory approach to artificial intelligence that combines risk-based obligations with participatory and experimentalist governance mechanisms. This article addresses the following research question: how do European AI startups participate in experimentalist governance mechanisms within the EU’s AI regulatory framework, and what implications does this participation have for norm formation, regulatory design, and competitive dynamics in EU digital policy? Drawing on qualitative case studies of firms including Mistral and Aleph Alpha, the analysis is based on policy documents, stakeholder consultations, ethics-related deliberations, and legislative negotiations surrounding the EU AI Act. The findings indicate that participatory instruments—such as ethics advisory frameworks, consultation procedures, and interinstitutional negotiations—create channels through which private actors may contribute to the articulation of regulatory norms while simultaneously reinforcing institutional legitimacy. The resulting regulatory architecture reflects a hybrid model that combines general transparency requirements with differentiated, risk-based obligations, aiming to balance ethical considerations, innovation incentives, and market competition. This app roach resonates with broader debates in AI ethics that emphasize accountability, transparency, and value-sensitive regulation. At the same time, the analysis highlights concerns regarding asymmetric access to governance processes and their implications for democratic accountability. The article contributes to scholarship on experimentalist governance and AI regulation by clarifying how ethical discourse, institutional design, and stakeholder participation interact in shaping the EU’s emerging framework for artificial intelligence governance.

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