By Alena Mastantuono, Vice President of the EESC in charge of Budget, member of the EESC Employers’ Group

Today, laws are drafted on computers, stored in official journals and published online. Yet despite these modern tools, the approach to regulation remains stubbornly analogue. Laws accumulate over decades, producing unintended bureaucratic burdens and rendering the system opaque.

RegTech – regulatory technology – is a digital solution that promises to transform this spaghetti bowl into a coherent plate. RegTech tools can visualise the regulatory landscape, trace interactions between laws and reduce the time and cost of compliance.

Some EU Member States have already made strides. In Czechia, for example, the public administration uses a single e-tool covering the entire process of creating legislation – from the initial idea to publication in the Collection of Laws. Its legislative process also includes an obligation that new law must include a summary of the obligations it introduces.

This innovative step allows legislative language to be converted into actionable obligations, forming the foundation of a metadata database that can be used to automate understanding and compliance.

Estonia also offers another model – sourcing data directly from business registers rather than requiring companies to submit it repeatedly.

So why is RegTech not the standard at EU level?

The challenge is not technical but institutional. RegTech solutions must be embedded into the regulatory process, and that requires leadership and coordination – something currently lacking at EU level.

Responsibilities are fragmented and innovators in the private sector, where most RegTech ideas originate, often find themselves shuffled between departments, with no clear point of contact or leadership.

Embracing RegTech requires a mental shift – from seeing digital tools as optional add-ons to recognising them as foundational to effective governance. Not only would regulators benefit, but so too would citizens and businesses alike.

Globally, RegTech is a rising force and whoever masters it will gain a strategic advantage.

(Originally published in The Brussels Time.)