On 8 October 2025, the European Commission published its Apply AI Strategy (the “Strategy”), a comprehensive policy framework aimed at accelerating the adoption and integration of artificial intelligence (“AI”) across strategic industrial sectors and the public sector in the EU.

The Strategy is structured around three pillars: (1) introducing sectoral flagships to boost AI use in key industrial sectors; (2) addressing cross-cutting challenges; and (3) establishing a single governance mechanism to provide sectoral stakeholders a way to participate in AI policymaking.

The Apply AI Strategy is accompanied by the AI in Science Strategy, and it will be complemented by the Data Union Strategy (which is anticipated later this year).

Sectoral Flagships

The Strategy identifies eleven sectoral flagships, each accompanied by specific actions the Commission will undertake. The eleven sectors covered are: healthcare (including pharmaceuticals); robotics; manufacturing, engineering and construction; defence, security and space; mobility, transport and automotive; electronic communications; energy; climate and environment; agri-food; cultural and creative sectors, and media; and the public sector. The Strategy states that new initiatives in the future may target other sectors — such as finance, tourism, and e-commerce.

Annex 3 of the Strategy sets out a useful table of the specific actions that the Commission plans to take, and the target date for these actions. These include, among others, the following:

• Healthcare, including pharmaceuticals
  • Establish in Q2 2027 European AI-powered advanced screening centres to help introduce innovative tools for prevention and diagnosis, particularly for cardiovascular disease and cancer. These AI-powered centres will facilitate access to health datasets building on the European Health Data Space;
  • Establish in Q4 2027 a European Network of Expertise on AI Deployment in Healthcare to consolidate guidelines and best practices on AI deployment in healthcare;
  • Launch in Q4 2026 an AI drug discovery challenge for potential new drugs that could be used to address unmet medical needs and treat difficult-to-treat diseases (e.g., Alzheimer’s or certain cancers);
  • Propose in 2026 appropriate actions to streamline market entry of medical devices incorporating AI without compromising safety;
• Mobility, transport and automotive:
  • Leverage starting in Q2 2026 AI factories and gigafactories to fast track the development of AI models and common software platforms to facilitate automated driving and vehicle management systems;
  • Launch in Q4 2026 an “Autonomous Drive Ambition Cities” initiative to accelerate the deployment of operational services, such as AI-enabled self-driving vehicles and autonomous point-to-point commuting in cities;
• Energy:
  • Adopt in Q4 2026 a standardisation request on common reporting and documentation processes on AI systems’ and general-purpose models’ impact on energy consumption;
• Cultural and creative sector:
  • Launch in Q1 2027 a targeted study to explore the legal challenges related to AI-generated outputs and how safeguards could be used to prevent and mitigate the risks of copyright infringing AI content being generated.

Cross-Cutting Challenges

In addition to the sectoral flagships, the Strategy also addresses four cross-cutting challenges to support AI adoption across sectors, as follows: (1) enhancing opportunities for European startups and SMEs; (2) enabling an AI-Ready workforce across sectors; (3) supporting AI as a production factor; and (4) ensuring trust in the European Market.

Among other things, the Commission plans to:

• Launch in Q1 2026 a Frontier AI Initiative to accelerate progress in frontier AI capabilities (i.e., highly capable general purpose AI models) in Europe by bringing together industrial and academic actors;
• Launch in Q2 2026 a call for expression of interest inviting European companies to share their AI models and systems with the network of European Digital Innovation Hubs, to promote wide-scale deployment across strategic sectors.

The Commission also plans to publish further guidelines on the practical application of the EU’s AI Act. The Commission plans to prioritize in Q1 2026 two guidelines: (1) the guidelines on the classification of AI systems as high-risk, and (2) guidelines on the AI Act’s interplay with other Union law, covering relevant sectoral legislation (e.g., transport, machinery, radio equipment).

Governance Mechanism

To coordinate sectoral stakeholders and policymakers implementing the Apply AI Strategy, the Commission plans to establish a single governance mechanism by taking the following steps:

• Launch in Q4 2025 the Apply AI Alliance as a coordination forum for industry and civil society stakeholders and policymakers.
  • The Apply AI Alliance will enable networking among peers and providers and users of AI solutions. The AI Office plans to host annual gatherings to discuss AI innovation policies and establish sectoral boards to monitor the strategy’s implementation.
• Set up in Q2 2026 an AI Observatory to monitor AI impact and trends.
  • Based on the monitoring activities, the Commission will make a proposal of a public and private AI investment target. The monitoring will also be used for future policy-making and for informing the AI community and the public about recent developments in the field.

The Covington team continues to monitor regulatory developments on AI, and we regularly advise the world’s top technology companies on their most challenging regulatory and compliance issues in the EU and other major markets. If you have questions about AI regulation, or other tech regulatory matters, we are happy to assist with any queries.