The European Commission has presented the European Innovation Act, a new legislative initiative aiming to narrow the gap between high-quality European research and the ability of local companies to turn research results into globally competitive products and services. Published in early September 2026, the proposal seeks to create better conditions for bringing innovation to market across the Single Market. It focuses on two areas where the Commission has identified significant bottlenecks: public procurement of research and development and the commercialisation of intellectual property. The European Innovation Act is part of a broader EU effort to strengthen competitiveness and create an environment in which startups and innovative companies can grow without having to leave Europe. The chasm between research and economic growth The new proposal starts from a challenge that has received increasing attention in recent years. Europe remains one of the world's leading regions for scientific research, but its academic and research performance does not translate the same into global companies, commercialised technologies and new industries. Innovative European companies face two major roadblocks. The first comes before commercialisation, when a technology is still considered too risky or insufficiently validated to attract private capital. The second appears at the scaleup stage, when companies need larger investments, customers and access to a sufficiently large market to continue growing. This challenge is also relevant to Europe's wider productivity gap with other major economies. From the Commission's perspective, the ability to turn research into marketable products and technologies has become a question of competitiveness, economic security and Europe's technological autonomy. The European Innovation Act addresses this problem by changing the conditions under which innovation reaches the market. The proposal aims to establish a more supportive legal framework for R&D procurement and to make intellectual property easier to commercialise and use to access finance. Public procurement, a stronger tool for innovation One of the act’s main components concerns public procurement for research and development, including pre-commercial procurement. This is particularly relevant for startups and companies developing new technologies. Instead of solely purchasing products and services that are already available on the market, public authorities can commission R&D activities to identify and test new solutions. Thus, the public sector can become one of the first customers for a technology that is still under development. This instrument remains significantly underused in the European Union. Around 0.6% of total public procurement in the EU is currelty dedicated to R&D. In the US, for example, the figure is approximately 3.5%, and goes as high as 5% in South Korea. One reason is regulatory fragmentation. The absence of harmonised rules has resulted in different practices across Member States and uncertainty for public authorities interested in using these procurement models, particularly when projects involve buyers or partners across multiple countries. The European Innovation Act proposes an EU-wide harmonised framework for R&D procurement and pre-commercial procurement. According to the Commission, clearer rules can help generate a critical mass of demand for emerging technologies and enable companies to move more quickly from testing to market deployment. The potential financial impact is considerable. Commission documents estimate that increasing investment in R&D procurement from 0.6% to 3% of total public procurement would raise annual spending from approximately EUR 17.3 billion to EUR 86.4 billion. For startup ecosystems, the potential effect goes beyond the value of the contracts themselves. A public procurement contract can provide commercial validation, access to infrastructure, a significant first customer and a reference that makes it easier to attract further customers or investment. Intellectual property, easier to use for financing The second major component of the European Innovation Act concerns intellectual property. For many tech companies, the most valuable assets are non-tangible, concentrated in patents, software, know-how and the likes. Traditional financial systems, however, remain largely structured around tangible assets. Intellectual property is more difficult to value and is therefore used much less frequently as collateral or as a basis for financing decisions. The Commission estimates that this contributes to an annual financing gap of up to EUR 18 billion for innovative European companies with a high proportion of intangible assets. It also notes that EU startups raise around 50% less capital than comparable US companies by their tenth year of operation. The European Innovation Act proposes the development of a common EU framework for intellectual property valuation. A specialised structure dedicated to IP-backed financing would also be developed within the European Union Intellectual Property Office, EUIPO. The proposal additionally provides for the creation of a European marketplace for the commercialisation of intellectual property assets. In practical terms, the objective is to make it easier to determine the value of a patent or another form of intellectual property and enable these assets to play a greater role in lending and investment decisions. For deep tech startups, where a large share of a company's value may be concentrated in technology and intellectual property well before significant revenue is generated, such a change could have a direct impact on capital access. Regulatory sandboxes for more innovation-friendly rules Alongside the European Innovation Act, the Commission has also proposed a Council Recommendation on regulatory sandboxes. Regulatory sandboxes provide controlled environments in which companies can test new products, technologies or business models together with regulators, without having to wait for every legal question surrounding an emerging technology to be resolved through the conventional legislative process. The Commission wants to establish common principles for how these sandboxes are designed and operated across Member States. The aim is to reduce differences between national approaches and make it easier to test innovative solutions within a more predictable framework. This is particularly relevant in sectors where technological development moves faster than regulation, including AI, digital technologies, biotechnology, energy and other deep tech fields. The European Innovation Act, in context This proposal is not an isolated effort. The European Innovation Act is part of the EU Startup and Scaleup Strategy launched by the Commission in May 2025. The strategy contains 26 actions designed to improve the environment for startups and scaleups, covering areas such as regulatory simplification, access to finance, talent, technology commercialisation and access to infrastructure. The Act is also part of the broader Competitiveness Compass, through which the Commission is responding to concerns about Europe's competitiveness highlighted in recent years, including in the Draghi report. A common direction is becoming increasingly visible across these initiatives. European innovation policy is gradually moving from "how can Europe fund more research?" towards "how can Europe turn the research it already funds into technologies, companies and industries that grow in Europe?" Estimated economic impact in the hundreds of billions of euros An analysis by the European Commission's Joint Research Centre estimates that three reforms included in the European Innovation Act, covering intellectual property valuation and R&D public procurement, could collectively generate up to EUR 452 billion in additional GDP and some 500,000 jobs in the EU over the next decade. This figure should be understood as an estimate of the potential impact of the reforms rather than a guaranteed economic outcome. Yet, it illustrates the scale of the economic opportunity that the Commission associates with improving the transition from research to market. At its core, the European Innovation Act reflects a shift in perspective. Europe's challenge goes beyond a shortage of ideas or research, going into whether the economic system can buy, finance and scale those ideas quickly enough. What this means for Romanian startups and innovation ecosystems For Romania, the impact of the European Innovation Act will depend both on the final form of the regulation and on the ability of local institutions and companies to make effective use of the new instruments. A clearer European framework for R&D procurement could create new opportunities for startups and innovative SMEs developing solutions for public administration, healthcare, energy, mobility, security, digitalisation and other sectors in which the public sector is an important buyer. Meanwhile, developing a European methodology for intellectual property valuation could be particularly relevant to tech companies and spin-offs from universities and research organisations, where much of a project's value is often linked to patents and know-how. For regional innovation ecosystems, including those built around universities, research centres, incubators and entrepreneurship support organisations, the new framework could create a more direct connection between research, finance, procurement and the market. This act will not automatically solve the challenges European companies face when scaling. Nor can it replace private investment, funding programmes or reforms required at national level. Still, it does seek to address some of the structural bottlenecks that have limited Europe's ability to convert high-quality research into economic advantage. For the EU, this is also a wider test of its new competitiveness agenda: not only to produce technology and knowledge in Europe, but to create the conditions for the economic value generated by them to remain and grow in Europe.