The agreement came after negotiations ended late on Thursday.

The European Commission, the European Union's executive arm, proposed the new law last year in a bid to tackle the increasing risk from cyber threats to any smart devices, including a growing number of household goods as products become more connected.

The commission hopes the rules could save companies affected by such cyber incidents between 180 to 290 billion euros ($196-305 billion) every year.

The law will affect any product that is connected either directly or indirectly to another device or to a network.

The new rules introduce EU-wide cybersecurity requirements for the design, development and production of hardware and software products.

Manufacturers will also be forced to assess the cybersecurity risks of their products, and the rules demand greater transparency on the security of hardware and software products for consumers and business users.

"Connected devices need a basic level of cybersecurity when sold in the EU, ensuring that businesses and consumers are properly protected against cyber threats," said Jose Luis Escriva, Spain's digital transformation minister, whose country holds the rotating EU presidency.

The EU said that in 2021, cyber criminals hacked devices and launched around 10 million distributed denial of service (DDoS) attacks worldwide, rendering websites and online services inaccessible to users.