The manufacturers make money. They have lobbied for it. See that press release: https://finance.yahoo.com/technology/ai/articles/advanced-driver-distraction-warning-systems-071000637.html
Maybe local car manufacturers appreciate a barrier for importing foreign cars.
But maybe it is simply bad law-making. The law requires such a system. It does not require that it works. Many regulations in Europe are like that.
Partly that may be because industry likes it that way. If they were held accountable for deaths caused by their cars, they would have to do open-ended research. They might be held accountable for sneaky maneuvers. They might have to implement unpopular features, which the politicians would not like either cause voters. This way, they just tick boxes on a compliance checklist. It doesn't matter if it works. That's called "legal certainty". Everyone says how important that is.
But I'm sure, in many cases it is simply incompetence. Neither the politicians nor the bureaucrats who write the laws know what they are doing. Clueless people often try to compensate by micromanaging. They don't know the problems that causes. In fairness, the actual experts work for the industry that is being regulated. You can't trust those guys. So there's no reason to believe the experts when they say something is a bad idea. They say that about anything that costs them money.











Probably, but it's certainly more complicated. Fiat complained about the added cost of such systems. On the low budget end, this adds a noticeable chunk to the price. Bad for sales in the EU, added complications for export. I could imagine the "premium brands" like such regulations that remove some competition.
The yahoo post in OP is a press release by a Swedish tech company that makes such systems. They're not exactly part of the car industry, but they claim to have lobbied for this.