As explained above, Gene Targeting is technically capable of creating a range of sizes of genetic changes; from single base-pair mutations through to insertion of longer sequences, including potentially transgenes. This means that products of gene targeting can be indistinguishable from natural mutation, or can be equivalent to GMOs due to their insertion of a transgene (see Venn diagram above). Hence regulating products of Gene Targeting can be challenging and different countries have taken different approaches or are reviewing how to do so as part of broader regulatory reviews into the products of gene-editing. Broadly adopted classifications split gene-edited organisms into 3 classes of "SDN1-3", referring to Site Directed Nucleases (such as CRISPR-Cas) that are used to generate gene-edited organisms. These SDN classifications can guide national regulations as to which class of SDN they will consider to be ‘GMOs’ and therefore which are subject to potentially strict regulations. 
* SDN1 = organisms created through Non-homologous End Joining of an SDN-catalysed break in the DNA. Hence random mutations have occurred through the error prone NHEJ, and no repair template has been used (hence is not Gene-Targeting). Often subject to less stringent regulatory oversight due to the lack of use of a DNA repair template and equivalence to conventional breeding techniques (in the case of plant breeding).
* SDN2 = one or several specific mutations have been introduced into the target gene at the SDN cut-site through use of a homology-repair template (hence this is Gene Targeting). 
* SDN3 = longer sequences have been inserted at the cut-site, via homologous recombination (i.e. Gene Targeting) or through NHEJ. "Longer sequences" typically refer to entire genetic elements such as promoters or protein-coding regions. These are often considered transgenic and therefore often classed as GMO.
Historically the European Union (EU) has broadly been opposed to Genetic Modification technology, on grounds of its precautionary principle. In 2018 the European Court of Justice (ECJ) ruled that gene-edited crops (including gene-targeted crops) should be considered as genetically modified and therefore were subject to the GMO Directive, which places significant regulatory burdens on GMO use. However this decision was received negatively by the European scientific community. In 2021 the European Commission deemed that current EU legislation governing Genetic Modification and Gene-Editing techniques (or NGTs – New Genomic Techniques) was ‘not fit for purpose’ and needed adapting to reflect scientific and technological progress. In July 2023 the European Commission published a proposal to change rules for certain products of gene-editing to reduce the regulatory requirements for organisms developed with gene-editing that contained genetic changes that could have occurred naturally.