Europe unveils tech sovereignty package amid U.S. tech reliance concerns
The European Commission on Wednesday proposed a set of rules aimed at supporting home-grown chips, artificial intelligence and cloud services as the bloc struggles to advance technology dominance in an environment heavily reliant on products and services from the United States and China.
The proposals, which must be approved by all 27 member states, include new actions to support advanced chip manufacturing and native cloud computing.
As geopolitical tensions mount around the world, calls are growing for Europe to move away from critical non-European technology providers, including the US tech companies that currently dominate the European market.
“We cannot afford to rely on others for the technologies that keep our hospitals running, our energy grids stable and our services safe,” Commission President Ursula von der Leyen said in a statement. he said.
‘Kill the key’
As part of the proposals, a Cloud and Artificial Intelligence Development Act (CADA) is being introduced to “mitigate risks arising from the EU’s dependence on third countries for cloud computing services” by implementing an EU-wide framework that sets out the different levels of sovereignty required for cloud computing for sensitive workloads in public organisations, according to the Commission’s press release.
The European Commission wants to ensure cloud providers do not have a “kill switch” for critical workloads, Vice-President Henna Virkkunen told reporters.
He added that it would be difficult for US companies to achieve the highest levels of sovereignty due to the US Cloud Act, which allows US law enforcement to request user data from American companies regardless of where the data is stored.
“We want to make sure that our most critical sensitive data is stored in Europe,” he said.
Catherine di Lorenzo, partner at A&O Shearman, told CNBC that CADA is a “significant shift.”
“The direction of travel already goes well beyond data residency and includes ownership structures, exemption from extraterritorial laws, operational control and supply chain transparency,” he said.
Supporting chips
A second law called the Chip Act 2.0, designed to support Europe’s semiconductor industry, was also announced. The first law introduced a number of measures aimed at securing semiconductor supplies and increasing the EU’s global share of the market.
In the regulation proposal, it was stated that the new law aims to eliminate excessive dependence on third countries in chip design and production and inadequate preparation against crises.
The Chips Act 2.0 will seek to build capacity in the cutting-edge semiconductor technologies that power artificial intelligence. The commission said it would “prioritize” building a foundry for advanced semiconductor manufacturing capabilities within the bloc.
“This package is an important step; access to computing power, energy, talent and digital infrastructure in the age of artificial intelligence will determine which countries will succeed,” Keegan McBride, Director of Science and Technology at the Tony Blair Global Change Institute (TBI), told CNBC.
“But a complete retreat to a tech-first approach in Europe would further weaken the continent,” he added. “Major powers don’t just use technology at home; they also need to have a global ambition to build, distribute and export their technology to the world. Europe isn’t doing that at the moment.”
