US lobbyists have already cried discrimination

The European Commission wants to strengthen the region’s capacity in key areas of tech while cutting reliance on external providers.

The European Commission has presented the European Technological Sovereignty Package, which aims to boost European performance in semiconductors, AI, cloud and open source.

Commission President Ursula von der Leyen said the move is about “protecting our citizens, defending our interests and making our own choices.”

The package includes two legislative proposals – the Chips Act 2.0 and the Cloud and AI Development Act – as well as the Open Source Strategy and a Strategic Roadmap for Digitalisation and AI in Energy.

EU prepares to build a semiconductor ecosystem

The original Chips Act, which came into effect in 2023, aimed to develop Europe’s industrial base for producing semiconductors, with the aim of raising the region’s market share from 10% to 20% by 2030.

The Chips Act 2.0 has a similar goal, but specifically aims at “mainstream chips” and “cutting-edge semiconductor technologies that power AI applications.”

The Commission says the new Act will “speed up permitting, deepen cooperation with like-minded partners and introduce a new excellence label for Europe’s semiconductor regions.”

This is all very high-level at present, but it appears that the EU is preparing to put the work in to build a semiconductor ecosystem.

Sovereignty is a priority in cloud

Cloud is the basis of the modern internet. Nearly every company relies on the cloud, and most use US providers.

The Cloud and AI Development Act aims to triple Europe’s datacentre capacity over the next five-to-seven years; support R&D in “cutting-edge and sustainable technologies”; and will introduce a single EU-wide framework to assess cloud and AI sovereignty.

The Act is also intended to support a “more coordinated approach” to AI uptake across EU Member States.

Part of the current bill is an EU-wide framework for assessing cloud and artificial intelligence sovereignty. The framework includes four assurance levels; countries will be able to choose which levels are needed for which systems, but levels three and four require that the system provider is “not subject to the control of a third country or a legal entity established in a third country.”

That immediately disqualifies US tech firms, which are all subject to the US Cloud Act. This law allows the US government to request information stored on American servers – no matter where in the world they are located.

“With the USA, with the Cloud Act, it is difficult for their companies to reach Level 3,” said Henna Virkkunen, the commission’s senior tech policy executive, during a press conference this week. “There are powers in this Cloud Act which are not in line with our rules here.”

Lobbyists for US tech giants, including the Computer and Communications Industry Association, have already accused the EU of discrimination.

Daniel Friedlaender, SVP and head of office at CCIA Europe, said, “By pairing a strict mandate with unrealistic standards that the EU itself cannot meet, the commission is effectively giving national capitals carte blanche to shut out trusted global vendors from every major technology-producing nation outside the Union.”

The irony, at a time when Donald Trump is enacting a range of protectionist trade policies, is apparently lost on Friedlander.

A cyber stumbling block

All four assurance levels in the proposed Act rely heavily on cybersecurity, with levels 2-4 requiring certificates from a European cloud cybersecurity certification scheme. However, that scheme is not yet up and running.

Although the certification scheme has been underway for years, progress has been stalled due to disagreements between member states.

Instead, the new proposal says cloud service providers will require certification from national providers, adding a bureaucracy headache.

EU public sector welcomes open source

The Open Source Strategy is a stance from the European Commission rather than a legislative proposal, but a welcome one for Europe’s three million open source contributors.

The OSS promises to scale up open source alternatives in “priority areas such as cloud, AI, internet technologies, cybersecurity and semiconductors,” as well as promoting an open source ecosystem with investments in skills, startups and open source infrastructure.

On top of this, the OSS will support public administrations (governments, agencies, etc) to adopt open source – especially European open source – through procurement guidelines and best practice recommendations.

Amanda Brock, CEO of OpenUK, told us it had taken “decades” of work to reach this point.

“There cannot be digital sovereignty today without open source,” she said.

But, she added, the UK – despite having had an open source policy in place for the public sector since 2011 – is “way behind” in adoption.

“It’s time for us to embrace our leadership in open source to keep up with our neighbours,” she concluded.

Building infrastructure

Finally, the Strategic Roadmap for Digitalisation and AI in the Energy Sector recognises that the datacentre boom is increasing pressure on electricity demand.

The roadmap aims to ensure datacentres are integrated into Europe’s energy system “in a sustainable and transparent manner” by coordinating cooperation between the digital and energy sectors.

The European Commission also intends to accelerate the deployment of AI and other digital solutions in the energy sector to “improve and smarten” the region’s electricity infrastructure.

Part of this means developing secure, sovereign AI models specifically built for the energy sector. These models will be built in Europe and trained on European data.

The next steps are for the Commission’s legislative proposals on chips and cloud to be negotiated in the European Parliament (which, by the way, this week released an internal memo – seen by Politico – saying it would adopt France’s Qwant as its default search engine instead of Google).