The European Commission has published new “technological sovereignty” proposals aimed at reducing the bloc’s reliance on foreign suppliers in cloud computing, artificial intelligence, and semiconductor production. The initiative seeks to ensure that no foreign government or company possesses a “kill switch” capable of disrupting vital tech services across Europe.
Reducing Risky Dependencies
Henna Virkkunen, the European Commission vice-president for tech sovereignty, emphasized that the EU wants to guarantee sensitive services and data, particularly those related to security and law enforcement, remain under European control. She noted that the 2018 US Cloud Act, which allows US authorities to access data stored by American providers abroad for national security reasons, conflicts with EU regulations.
“We are not planning to work in isolation and produce everything ourselves,” Virkkunen stated, “but we must identify risky dependencies and ensure no one has the kill switch possibility.” She acknowledged that it would be “very difficult” for US companies to meet strict EU criteria for providing cloud services in sensitive areas such as defense.
Vulnerabilities Exposed
The EU’s technological vulnerabilities were highlighted last year when China halted semiconductor exports, nearly paralyzing the European automotive industry. Additionally, concerns persist that a future US president, including Donald Trump, could terminate US cloud services overnight or compel providers to hand over sensitive data.
The European Commission reported that the EU relies on foreign providers for over 80% of its digital products, services, infrastructure, and intellectual property, creating what it calls “excessive technological dependencies.”
Proposed Measures
The proposals, which require approval from member states and the European Parliament, would mandate EU countries to conduct risk assessments of cloud computing providers in sensitive sectors like defense, criminal justice, and border management. If a service is deemed risky, authorities may be required to switch providers.
US cloud providers operating in the EU might need to comply with EU data protection rules and prove they would not be forced to surrender EU data to US authorities. However, US companies could argue that their European-based entities already meet sovereignty requirements.
Lara Natale, senior director for public affairs at the Centre for Future Generations, predicted that US companies would invest heavily in lobbying efforts to shape the sovereignty discussion. The Computer and Communications Industry Association, representing Amazon and Google, criticized the proposals as “a dangerous recipe for progressive market shutdown” that could push trusted providers out of parts of the EU market.
Boosting European Infrastructure
The Commission also aims to accelerate Europe’s AI infrastructure by fast-tracking data center construction and promoting domestic semiconductor production. However, Olivier Darmouni, an associate professor at HEC Paris, cast doubt on the feasibility of building an “advanced manufacturing facility” for cutting-edge semiconductors and AI chips within the EU.
“To build such chips is not realistic at the time scale needed to catch up to the US and match their AI leadership,” Darmouni said. He noted that producing other chips, such as RAM and memory chips where global shortages exist, could still be beneficial.
Despite the 2023 European Chips Act, the EU produces only 10% of the world’s semiconductors and remains heavily dependent on the US and East Asia for advanced AI chips. Constructing state-of-the-art fabrication plants is a multi-year, multi-billion-dollar effort.
Data Center Expansion and Energy Concerns
As part of plans to triple the EU’s data center capacity within five to seven years, the Commission will introduce a rating system to ensure energy efficiency and create “acceleration zones” for fast-tracked permitting. Darmouni warned that the proposals avoid addressing the conflict between data center buildout and climate goals.
“Very soon, Europe will face the same issues as the US, where people worry that data centers will inflate electricity bills and harm climate trajectories,” he said. Data centers consumed enough electricity to power nearly 20 million homes in 2024, with demand expected to double by 2030.
