Mark Scott is a contributing editor at Tech Policy Press.
Henna Virkkunen, Executive Vice-President for Tech Sovereignty, Security and Democracy of the European Commission. Source
The European Union has long relied on foreign suppliers for some of its most critical technologies, from semiconductors to artificial intelligence. On June 3, it will lay out plans to change that.
Under the European Tech Sovereignty proposals, Brussels is expected to outline a series of proposals aimed at boosting the production of high-end chips within the bloc, promoting open-source alternatives to digital services provided by US tech giants and nudging national capitals to reassess their reliance on non-European firms for cloud computing and AI services.
The announcement comes as the EU faces growing pressure to demonstrate it can compete with the United States and China in the race to dominate the digital economy.
All three are jockeying for power amid a generational economic shift driven by artificial intelligence and a realignment in long-standing alliances worldwide.
“The world has changed permanently,” European Commission President Ursula von der Leyen told the World Economic Forum in Davos earlier this year. “And we need to change with it.”
In its proposals, Brussels is trying to balance growing public and policymaker demands to cut back ties with the US and many countries’ ongoing reliance — and need — for technologies provided by third-party countries.
EU officials have earmarked billions of euros to jumpstart the bloc’s AI-driven growth, including reams of public spending on high-performance computing infrastructure and the cutting of regulatory red tape as envisioned by Mario Draghi, a former Italian prime minister.
His competitiveness report, published in 2024, called on the EU to double down on tech investment and pare back its digital rulebook to allow European firms to keep pace with rivals from China and the US..
The European Tech Sovereignty package expected on June 3 represents the bloc’s next phase in meeting those ambitions. It remains unclear whether it can outmuscle the US and China, which are spending, collectively, significantly more money on such AI-enabling investments compared to the bloc, according to Stanford University’s latest AI Index report.
The proposals are expected to include a Chips Act 2.0 that includes provisions to boost high-end semiconductor manufacturing within the 27-country bloc by linking it to greater spending on European-based cloud computing infrastructure.
A separate Cloud and AI Development Act will require EU capitals to conduct “sovereignty risk assessments” to determine how much of existing infrastructure is reliant on technology provided by non-EU companies. Governments would then determine which parts should shift to European firms for security or competitiveness reasons.
That could include Brussels calling for hundreds of billions of dollars in public and private investment to build “Made in Europe” infrastructure. Currently, Amazon, Google and Microsoft control around 70 percent of the EU’s cloud market, according to a European Parliament study.
A final component of the proposal — dubbed the Open Source Strategy — is expected to promote the adoption of open-source standards and technologies so that European companies and countries do not become locked to proprietary services provided by a few global tech giants.
Details of the European Tech Sovereignty package may change ahead of its publication on June 3.
This is not the first time that Brussels has tried to chart a path toward technological sovereignty.
The 27-country bloc has adopted a litany of digital rules — from the Digital Services Act and Digital Markets Act to the Data Act and AI Act — to stamp its claim over policing the online world. While some of this legislation has led to significant fines against the likes of Apple and Temu, it has yet to give Europe an economic boost to compete with global rivals.
Other proposals, most notably the European Chips Act from 2023, set benchmarks for tech-driven economic growth that, so far, have failed to significantly alter the bloc’s position against the US and China.
In its proposals, Brussels is walking a fine line between economic nationalism — now espoused by the world’s two economic superpowers — and the bloc’s traditional position of embracing free trade and market competition.
US officials have repeatedly claimed that the EU’s digital rulebook and other tech-focused efforts represent a protectionist ploy to hobble American firms compared to smaller European rivals.
In response, EU policymakers say they are merely leveling the playing field so that all companies — both those from the EU and those from outside the bloc — can equally compete for the bloc’s consumers.
By outlining a renewed effort to boost Europe’s tech-fueled independence, Brussels is tilting to the current geopolitical winds that are promoting economic nationalism over global free trade.
What remains uncertain is whether the proposals — which rely heavily on private investment that has yet to be committed — can deliver where previous efforts have not.
