EU Proposes Sweeping Regulations to End Reliance on US and Chinese Tech

The European Commission has proposed a sweeping new set of regulations, approved by its 27 member states, to abandon their reliance on American and Chinese technology. The push for "tech sovereignty" comes amid warnings that a foreign power could weaponise critical digital infrastructure against the countries in the region. According to a report by CNBC, the proposals specifically target advanced microchips, artificial intelligence (AI), and cloud services -- which are essentially the sectors that are currently dominated by corporate giants in the US and China. “We cannot afford to depend on others for the technologies that keep our hospitals running, our energy grids stable and our services secure,” European Commission President Ursula von der Leyen said in a statement.

Europe 'wary' of foreign 'Kill Switch'

The legislative push centres around the newly introduced Cloud and AI Development Act (CADA), a framework that aims to mitigate the extreme national security risks that stem from European public organisations storing sensitive data on foreign cloud networks. European Commission Executive Vice-President Henna Virkkunen warned reporters that the bloc must ensure foreign cloud providers do not possess a digital “kill switch” that could instantly paralyse European services during a geopolitical crisis. Virkkunen noted that under these new rules, it would be incredibly difficult for American tech companies to meet Europe’s highest security tier. This is primarily due to the US Cloud Act that grants American law enforcement the authority to demand user data from US companies, regardless of whether that data is physically stored on European soil. “We want to make sure that our most critical sensitive data is stored in Europe,” Virkkunen highlighted, suggesting that the region is moving beyond simple data residency to scrutinise corporate ownership structures, supply-chain transparency and immunity from foreign laws.

EU doubles down on microchips: Chips Act 2.0

Apart from rewriting cloud security rules, the Commission announced Chips Act 2.0, an escalation of its existing semiconductor strategy. The updated regulation is designed to fix Europe’s overdependence on other countries for microchip design and manufacturing, which has left the continent highly vulnerable to global supply chain crises. Since cutting-edge semiconductor technologies are the literal fuel powering the ongoing AI boom, the Commission announced it will “prioritize” constructing a brand-new, advanced semiconductor manufacturing foundry directly within the European Union.