The Commission’s talk of an ‘AI continent’ rests on draft rules that would allow it to override chip supply contracts and keep US suppliers away from sensitive government data.
The European Commission unveiled its long-delayed technology package on Wednesday, a four-step package aimed at easing the bloc’s dependence on American and Asian technology across semiconductors, the cloud, artificial intelligence and open source.
The Commission’s own summary put it in aspirational language, a path to what it calls an “AI continent.” The accompanying drafts read more like an attempt to claw back.
Two of the four bars have weight. The first is the revised Chips Act, billed as the Chips Act 2.0, which shifts the emphasis from building factories to requiring European-made chips.
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The original 2023 act lacked public funding for artificial plants and fell short of its targets, a gap highlighted when Intel scrapped plans for two mega-fabs in Germany.
The revision goes on to crisis powers: according to the draft seen by the Financial Times, the Commission can force chip makers to prioritize orders for critical products during shortages, terminate existing contracts, buy chips from member states, and fine companies up to €300,000 for withholding information about their purchasing power.
The urgency is undeniable. The EU produces less than 10 percent of the world’s semiconductors and remains completely dependent on the United States and Asia for the most advanced chips, those less than five nanometers, the kind that train AI models. More than 52 billion euros in public and private funds have already been committed, with limited movement in that share.
Cloud sovereignty test
The second biting tool is the Cloud and AI Development Act, which would create a single EU-wide framework defining four tiers of cloud “sovereignty”.
Public authorities will have to assess the risk of sovereignty measuring how much their infrastructure depends on non-EU companies, categories are judged by the control of the service and the supply chain, where AI data is processed, where the infrastructure resides and its cyber security.
The practical effect, in the current draft, would limit member states from using US cloud providers to process sensitive public sector data in healthcare, financial and judicial systems, while leaving private sector use untouched.
Henna Virkkunen, the vice-president of the Commission for technological sovereignty, told reporters that the aim was to ensure that the providers of heavy duty work do not hold a “killing machine” over European data. He also added that American companies will find it difficult to reach the highest level of sovereignty because of the US CLOUD Act, which would force American firms to provide information regardless of where it is stored.
Commission President Ursula von der Leyen pointed out that the group cannot rely on others for the technology that keeps their hospitals running and grids stable.
The two remaining measures are soft: an open source strategy for financing European alternatives and pushing public administrations to open source tools, and a digital road map and AI in the energy system. The entire package hinges on Draghi’s competition report, which found the EU relies on non-EU suppliers for more than 80 percent of its digital products, services and infrastructure.
What will happen next is the question of politics as a draft. The documents must be adopted by all 27 member states, and they are divided: France and Germany are pushing for a strict European selection line, while the Nordics and Ireland, where US cloud firms base most of their European operations, want a softer reading.
The package also contains the EU’s first official definition of “digital sovereignty,” a phrase Brussels has used for years without emphasis. Whether instruments move the needle is an open question. Previous efforts, from the 2023 Chips Act to the bloc’s standing AI gigafactory program and its private cloud contracts, set ambitious spending goals that have yet to be met.
