Senior Policy Manager, UK & Europe
European leaders are increasingly articulating their reliance on foreign technology and their desire to become technologically sovereign. President of the new European Commission, Ursula von der Leyen, set the tone in her guidelines for 2019-2024: “Europe must lead the transition to a healthy planet and a new digital world…It may be too late to replicate hyperscalers, but it is not too late to achieve technological sovereignty in some critical technology areas.” Von der Leyen’s words mirror the sentiment of French President Emmanuel Macron, who in a recent Economist interview lamented that Europe focused its technology policy too narrowly on market issues, such as roaming and competition, at the expense of strategic thinking. According to Macron, Europeans should be worried that much of their sensitive technology is Chinese and American. European leaders believe 2020 is the time to act to defend Europe’s interests and promote regional industry.
The EU plans to promote this view by boosting its capabilities to compete with leading tech nations. It will adopt a three step approach of imposing more tech regulation and standards, assessing reliance on foreign technology, and creating European alternatives. These initiatives will put Europe first and protect European values in the tech sphere.
Regulating Big Tech
The first step in becoming technologically sovereign is gaining back control from foreign companies by imposing new standards on tech giants. Europe is presently the primary rule-maker and trendsetter in tech regulation. The GDPR demonstrated that the EU can impose and export its standards and values on a global scale. Until now, however, EU tech policy has focused on market issues and protecting EU citizens’ data. 2020 will see new standards, rules and oversight measures related to new technologies imposed. Cybersecurity and environmental protection will be important topics in the coming year and will allow Europe to enforce its preferences, making it difficult for foreign companies to operate in the EU.
Assessing Reliance on Foreign Technology
Europe is apprehensive about its reliance on foreign technology and trust in non-European operators to serve its interests is decreasing. For example, when private companies meet EU officials they are often asked if their company is legally established in the EU. Europe’s weariness of foreign tech is not a new concept. Galileo and EGNOS, the European global navigation satellite system, were born out of the political will to end the EU’s reliance on America’s GPS and Russia’s GLONASS 20 years ago. The difference is that foreign tech is considered a threat to Europe’s economy and societal values on a larger scale and with more urgency than before.
The commission has been tasked with assessing Europe’s reliance on non-European technology for critical services and infrastructure in 2020. A leaked internal document asserted that the “EU is currently unable to independently guarantee the supply of key digital technologies. Essential industrial and business value chains depend today on third country technology providers. This results in high risk of disruption or dependency with a potential to impact the economy and our standards of living, democracy security and safety.” European leaders now face the question of how to respond to this threat and reverse the trend. Their response is digital sovereignty.
Digital sovereignty has been used in privacy manifestos advocating for greater individual control of personal data and has been adopted as the new motto of EU officials. It is a broad notion encompassing individual data ownership, data localisation, domestic technologies and even digital tax. Europe is prepared to restrict external country suppliers to its 500 million consumer market and rely on existing European providers or develop European alternatives. EU strategic autonomy builds on this and is applied to the most sensitive sectors like critical infrastructure, defence and space.
There is no consensus among EU member states on what Europe’s digital sovereignty and strategic autonomy should look like. Nonetheless, they agree on the need to build up Europe’s capabilities and develop digital champions. The French Commissioner Thierry Breton will lead Europe’s industrial strategy to enhance technological sovereignty and develop industry. This is a long-term plan that requires heavy investments in technology, education and skills and covers everything from investment in SMEs to trade. While this is a start, EU officials are conscious they will still rely on non-European tech champions for a period of time with the hope that European champions will eventually take over. Those in charge need to ensure they moderate protectionist measures, alongside helping European operators to scale and favouring them in the domestic market. Despite strong political support and significant investments, national and regional projects can fail and have done so in the past. For example, the search engine Quaero, built in 2006, to compete with Google and the sovereign cloud in France, built in 2016, which was meant to safely store citizen and business data.
While public procurement and EU funding will seek to promote ‘union technology’, the EU must manage complaints of unfair competition. Certain measures could ultimately hurt more than help European industry. It remains to be seen how the new Commission will balance these ambitions and their goal of digital sovereignty and gaining strategic autonomy in key sectors. The UK, the Netherlands and the Nordics, the free market champions of Brussels, have always opposed protectionist policies. With the UK’s departure from the EU, however, there will be space for big member states, especially France and Germany, to impose their views on others.
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To find out more, join Access Partnership’s Mike Laughton, Tiernan Kenny and Héloïse Martorell on 13 February to learn how Europe’s “digital sovereignty” approach will guide the next five years of technology policy and regulation in the EU (and beyond) and understand what it means for your business.