The European Union reveals details of its tech sovereignty package

New proposals will see the EU further invest in European startups and companies as it looks to strengthen its homegrown tech footprint.

The European Commission has announced a new European Technological Sovereignty Package, designed to further reduce its reliance on foreign tech. The EU wants to focus on building out Europe's capacity in areas such as semiconductors, AI, cloud computing and open-source projects.

The package consists of two legislative proposals. The first is the Chips Act 2.0, a refresh of legislation introduced in 2023 that at the time was a response to what the Commission called "critical vulnerabilities in the global semiconductor supply chain."

With the AI boom driving growth in the market, the Chips Act 2.0 will introduce a new excellence label for Europe's semiconductor regions, adopting an ecosystem approach for both AI-related and mainstream chips. The EU wants to bring chip manufacturers closer to their customers so they can capitalize on growth sectors such as data centres and cloud providers.

Also part of the proposals is the Cloud and AI Development Act, which reinforces Europe's plan to triple data centre capacity on the continent within the next five to seven years. The legislation is another arm of the EU's Apply AI Strategy, which encourages AI adoption and innovation across its member states.

The Commission says the Act will "support research and innovation in cutting-edge and sustainable technologies, while balancing AI ambitions with climate commitments." The conditions for deploying data centres across the EU will be streamlined, while a new EU-wide framework built around cloud and AI sovereignty will, it says, protect sensitive data while supporting the rollout of advanced AI and cloud tech.

The new proposals also put a big onus on open-source projects in growth sectors like AI and cybersecurity. The EU says it will support open-source startups and invest in skills, while amplifying initiatives like the Open Internet Stack.

The final component of the package is the Strategic Roadmap for Digitalisation and AI in the Energy Sector, which outlines the Commission's commitment to nurturing cooperation between the energy and digital sectors, and ensuring that any new data centres being added to the grid are done so sustainably and transparently. AI models "trained on European data and developed by European companies" will be key to improving Europe's electricity infrastructure, and the Commission will encourage a faster rollout of smart meters.

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