European Union Outlines Plan to Reduce Dependence on American Tech

European Union officials unveiled a broad plan on Wednesday to reduce dependence on American technology, which they increasingly see as a threat to the region’s economic future and geopolitical security amid a rocky relationship with the Trump administration.

Under the plan, officials outlined more government involvement in the region’s tech industry to accelerate the construction of data centers and revive its semiconductor industry. It would also push European governments and businesses to purchase technology from domestic suppliers, while potentially barring American firms from cloud computing contracts seen as critical to security.

European leaders have become increasingly alarmed by the reliance on American technology in areas like artificial intelligence, cloud computing and semiconductors. Many worry the dependence creates a “kill switch” that could be exploited by the Trump administration or future US presidents to block access to essential tech services.

“We cannot afford to depend on others for the technologies that keep our hospitals running, our energy grids stable and our services secure,” Ursula von der Leyen, the president of the European Commission, the executive branch of the 27-nation bloc, said in a statement.

By adopting more protectionist economic policies, the so-called technology sovereignty package could further strain Europe’s relationship with the Trump administration after past disagreements over trade, the war in Ukraine and control of Greenland. Jamieson Greer, the US trade representative, previously Threatened retaliation against Europe over its digital policies.

European officials are working to implement a trade pact with the United States, and President Trump has told them they must finish by July 4th. The European Parliament is expected to vote on the package in mid-June, just ahead of that deadline.

The Computer and Communications Industry Association, an industry trade group, called the tech package “discriminatory” against companies based outside Europe.

“By excluding trusted international technology providers based on their headquarters location and organizational structure, the commission forces users to rely on a much more limited selection of digital products,” the group said in statement.

The tech package is part of a wider strategy shift to drive economic growth. Europe has been squeezed between the United States’ dominance in technology and China’s strength in manufacturing. The European Union ran a trade deficit with China of about 145 billion euros in the first three months of this year, worth about $170 billion, driven in part by an influx of Chinese-made machinery and electric vehicles.

The European Commission said the bloc relies on foreign providers for over 80 percent of its digital products, services, infrastructure and intellectual property. The American companies Amazon, Google and Microsoft dominate the European cloud computing market. Semiconductors and other vital components primarily come from companies based in the United States and Asia. European companies have also struggled to get a foothold in the fast-growing AI market, which is led by Anthropic and OpenAI of Silicon Valley.

After more than a decade of aggressively regulating Apple, Google, Meta and others, many European leaders now want to develop a bigger tech ecosystem to compete with those US giants.

“The European Union stands at a defining moment to assert its technological sovereignty and reclaim its place in the global race for geoeconomic power,” the European Commission said in the proposal.

Many parts of the new tech package could take a year or more before becoming law. The proposals must wind their way through a lawmaking process that requires agreement on a deal by European countries and the 720-member European Parliament.

A major focus of the EU initiative, called the Cloud and AI Development Act, is boosting European cloud computing companies. For some tasks handling sensitive government work and public data, non-European providers would be limited from winning contracts.

The draft bill also encourages construction of data centers by speeding up permits, providing reliable electricity and investing government funds. The European Union says it wants to at least triple its data center capacity by 2030.

Another piece of the package, called the Chips Act 2.0, attempts to increase demand for semiconductors among European businesses, including automobile and defense firms. The proposed law builds on a 2023 law aimed at bolstering chip manufacturing.

European officials said the tech plan was not about replacing American technology, but building resiliency so governments and companies in the region are not reliant on one foreign supplier. The policies are expected to benefit European companies including the business software giant SAP of Germany, the artificial intelligence company Mistral of France, and the cloud computing firm OVHcloud of France.

Officials in Brussels have already eased other regulations to encourage tech development, including delaying implementation of some rules related to AI The European Commission also might create a fund to invest directly in domestic businesses — including semiconductors and advanced manufacturing — in exchange for ownership stakes. Countries like France have adopted policies to build data centers by promising access to affordable nuclear energy.

Some government bodies are already making the switch from American tech. On Wednesday, the European Parliament said it would move to the French search engine Qwant from Google.