Europe’s plan to curb Big Tech hits internal roadblocks

The European Commission is set to unveil its Tech Sovereignty Package on Wednesday afternoon, marking the most ambitious effort yet to reduce the continent’s reliance on American cloud, artificial intelligence, and semiconductor infrastructure. However, internal disagreements over the true meaning of digital sovereignty have significantly watered down the initiative.

According to a Reuters report from Tuesday, the package has been visibly shaped by ongoing disputes among EU member states about how aggressive the bloc’s stance should be. The forthcoming documents are expected to include the Cloud and AI Development Act, an updated Chips Act, and the first formal EU-level definition of “digital sovereignty”,a term the bloc has used for years without legal precision.

The Cloud Act would prohibit EU member states from using American cloud providers to handle sensitive public-sector data in healthcare, finance, and judicial systems. Private-sector usage, in current drafts, remains untouched. The core debate centers on whether sovereignty demands a fully European supply chain or can be achieved through interoperability and managed dependency. EU digital commissioner Henna Virkkunen told Euronews last week that “technological sovereignty is not about isolation,” framing the project as building European capacity rather than retreating from US technology.

That framing is doing significant work. Several outlets have reported that original drafts of the Cloud Act were far more restrictive on US vendors than what commissioners will see on Wednesday. Member states are split. France and Germany have pushed for stricter European-preference rules, especially concerning data hosted by hyperscalers like Microsoft Azure and Google Cloud. The Nordics and Ireland,where US cloud companies have most of their European operations and tax bases,have argued for a softer approach.

The Commission’s compromise is to apply the strongest restrictions only to government-controlled sensitive data, leaving the much larger private-sector market alone for now. This sovereignty package sits alongside several recent actions. The Commission is also preparing record DMA fines against Google, has spent weeks in stalled talks with Anthropic over access to its Mythos cybersecurity model, and is expected this week to reserve two-thirds of the 2 GHz mobile-satellite spectrum band for European operators.

Each move carries its own justification, but the cumulative pattern is unmistakable. A European policy apparatus has decided, in 2026, that the cost of dependence now outweighs the cost of duplication. What the Tech Sovereignty Package will not do is force European companies to switch from existing US providers. The political ceiling on that remains intact: every EU member state government uses Microsoft 365 or Google Workspace, every European bank runs on US-built cloud, and indigenous alternatives are not yet ready to absorb that workload.

The package’s actual instruments work at the margin, restricting new sensitive-data deployments, redirecting public procurement, and funding European cloud and AI capacity over the medium term. The harder question is whether this incentive structure can produce European hyperscalers in the time available. Earlier waves of European industrial policy,on lithium-ion batteries, telecoms equipment, and cloud infrastructure under the Gaia-X programme,did not.

The Tech Sovereignty Package is, in effect, a wager that the political will and public-spending commitments behind it in 2026 are fundamentally different from what came before. Wednesday’s announcement will reveal whether that wager has been bet in full or hedged.