Issue #20 - May 15, 2026
- Europe fine tunes further the EU AI Act - Will a tech sovereignty agenda be enough for Europe to stop depending on US tech?
Sébastien Louradour
5/15/20263 min read
Europe fine tunes further the EU AI Act
After failing to reach an agreement two weeks ago on the Digital omnibus, the EU reached one on the AI omnibus. Overall, the AI Omnibus does nothing spectacular. In a very pragmatic approach, the file has rescheduled the enforcement of the EU AI Act, giving more time for industry players, and regulators to get ready to follow the new AI rulebook. As a measure of urgency, it adds the prohibition of CSAM AI generated content. And finally, clarifies further enforcement overlaps. On the latter, the file ends up focusing on two main enforcement issues, (i) the perimeter of enforcement between the AI Office (a EU centralised body), and national authorities and (ii) the overlap between the EU AI Act and sectoral legislation of industrial AI. On (i), the trilogue has agreed to give to National authorities the competence to enforce rules for High-risk model providers (aka the big AI Labs) when it comes to the systems they themselves deploy for law enforcement, border management, judicial authorities and financial institutions. In practice it means that for example the use of facial recognition technology used by the police is de facto enforced at national level. It’s a win for the 27 national authorities that are currently being designated to enforce the EU AI Act at national level, but a fragmentation of the AI Office's supervisory authority over the very applications — facial recognition by police, border management, financial institutions — that carry the highest societal stakes, and will ultimately complexify the regulatory approach of AI Labs. On (ii), the EU buys more time too when it comes to overlaps between already existing sectorial legislation (in sectors such as medical devices, toys, lifts, machinery and watercraft) and where the EU AI Act intervenes. The conclusion of the trilogue is to draft ad-hoc implementing acts to determine the interplay between the AI legislation and the already existing ones. Machinery regulation (which includes industrial automation in assembly lines, agricultural machinery, etc.) is exempted from the EU AI Act and will keep being regulated under the EU Machinery Regulation. Eyes will now be turned to the Digital Omnibus and the next trilogue.
Will a tech sovereignty agenda be enough for Europe to stop depending on US tech?
There have been better years for US tech companies navigating the European market. The Trump administration has actively and intentionally weakened its relationship with Europe, on the basis that the relationship has been unbalanced for a while, and that when it comes to NATO, the stake of Greenland, the unfair treatment of US tech companies by Brussels, not to mention what they see as censorship of social media platforms — the cup is full, and things must change so the US at last gets a better deal. The reaction from the other side of the Atlantic has come quite quickly. Sovereignty has become the main political driver of Europe for the past few months, a concept long championed by France alone for many decades, but now adopted by Germany, a longtime undisputable ally of the US. This new approach isn't just driven by policymakers, the US soft-power has also started to fade when it comes to obvious strategic sectors. EU buyers now think twice about the risks of purchasing US technology in sectors such as defence, AI, space, cloud, automotive, payment, and everywhere critical infrastructure is at stake, and dependency on the US has become real. This reckoning is starting to materialise in real data points. Policymakers have started to launch ambitious plans to re-engage Europe on a path to regain its sovereignty. It starts with Stéphane Séjourné's "Made In Europe" plan. Stock market signals indicate that the Stoxx Europe 600 has outperformed the S&P 500 this year in euro terms, and many EU deep tech startups are gaining momentum in sectors such as nuclear fusion power (Proxima Fusion) or space launchers (Isar Aerospace). Still, Europe remains profoundly attached to US technology. When enterprises migrate to Office 365, switch to Azure to stop having data centres on premises, millennials spend hours on their iPhones scrolling on Instagram, and finish the day watching the latest Netflix show, it says a lot about what consumers actually want — and what they want isn't necessarily EU tech. In the article "Life without US Tech", The FT has done the exercise of what a typical day would be without access to US tech, and the EU alternatives, when they exist, are not very appealing to say the least. Quality of technology, emphasis on user experience, brand power, policy incentives for innovation, and access to capital as a driver to scale up are all at stake here. And on these matters, the US is still ahead and might very well keep this advantage for a long time. Even if Europe subsidises the effort for a "Made in Europe", simplifies its tech policy framework, and asks its public services to buy EU tech, all of this might not be enough to make room for EU tech leaders to emerge. In the long run, in free markets, consumers tend to buy what is best for them, not the most sovereign.