The European Union outlines a plan to reduce dependence on American technology

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

As part of the plan, officials outlined greater government involvement in the region’s technology industry to speed up data center construction and revive its semiconductor industry. It would also force European governments and businesses to buy technology from domestic suppliers, while potentially preventing US firms from entering into cloud computing contracts that are considered critical to security.

European leaders are increasingly concerned about reliance on American technology in areas such as artificial intelligence, cloud computing and semiconductors. Many worry that addiction creates a “kill switch” that the Trump administration or future US presidents could use to block access to essential technology services.

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

By adopting more protectionist economic policies, the so-called technological sovereignty package could further strain Europe’s relations with the Trump administration after past disagreements over trade, the war in Ukraine and control of Greenland. Jamieson Greer, US Sales Representative, formerly threatened to retaliate against Europe over its digital policies.

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

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

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

This technology package is part of a broader strategic shift to support economic growth. Europe was sandwiched between the dominance of the United States in technology and the power of China in manufacturing. The European Union operated a trade deficit with China of about 145 billion euros in the first three months of this year, worth about $170 billion, thanks in part to an influx of Chinese-made machinery and electric vehicles.

The European Commission said the bloc relied on foreign providers for more than 80 percent of its digital products, services, infrastructure and intellectual property. The European cloud computing market is dominated by the American companies Amazon, Google and Microsoft. Semiconductors and other critical components come primarily from companies based in the United States and Asia. European companies have also sought to gain a foothold in the fast-growing AI market, led by Silicon Valley’s Anthropic and OpenAI.

After more than a decade of aggressive regulation by Apple, Google, Meta and others, many European leaders now want to develop a larger tech ecosystem to compete with these American giants.

“The European Union stands at a decisive moment to assert its technological sovereignty and regain its place in the global race for geo-economic power,” the European Commission said in the proposal.

Many parts of the new technology package could take a year or more to become law. The proposals must go through a legislative process that requires agreement on the deal between European countries and the 720-member European Parliament.

The main focus of the EU initiative called the Cloud and AI Development Act is the support of European cloud computing. For some tasks processing sensitive government work and public data, non-EU providers would not be able to win contracts.

The bill also supports data center construction by expediting permitting, providing reliable electricity and investing government funds. The European Union claims that it wants to at least triple the capacity of its data centers by 2030.

Another part of the package, Chips Act 2.0, attempts to increase demand for semiconductors among European businesses, including automotive and defense firms. The proposal is based on the 2023 law, which aims to strengthen chip production.

European officials said the technology plan is not about replacing American technology, but about building resilience so that governments and companies in the region are not dependent on a single foreign supplier. The policies are expected to benefit European companies, including German business software giant SAP, French artificial intelligence company Mistral and French cloud computing company OVHcloud.

Officials in Brussels have already eased other regulations to encourage technological development, including delaying some rules related to artificial intelligence. The European Commission could also create a fund for direct investment in domestic businesses – including semiconductors and advanced manufacturing – in exchange for ownership stakes. Countries like France have adopted a policy of building data centers with the promise of access to affordable nuclear power.

Some government agencies are already transitioning away from American technology. The European Parliament announced on Wednesday that it will switch to Google’s French search engine Qwant.