Brussels Strikes Back at Big Tech Dominance
On June 3, 2026, the European Commission unveiled its most ambitious technology sovereignty package to date — the Cloud and AI Development Act (CADA) and Chips Act 2.0. Together, these proposals aim to halve Europe's reliance on U.S. Big Tech within five years, targeting the dominant positions of Amazon Web Services, Microsoft Azure, and Google Cloud in the European cloud market.
The announcement marks a watershed moment in the EU's push for digital sovereignty , following years of mounting concern over foreign control of critical infrastructure. As Commission President Ursula von der Leyen stated: \“We cannot afford to depend on others for the technologies that keep our hospitals running, our energy grids stable and our services secure.\”
What's in the Cloud and AI Development Act?
The CADA package introduces far-reaching measures designed to reshape Europe's technology landscape:
\“Made in EU\” Rules for Public Contracts
For sensitive government projects in defence, healthcare, banking, and energy , vendors must ensure their software and hardware are manufactured and controlled within the European Union. This explicitly excludes non-European companies from handling data and services for strategic government contracts — a move that directly impacts Amazon, Microsoft, and Google.
Addressing the \“Kill Switch\” Risk
EU Tech Chief Henna Virkkunen highlighted the risk that foreign governments could compel providers to disable or disrupt services — a so-called \“kill switch\” — citing the U.S. Cloud Act , which allows American authorities to access EU data stored by US-based providers. Under CADA, member states must conduct risk assessments on cloud providers operating in sensitive sectors and could be required to switch providers if risks are deemed unacceptable.
Fast-Track Data Centers and Semiconductor Goals
The proposal introduces \“acceleration zones\” for fast-track permitting of data centers, aiming to triple EU data center capacity within 5–7 years. However, these accelerated facilities must use European-made chips to qualify for preferential grid access. The accompanying Chips Act 2.0 targets doubling the EU's global semiconductor market share to 20% by 2030.
Big Tech Reacts
US tech giants are already maneuvering to comply. Microsoft has launched Bleu — a joint venture owned by France's Capgemini and Orange — and Delos Cloud, an SAP subsidiary running on Azure infrastructure. Amazon (AWS) has invested billions into European cloud infrastructure and launched a sovereign cloud service hosted entirely in Europe, physically and legally separate from its global platform.
However, the Computer & Communications Industry Association (whose members include Amazon and Google) has called the proposals \“a dangerous recipe for progressive market shutdown\” that would push trusted providers out of EU markets.
Timeline and Outlook
The proposals are not yet law — they must be negotiated with EU member states and the European Parliament, a process expected to take 12–18 months. The move risks escalating trade tensions with the Trump administration, which has already threatened tariffs in response to EU digital regulation.
The CADA builds on a growing regulatory momentum across Europe. For more on this trend, see our coverage of Norway's ban on generative AI in schools and the VivaTech 2026 tech sovereignty discussions. Meanwhile, Seattle's year-long ban on new AI data centers shows the global trend toward data center regulation.
Sources:Reuters, The Guardian, European Commission
Originally published on TekMag
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