Key insights
- European efforts to boost homegrown tech industries and reduce reliance on US Big Tech may inadvertently exclude non-EU players, including those from Australia, Canada, and Japan. Trade bodies warn that proposed market access rules could lead to discrimination, increased costs, and reduced opportunities for trusted foreign investors in the EU's digital ecosystem. This could create inefficiencies and complicate cross-border business, potentially impacting global tech supply chains and competition.
By Foo Yun Chee
BRUSSELS, June 8 (Reuters) - Europe’s push to cut its reliance on U.S. Big Tech with EU-made technologies and chips could shut out other non-EU players from the European market, trade bodies representing tech companies in Australia, Canada and Japan warned on Monday.
The warning by the Tech Council of Australia, the Canada EU Trade and Investment Association, the Japan Association of New Economy and tech lobbying group CCIA came a week after the European Commission proposed laws to boost homegrown cloud, AI and chip industries and cut dependence on U.S. tech giants such as Google and Microsoft.
EU telecoms ministers will on Tuesday discuss the proposal, which needs to be thrashed out with EU countries and the European Parliament in the coming months before it can become law.
The trade groups expressed concerns about proposed market access requirements against companies headquartered, or owned or controlled, outside the EU, saying these would significantly affect their members’ participation in the European digital ecosystem.
"Approaches that rely on a vendor’s corporate structure, jurisdictional exposure, or geographic origin when determining eligibility – whether that’s for providing cloud, AI, or software – could lead to uneven treatment of suppliers," they said in a joint letter to EU ministers.
That could reduce opportunities for trusted companies that have long been investing in Europe’s digital development, they added.
They warned that restricting customer choice in how services can be sourced or deployed could lead to inefficiencies, jack up costs, and complicate cross-border business models.
"We would therefore encourage Member States and the European Parliament to ensure that CADA is revised in a manner that remains consistent with the principles of non-discrimination, proportionality, and openness to key trade partners," they said.
CADA (the Cloud and AI Development Act), is a key plank of Europe’s tech sovereignty drive.
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