(CN) - Responding to fears that Europe has become a "digital colony" of American and Chinese tech giants, the European Commission on Wednesday laid out legislative proposals to foster European-made chips, artificial intelligence and cloud services.

The commission's strategy for "tech sovereignty" is part of a broader appeal by European businesses, governments, civic society and the general public to push back against the dominance of American and Chinese tech giants and build up Europe's tech sector.

Europe has many tech companies, but few giants. Only four of the world's largest tech companies are European; meanwhile, Europe has fallen far behind when it comes to making semiconductor chips, network and digital infrastructure, AI, software and cloud platforms, and cybersecurity. The EU relies on non-European products for about 80% of its tech needs.

With Wednesday's proposals, Brussels hopes to change that narrative and ensure its own technological self-sufficiency in a world of growing conflict and danger.

"We cannot afford to depend on others for the technologies that keep our hospitals running, our energy grids stable and our services secure," said Ursula von der Leyen, the commission president, in a statement.

In the coming months, the commission, the EU's executive branch, will work with the European Parliament and the EU's 27 member states to fine-tune and finalize the core elements in Wednesday's initiative: two laws called the Chips Act 2.0 and the Cloud and AI Development Act.

With these laws, Brussels aims to get more public services and European data handled by European-made tech products, streamline bureaucracy hindering the construction of data centers and AI gigafactories, and invest in more European semiconductor makers and tech startups.

"Together, these measures support Europe's ambition to become an AI continent, strengthen its digital autonomy and help build a more sustainable digital future," the commission said.

But it will not be smooth sailing - far from it.

The new measures, if adopted, could deepen trade tensions with the United States and China, especially if the measures are seen abroad as protectionist. A tech trade war, critics worry, could leave Europe falling even further behind if, for example, the U.S. and China retaliate by cutting off access to key technologies and raw materials.

On Wednesday, the commission sought to tamp down concerns.

"Technological sovereignty does not mean protectionism," said Henna Virkkunen, a commissioner overseeing the proposals, at a news conference. "Europe remains grounded in openness, partnership, and fair competition."

But she said the commission wanted "to make sure that our most critical, sensitive data is stored in Europe."

This referred to a core issue at stake as relations between Europe and Washington sour under President Donald Trump.

European concerns are linked to the passage of the U.S. CLOUD Act in 2018. This law allows U.S. authorities to access European data, regardless of where it is physically stored. The U.S. law goes against Europe's strict data protection laws.

For the EU, then, relying on American tech giants like Amazon and Google for cloud services creates legal vulnerabilities and leaves it exposed to "kill switch" risks, a situation where essential services are even shut down.

Virkkunen said only "those who champion technological innovation will shape the future - and we must ensure that Europe plays a leading role in this."

The U.S. tech industry blasted the proposals.

The European office of the Computer & Communications Industry Association, a Washington-based lobby group for the tech industry, called the proposals "discriminatory" and "protectionist."

"Europe's digital ecosystem will only thrive if its compute capacity can scale at global speed and real demand for cloud and AI services is allowed to grow," the group said. "Today's protectionist proposal fails on both fronts."

Also, critics contend Europe's lack of tech champions won't be fixed with even more regulation - a Brussels specialty - but rather by scaling back rules, attracting investment and unharnessing entrepreneurs.

In response to that criticism, Virkkunen said the commission was opening talks with EU states, the European Investment Bank and financial stakeholders to drum up more private funding for "high-risk tech investments."

"While our global competitors are pouring massive amounts of cash into the sector, Europe is facing a critical investment gap," she said. "We urgently need private capital to step up and fund our largest, most strategic projects."

Along with its proposals, the commission said it wanted to triple data center capacity in Europe over the next five to seven years and encourage the use of AI to spread in Europe.

In keeping with its Green Deal climate ambitions, Brussels said it wanted to favor the use of renewable energy to power data centers and other energy-intensive tech operations.

Another plank of the initiative seeks to harness the power of Europe's 3 million open-source developers to fulfill tech needs, the commission said.

"They deliver digital solutions made in Europe, for Europe, based on European principles and values," the commission said.

In tech terminology, open source refers to software, tools and technologies whose source code is publicly accessible, modifiable and distributable.

The commission said it wanted to direct funds toward companies and individuals working with open-source software and steer governments toward using open-source software.

The EU hopes its tech strategies will steer more money toward European companies. Citing a recent report, the commission lamented how the bloc spends 264 billion euros ($306 billion) each year on non-EU proprietary digital products and services.

In Europe, reactions were mixed, with a digital rights watchdog group finding it too corporate-friendly while many European Parliament lawmakers expressed support.

European Digital Rights, an association of civic and human rights groups, said it was disappointed by the proposals, warning the commission had a "misguided belief in data center growth and hyper-scaling unicorns." In tech jargon, a unicorn is a startup company that quickly reaches a valuation of $1 billion.

"Any policy for 'sovereignty' should focus on providing people in Europe with increased digital self-determination, not on building European versions of Big Tech," the group said in a statement. "It is time to steer this continent towards a future where technology works for the people, democracy, and the planet."

Valerie Hayer, the president of Renew Europe, a liberal group in the European Parliament, hailed the proposals as safeguarding Europe's future.

"Europe must break loose from foreign dependencies to become its own digital giant," she said on social media. "Recent geopolitical tensions have made one thing clear: when technology becomes a tool of power, dependence becomes a vulnerability."

Courthouse News reporter Cain Burdeau is based in the European Union.

Source: Courthouse News Service