BRUSSELS, June 8 - Trade associations representing technology companies in Australia, Canada and Japan have raised concerns that Europe’s recent policy push to cultivate domestically made cloud, artificial intelligence and chip technologies may exclude trusted providers established outside the European Union.
The Tech Council of Australia, the Canada EU Trade and Investment Association, the Japan Association of New Economy and the Computer & Communications Industry Association (CCIA) jointly issued the warning on Monday, a week after the European Commission introduced a package of proposals aimed at strengthening the bloc’s homegrown cloud, AI and semiconductor industries and reducing dependence on major U.S. technology firms such as Google and Microsoft.
EU telecoms ministers are due to discuss the Commission proposal on Tuesday. The draft measures must then be negotiated with EU member states and the European Parliament in the coming months before any legislative text can be adopted.
The trade groups said they were particularly troubled by proposed market access requirements that would bar or limit participation by companies that are headquartered, owned or controlled outside the EU. They warned those provisions could materially affect their members’ ability to take part in Europe’s 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," the groups said in a joint letter to EU ministers.
In their letter, the associations argued that such an approach risks reducing opportunities for companies that have been investing in Europe’s digital development. They cautioned that tighter rules around how services are sourced or deployed could restrict customer choice, introduce operational inefficiencies, push up costs, and complicate cross-border business models.
The groups specifically urged EU member states and the European Parliament to ensure that the Cloud and AI Development Act - referred to as CADA in their correspondence - is revised in a way that is consistent with the principles of non-discrimination, proportionality and openness to key trading partners. The trade associations described CADA as a central element of the EU’s broader technology sovereignty agenda.
While the European Commission’s proposals are framed as measures to nurture domestic capacity in strategic digital sectors, the warnings from foreign trade bodies highlight tensions between pursuing local industry development and maintaining access for established international suppliers.
As the legislative process moves forward, the concerns raised by these trade associations will be part of the discussions EU ministers and lawmakers must weigh when shaping the final form of the rules. The outcome will determine how market access conditions apply to non-EU companies providing cloud, AI and software services in Europe.
Context and next steps
- EU telecoms ministers will discuss the Commission’s proposal on Tuesday, with further negotiations expected with EU countries and the European Parliament.
- The trade associations have called for revisions to CADA to uphold non-discrimination, proportionality and openness toward trade partners.
- The debate centers on balancing the EU’s objective to foster domestic tech industries against preserving market access for non-EU suppliers.