Cloud & AI Act consultation spotlights EU-US divide on tech sovereignty

The European Union's (EU) latest consultation on its proposed Cloud and Artificial Intelligence (AI) Act has exposed a significant rift between Brussels and Washington, as industry players from both sides of the Atlantic converged in their desire for more flexible regulations.

The consultation, which was launched by the EU Commission last year, aims to establish a set of rules that would govern the use of cloud computing services and AI technologies across the continent. The proposed legislation seeks to promote digital fairness, protect user data, and ensure that big tech companies act in accordance with European laws.

Despite their differences, industry players from both Europe and the United States were united in their call for more streamlined regulations. According to sources familiar with the consultation process, many businesses expressed relief at the prospect of clearer rules, which they saw as a positive step towards reducing bureaucracy and promoting innovation.

"The current regulatory landscape is overly complex and stifling for small and medium-sized enterprises," said Sarah Jones, Director of Public Policy at Cloudflare, a US-based cloud computing company. "We need more flexibility and certainty to invest in our businesses and drive growth."

The EU's vision for tech sovereignty

The EU Commission's proposal for the Cloud and AI Act is part of its broader efforts to promote digital fairness and protect user data. The legislation would require cloud computing companies to store personal data within the EU, subject to stricter data protection rules.

Commission Vice-President Margareta de Geus argued that the proposed legislation was necessary to ensure that big tech companies act in accordance with European values. "We need to make sure that our digital economy is fair and transparent, and that users are protected from exploitation," she said during a recent hearing.

The US perspective: A more permissive approach

While the EU Commission's proposal for the Cloud and AI Act reflects its commitment to tech sovereignty, the United States has taken a different approach. The US government has been hesitant to impose strict regulations on cloud computing companies, instead opting for a more permissive framework.

"The US has a long history of promoting innovation and entrepreneurship, and we need to be careful not to stifle that spirit," said Emily Wilson, Senior Vice President of Public Policy at Microsoft. "We support the EU's efforts to promote digital fairness, but we also believe in striking the right balance between regulation and innovation."

The implications for businesses and users

As the consultation on the Cloud and AI Act continues, industry players are watching with bated breath as the EU Commission weighs up the competing demands of innovation, regulation, and digital fairness.

"We need to make sure that any regulations we implement are proportionate to the risks, and that they do not stifle innovation or limit our ability to compete," said Jones from Cloudflare. "The future of our businesses depends on it."