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REGULATION AND INDUSTRIAL POLICY, KEY ELEMENTS FOR EUROPE'S STRATEGIC DIGITAL AUTONOMY







As a key player on the geopolitical chessboard, the digital realm is now entering an era of unprecedented innovation. In this battle for power and influence, France and the European Union have chosen to prioritize regulation as a strategic lever to bridge their lag, regain power against American giants, and carve out a place in the new strategic sectors. However, despite these efforts, technological dependencies persist and remain profound.



Europe, as a normative and regulatory superpower, is deploying an ambitious digital roadmap marked by comprehensive regulatory frameworks such as the Digital Services Act (DSA) and the Digital Markets Act (DMA), aimed at regulating digital services and promoting fair competition.


Simultaneously, the Commission has also proposed the Data Governance Act and the Data Act, addressing data governance and data protection within the European Union. Finally, Europe has adopted the Artificial Intelligence Act (AI Act), establishing a hierarchy of risks related to artificial intelligence.


These regulations reflect Europe's determination to uphold its core values and assert its vision of technology within its territory. In this regard, it is worth noting the parallel with the GDPR, which put the EU on the global map of digital issues.


However, the implementation of these regulations raises questions in terms of skills, resources, and governance. There is also the issue of regulatory scalability, the regulatory framework in the face of the rapid development of technologies.


This normative strategy, while essential, is not sufficient to restore balance in the distribution of digital power on a fragmented global chessboard where the United States and China are in conflict. It is crucial to complement this defensive approach with a strong and strategic industrial policy that goes beyond mere imitation of American practices.


This article explores the dilemmas Europe faces in preserving its sovereignty against technological giants and proposes avenues for reflection on institutions and technology-related policies.



I. Rethinking Institutions in the Face of Digital Giants and New Instruments of Power


A. Challenging the Foundations of the Rule of Law


The rise of digital giants and the rapid development of technologies raise questions about the foundations of the rule of law.


Their increasing influence in areas such as online surveillance and data collection raises concerns about the preservation of individuals' fundamental rights.


Content moderation has become a crucial responsibility for technology platforms, as they play a vital role in the dissemination of information and the management of online discourse. However, the power of these digital behemoths in making decisions about what is allowed or not on their platforms (as seen in the case of Twitter) raises concerns about censorship, freedom of expression, and diversity of opinions. The question arises as to whether these companies should be considered mere neutral intermediaries or if they should assume greater responsibility in safeguarding fundamental rights.


Furthermore, the massive collection of data by these technology actors raises significant questions regarding privacy and the protection of personal data. Data has become a valuable resource, fueling artificial intelligence and algorithms that support numerous online services. However, the scale and scope of this data collection raise concerns about confidentiality, the protection of individuals' privacy, and the potential for widespread surveillance.



B. Regulation and Governance of Global Technology Actors


Regulating digital giants and governing their activities are major challenges for Europe. In the face of the growing influence of these actors, it is necessary to establish clear and appropriate rules to regulate their practices and protect users' rights.


In pursuit of this objective, the European Union has proposed regulations such as the Digital Services Act (DSA) and the Digital Markets Act (DMA).


The DSA aims to establish harmonized rules for digital services, particularly concerning content moderation and algorithm transparency. On the other hand, the DMA aims to promote fair competition by identifying and regulating actors with significant market power. These legislative proposals are intended to create a safer, fairer, and more transparent digital environment for users.


However, implementing these regulations requires substantial skills and resources. Governments and regulatory authorities need to be able to understand and keep pace with rapid technological advancements while having the necessary means to enforce the rules, including the creation of new independent public authorities for protection and oversight.


Effective coordination among different European countries is also crucial to harmonize approaches and ensure consistent regulation across the European Union.


In summary, the questioning of the foundations of the rule of law by the rise of technology giants and the challenges posed by their regulation and governance require special attention from Europe. It is essential to strike a balance between technological innovation, the protection of fundamental rights, and the promotion of fair competition to ensure a safe digital future that upholds European values.



II. Technological Dependency: A Major Geopolitical Issue


A. Dependency on American Actors


Europe faces technological dependency on American actors, jeopardizing its digital sovereignty. Technology giants based in the United States, such as the "GAMAM" (Google, Apple, Meta, Amazon, Microsoft), hold a dominant position in numerous key domains, ranging from online services to advanced technologies like artificial intelligence and cloud computing.


This dependency means that Europe relies on the infrastructure, services, and technological standards developed by these American actors, raising significant concerns regarding security, data privacy, and sovereignty.


B. The Urgency of Addressing Dependency and Preserving European Digital Sovereignty


To preserve this sovereignty, it is imperative for Europe to reduce its dependency and strengthen its technological capabilities.


Technological dependency exposes Europe to risks such as privacy breaches, information manipulation, and loss of control over critical infrastructure and services. Furthermore, this dependency compromises the competitiveness of European companies on the global stage and limits their ability to innovate and develop new technologies.


C. Europe's Defensive Normative Strategy and its Relative Effectiveness


In response to this dependency, Europe has adopted a defensive normative strategy focused on regulating global technology actors. Initiatives such as the General Data Protection Regulation (GDPR) and the Digital Services Act (DSA) aim to establish clear rules and promote fair competition in the digital realm.


However, while fundamental, this normative approach may prove insufficient in establishing balance on the fragmented global chessboard where the United States and China are in conflict.



III. Beyond Regulation


A. Toward a Visionary and Robust European Industrial Policy


To restore balance in the distribution of digital power, Europe must develop a visionary industrial policy and avoid simply following the American model or the path of dominant actors. Being a mere "follower" in the technology race already signifies defeat.


It is crucial for Europe to identify the battles to fight and the technological sectors where it can become indispensable and create "choke points" in the global technological chain. Those who control these so-called "choke point technologies" (such as semiconductors) enjoy a significant strategic advantage with effects throughout an interdependent value chain.


B. Identifying Strategic Sectors


Europe must identify strategic sectors in which it can position itself to maintain a balance of power and avoid consistently losing ground. Areas such as artificial intelligence, electronics, quantum computing, cybersecurity, and other advanced technologies can provide opportunities for Europe to differentiate itself and become indispensable.


However, it is necessary to define these technological sectors on a case-by-case basis, evaluating their potential, interdependencies, and alignment with Europe's core values.


C. Defining an Industrial Policy Promoting Sovereignty and Balance of Power


A robust industrial policy focused on innovation, research, and technological development will enable Europe to strengthen its digital sovereignty and restore the balance of power. This requires massive investments in research and development, coordination or even alliance among member states, businesses, and research institutes, as well as a long-term vision.


Europe must also foster innovation and entrepreneurship by encouraging the creation and growth of competitive European technology companies and supporting collaborative projects at the European scale.




In conclusion, European digital sovereignty represents a major strategic geopolitical challenge that requires a holistic approach. Europe must pursue a dual strategy: a defensive normative approach to regulate global technology actors and a visionary industrial policy aiming to identify strategic sectors where it can position itself as a leader in the global technological chain.


These two approaches must complement each other to ensure a robust and sustainable digital autonomy. Europe must strengthen its technological governance, invest massively in research and development, and promote innovation and entrepreneurship.


By combining effective regulation with ambitious industrial policy, Europe can solidify its position in the new global technological order, preserve its sovereignty, and defend its core values. However, achieving this positioning will require strong political will (which is the main challenge today) and concerted action to address the strategic geopolitical challenges at hand.



Hannan Otmani Attorney-at-Law, Paris Bar Founder of Wiser Avocats and DeLeX Consortium Author





Régulation et politique industrielle, clés de l'autonomie stratégique numérique de l'Europ
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