Tuesday | 20 Oct 2020
19 Feb 2020

Europe’s digital independence day

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If 2020 is, as many define it, the ‘super year’, then 19 February is likely to stand out as a ‘super day’, at least for what concerns EU digital policy. With the adoption of a comprehensive, almost overwhelming package of proposed reforms, including an ambitious data strategy and a White Paper on Artificial intelligence (AI), the European Commission has cast the die. Alea iacta est: there is no turning back.

There is a lot to digest in the new package, but it is clear the Commission is ready to stand firm: whoever wants to play in Europe, has to pay (taxes) in Europe, and abide by European rules. Today’s plan thus has the twofold aim to return value from tech giants to users and industrial players; and to ‘repatriate’ data from US and Chinese cloud giants to Europe. Several actions seek to fulfil these goals, including digital taxation (on which the European Commission is ready to act, should the OECD fail to reach a good deal); new legislation, including a Data Act and the Digital Services Act; reformed competition rules (with a forthcoming sector inquiry on digital platforms); and importantly, a strong commitment to keep industrial data in European hands.

This strategic move has a strong rationale. Brussels expects a paradigm shift, from a cloud-dominated environment to a much more distributed data governance. In the years to come, EU Commissioner Thierry Breton asserts, the current 80/20 situation (80% of data stored in the cloud, 20% locally) will convert into a 20/80 scenario (with 80% of the data being locally stored, in devices, cyber-physical objects, edge computing etc.). Platforms may then become less dominant, and Europe will have a chance to compete in this environment through a brand new infrastructure based on a federated cloud (possibly scaling up national initiatives such as GAIA-X); dedicated data spaces in key sectors (manufacturing, health, mobility); and open data from public institutions and research projects. All fueled by a new Public-Private Partnership on AI that will nurture Europe’s specialised knowledge, especially in robotics and ‘embedded AI’.

The European Commission appears determined to enact a comprehensive, yet proportionate regulatory framework on AI. Based on the work of the EU High-Level Expert Group on AI (full disclosure: I am one of the group members), which defined legal, ethical and technical requirements for ‘trustworthy AI’, the new AI White Paper contemplates the adoption of a flexible, agile regulatory framework limited to ‘high-risk’ applications, in sectors such as healthcare, transport, police and the judiciary; and focusing on provisions related to data quality and traceability, transparency and human oversight. This framework will need to be monitored and governed with the help of a new body responsive to developments, mandated to constantly update the list of high-risk applications. The Commission does not aim to regulate AI applications that do not present specific risks, and seems willing to keep highly prescriptive regulation at bay. There is, for now, no sign of a moratorium on facial recognition applications in public spaces; but there is room for stricter requirements on remote biometric identification systems, deemed to create particular concerns for the protection of users’ fundamental rights.

Between the lines, the impressive list of proposals reads like a declaration of independence for the digital age. A long-awaited one: over the past three decades, the Commission suffered from an inferiority complex when it came to digital technology and innovation. But Europe has recently raised its profile in the digital sphere, especially following the enactment of the General Data Protection Regulation, now echoed by legislation in Brazil, Japan, and California. Not surprisingly, global tech leaders and government representatives are increasingly frequent visitors to Brussels, ready to discuss future policy orientations, and even proactively demanding regulatory guidance at times.

The proposed measures portray an extremely ambitious policy strategy. Part of them represent the Commission’s commitment to build a “Europe fit for the digital age” (the portfolio of Vice-President Margrethe Vestager). But some of the proposals appear aimed instead at “making the digital age fit for Europe”. Here is the big bet: the EU’s strategy will not be effective unless Europe plays a pivotal role on the global stage, possibly convincing like-minded countries to agree on common rules for responsible AI, an overall framework for enhanced trust in the digital infrastructure, and meaningful aid to developing countries on how to leverage the outstanding potential of digital transformation. This declaration of independence should thus serve to enhance Europe’s role in building trust rather than merely to ring-fence Europe’s Single Market, and thereby build new walls in an already too fragmented, increasingly hectic global order.