Calls for an EU-wide digital services tax are growing, as Pasquale Tridico, chair of the European Parliament’s subcommittee on tax matters, urged Brussels to act despite strong opposition from the US. He argued that such a measure would make Europe’s tax system fairer in a market dominated by foreign tech firms.
Tensions have increased as Washington threatens tariffs on countries introducing digital taxes targeting major platforms. Existing national levies in countries like France contrast with the absence of a unified EU approach due to member state control over taxation.
The proposal comes amid wider strain in transatlantic relations, with disputes over trade, regulation and influence on EU policymaking. US criticism has also focused on European rules such as the Digital Services Act and the Digital Markets Act.
Supporters argue that a digital tax would apply equally to global companies, not only US firms, while addressing imbalances between sectors. Digital businesses can generate large profits without the same physical costs faced by traditional industries.
Further proposals include new approaches to taxing wealth, reflecting how digitalisation blurs the line between income and capital. Advocates say such reforms are needed to adapt taxation to the modern economy.
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The European Commission has delayed a flagship tech sovereignty package for the second time, according to its latest College agenda. The measures are now scheduled for adoption on 27 May, after previously being postponed from March to April.
The tech sovereignty package includes several major initiatives aimed at strengthening EU tech sovereignty, such as the Cloud and AI Development Act, the Chips Act 2, an open-source strategy, and a roadmap for digitalisation and AI in energy. European Commission officials have not provided a reason for the latest delay.
The Cloud and AI Development Act is expected to define what constitutes a ‘sovereign’ cloud and simplify rules for building data centres. The proposal is designed to accelerate infrastructure development as Europe seeks to compete in the global AI race.
Chips Act 2 will follow up on the EU’s earlier semiconductor strategy, which struggled to boost domestic chip production significantly. The new proposal is expected to refine industrial policy efforts to reduce reliance on foreign suppliers.
Meanwhile, the planned open source strategy aims to support European software ecosystems and reduce dependence on large US technology firms. By encouraging commercially viable open source projects, the EU hopes to strengthen its long-term digital autonomy.
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AI agents are rapidly gaining traction, raising questions about whether existing EU rules can keep pace. Unlike chatbots, these systems can act autonomously and interact with digital tools on behalf of users.
Experts warn that AI agents require deeper access to personal data and online services to function effectively. Regulators in Europe are monitoring potential risks as the technology becomes more integrated into daily life.
Lawmakers are examining whether current legislation, such as the AI Act and GDPR, adequately covers agent-based systems. Legal experts highlight challenges around contracts, liability and accountability when AI acts independently.
Despite concerns, many governments remain reluctant to introduce new rules, citing regulatory fatigue. Policymakers may rely on existing frameworks unless major incidents force a reassessment of AI oversight.
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The European Union imposed sanctions on two China-based companies and one Iranian company in connection with cyber operations targeting the EU member states. The Council’s official press release does not specify the underlying operations. The designated entities are Integrity Technology Group and Anxun Information Technology, both based in China, and Emennet Pasargad, based in Iran.
According to an EU statement, Integrity Technology is assessed to have facilitated the compromise of over 65,000 devices across six member states. Anxun is assessed to have provided offensive cyber capabilities targeting critical infrastructure, and two of the company’s co-founders have been individually designated for their roles in these operations.
Emennet is assessed to have a compromised digital advertising infrastructure to disseminate disinformation during the 2024 Paris Olympics.
The sanctions entail an asset freeze and a travel ban for the listed individuals. The EU citizens and entities are additionally prohibited from making funds available to the designated companies.
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X has submitted a compliance proposal to the European Commission outlining how it intends to modify its blue check verification system following regulatory concerns under the Digital Services Act.
The EU regulators concluded that the platform’s system allowed users to obtain verification simply by paying for a subscription without meaningful identity checks, potentially misleading users about the authenticity of accounts.
The Commission imposed a €120 million fine in December and gave the company 60 working days to propose corrective measures. Officials confirmed that X met the deadline for submitting a plan, which regulators will now assess.
The platform, owned by Elon Musk, must also pay the penalty while the Commission evaluates the proposed changes. The company has challenged the enforcement decision before the EU’s General Court.
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In the EU, France is calling for planned European AI ‘gigafactories’ to focus on testing and scaling European technologies rather than primarily increasing demand for hardware from companies such as Nvidia.
The large computing facilities are intended to provide the infrastructure needed to train advanced AI systems. However, officials in France argue that the projects should strengthen Europe’s technological capabilities rather than reinforce reliance on foreign suppliers.
Several EU countries, including Poland, Austria and Lithuania, support using the infrastructure to improve Europe’s digital resilience.
The initiative forms part of the European Commission’s wider plans to expand computing capacity and support the development of a stronger European AI ecosystem.
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The European Council has proposed AI Act amendments, banning nudification tools and tightening rules for processing sensitive personal data. The move represents a key step in streamlining the continent’s digital legislation and improving safeguards for citizens.
Council officials highlighted the prohibition of AI systems that generate non-consensual sexual content or child sexual abuse material. The measure matches a European Parliament ban, showing strong support for tighter AI controls amid misuse concerns.
The proposal follows incidents such as the Grok chatbot producing millions of non-consensual intimate images, which sparked a global backlash and prompted an EU probe into the social media platform X and its AI features.
Other amendments reinstate strict rules for processing sensitive data to detect bias and require providers to register high-risk AI systems, even if claiming exemptions. Negotiations between the Council and Parliament will finalise the AI Act’s updated measures.
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Members of the European Parliament have reached a preliminary political agreement on amendments to the EU Artificial Intelligence Act. The compromise will be reviewed by parliamentary committees before a scheduled vote in Brussels.
Lawmakers in the EU agreed to extend compliance deadlines for some high risk AI systems. The changes aim to give companies and regulators more time to prepare technical standards and enforcement frameworks.
The proposed amendments also include a ban on AI systems that create non consensual explicit deepfakes. Officials in the EU say the measure aims to strengthen consumer protection and improve online safety for children.
Industry groups in the EU have raised concerns about compliance burdens linked to the revised rules. Policymakers in the EU continue negotiations as the legislation moves toward committee approval.
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More than 200 civil society organisations have urged the European Commission to deliver strong consumer protections through the upcoming Digital Fairness Act. Advocacy groups in the EU say the proposal must address risks created by modern online platforms.
Campaigners argue that many existing EU consumer laws were designed decades ago and no longer reflect the realities of the digital market. The coalition warned policymakers in the EU not to treat regulatory simplification as a path toward deregulation.
Advocates are pushing for binding rules targeting deceptive design practices and addictive digital features. Survey responses across the EU show broad public support for stronger protections against dark patterns and unfair personalisation.
The European Commission is expected to present the Digital Fairness Act later this year. Officials in the EU are also considering expanding enforcement powers to strengthen consumer safeguards online.
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Competition authorities in the EU are broadening their oversight of the AI sector, examining every layer of the technology’s value chain.
Speaking at a conference in Berlin, Teresa Ribera explained that regulators are analysing the full ‘AI stack’ instead of focusing solely on consumer applications.
According to the competition chief, scrutiny extends beyond visible AI tools to the systems that support them. Investigations are assessing underlying models, the data used to train those models, as well as cloud infrastructure and energy resources that power AI systems.
Regulatory attention has already reached the application layer.
The European Commission opened an investigation in 2025 involving Meta after concerns emerged that the company could restrict competing AI assistants on its messaging platform WhatsApp.
Following regulatory pressure, Meta proposed allowing rival AI chatbots on the platform in exchange for a fee. European regulators are now assessing the proposal to determine whether additional intervention is necessary to preserve fair competition in rapidly evolving digital markets.
Authorities have also examined concentration risks across other parts of the AI ecosystem, including the infrastructure layer dominated by companies such as Nvidia.
Regulators argue that effective competition oversight must address the entire technology stack as AI markets expand quickly.
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