EU looks set to block companies from working on sensitive technology in China – POLITICO


BRUSSELS – The European Union on Tuesday unveiled plans to prevent European companies from developing sensitive technologies such as supercomputers, artificial intelligence and advanced microchips in countries such as China.

The European Economic Security Strategy, unveiled by Commission President Ursula von der Leyen, outlines Brussels’ plan for how European companies can invest and trade in countries around the world. EU heads of state and territory are expected to discuss the proposals in the 14-page strategy paper obtained by Politico’s Brussels Playbook at their June 29-30 summit.

The document avoids any specific mention of China – but it is clear that Beijing, along with Russia, are the main targets. The paper mentions the danger of “over-reliance on a single country, especially one with systemically different values, models and interests”.

The document follows themes from China where “de-risking” was a major talking point at last month’s G7 summit.

The EU should prevent foreign investment in narrowly advanced technologies that could increase the military and intelligence capabilities of actors that could threaten international peace and security. and secure handling of confidential information,” the paper said.

The European Union proposes to strengthen control in three areas: foreign investment screening (control when foreign companies buy important companies or infrastructure in Europe); export controls (when EU companies sell things like weapons or spy software to hostile countries); and expense investment filter.

Currently, national governments determine export controls. Earlier this year, the Netherlands banned shipments of microchip manufacturing equipment to China under pressure from the US.

The new economic security strategy includes plans to create new powers to regulate the outsourcing of key industries and technologies to potentially problematic countries in Brussels, and the commission plans to introduce legislation to stop companies moving supply chains to autocracies for “advanced technologies”. .

The reasoning behind the move is that companies could outsource much of their supply chains to countries like China, putting Europe’s intellectual property and national security at risk. Under the new law, the EU can ban those foreign investments when it sees security risks.

The document specifically mentions “quantum computing” (which can be used to break highly secure communications), “artificial intelligence” and “advanced semiconductors” as areas where the EU will ban exports.

In practice, this means that car factories can be outsourced; But they’re not password-cracking supercomputers.


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