Priority 2 - A Europe fit for the Digital Age

Prio2_Digitalisierung
© European Union, 2021

Data Protection

Better Access to Online Goods for Consumers and Businesses

The Right Environment for Digital Networks and Services

Economy and Society

European Commission Work Programme 2022

Cyber Resilience

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Legislative, incl. impact assessment, Q3 2022.

Semi-Conductors

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Proposal: On 8th of February 2022, the Commission presented a Proposal for a Regulation establishing a framework for actions to strengthen the European semiconductor ecosystem (press release).

Problem: Digitalisation is moving into all areas of life. This increases the need for semiconductors in particular, whose demand is currently greater than the market, however, with supply bottlenecks additionally lead to a shortage of availability. The shortage of semiconductors is having a serious impact on industrial companies worldwide. Many European sectors, including automotive, energy, communications and health, and strategic sectors such as defence, security and space are threatened by such supply shortages. At the same time, counterfeit chips are appearing on the market, threatening the security of electronic devices and systems. The semiconductor shortage has exposed structural weaknesses in the European value chain and Europe's dependence on third countries. Despite its strong global position in the production of materials and equipment, the Union is heavily dependent on third country suppliers for the design, manufacture, packaging, testing and assembly of chips.

Objective: The proposal aims to achieve the strategic objective of increasing the resilience of the European semiconductor ecosystem and its global market share. The proposal also aims to facilitate the early introduction of new chips by the European industry and increase its competitiveness. To achive this, the European chip industry needs to attract investment in innovative production facilities and have a skilled workforce, but also be able to design and manufacture state-of-the-art chips. The objectives of the Regulation are summarised in three pillars: 1. "Chips for Europe Initiative", 2. "Security of supply" and 3. "Monitoring and crisis response".

Subject matter: To implement the objectives, the "Chips for Europe" initiative will support large-scale technological capacity building and innovation, in particular in the form of an innovative virtual design platform that will foster collaboration between user communities and the development sites. The initiative will also develop pilot prototyping facilities and establish a network of competence centres to support stakeholders with sufficient expertise. A chip fund will be established to increase the availability of funds to support growth and investment along the entire semiconductor value chain.
To ensure security of supply, investments will be driven and improved production capacity in semiconductor manufacturing and advanced packaging, testing and assembly will be ensured through first-of-a-kind Integrated Production Facilities and Open EU Foundries. In addition, jointly developed standards and certifications will identify sector-specific requirements for trustworthy chips to ensure cybersecurity.
The creation of a coordination mechanism between the member states and the Commission is intended in particular to monitor the semiconductor value chain and to enable rapid responses to disruptions in the supply of semiconductors by means of a crisis-stage system.

Security and Defence

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Non-legislative, Q1 2022.

Innovative and Sustainable Space

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Legislative, incl. impact assessment, Article 189 TFEU, Q2 2022.

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Non-legislative, Q2 2022.

Digital in Education and Skills

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Non-legislative, Q3 2022.

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Non-legislative, Q3 2022.

Single Market

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Legislative, incl. impact assessment, Q1 2022.

Multimodal Digital Mobility

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Legislative, incl. impact assessment, Article 91 TFEU, Q4 2022.

European Commission Work Programme 2021

Europe’s Digital Decade

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Non-legislative Act: On the 9th of March 2021, the European Commission published a Communication on 2030 Digital Compass: the European Way for the Digital Decade (press release).

Problem: The COVID-19 pandemic has not only accelerated the pace of digitalisation in societies and economies, but further exposed the vulnerabilities of the digital space, its dependencies on non-European technologies, and the impact of disinformation on democratic societies.

Objective: In the Digital Compass 2030, the Commission formulates four concrete objectives to achieve its digitisation efforts: promoting a digitally skilled population with highly skilled digital professionals, advancing the digital education system and securing sustainable digital infrastructures, enforcing the digital transformation of businesses, and lastly digitalizing public services.

Subject Matter: All European households shall be equipped with a gigabit network and all populated areas shall equipped with 5G networks. The production of advanced and sustainable semiconductors in Europe is to be optimised in addition to the cross-Europe deployment of 10,000 carbon-neutral, high-security edge nodes to ensure low-latency (a few milliseconds) access to data services wherever businesses are located. By 2025, Europe should have a first computer with quantum acceleration, paving the way for Europe to be at the forefront of quantum capabilities by 2030. By 2030, 75 per cent of European companies are expected to use cloud computing services, Big Data, and artificial intelligence. In addition, more than 90 per-cent of European SMEs should have achieved at least a basic level of digital intensity Digitisation of public services. By 2030, EU citizens should be able to view an electronic version of their medical records. Online provision of key public services shall be available to European citizens and businesses by 2030. 80 per cent of EU citizens shall use a digital ID solution by 2030. To achieve the Digital Compass goals, the European Commission is pursuing the implementation of a governance structure with annual reporting and tracking. The Commission intends to propose the Digital Compass objectives in the form of a digital policy program to be adopted in an ordinary legislative procedure, focusing on implementation and ongoing commitment to the common digital objectives.

Data Package

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Proposal: On the 23rd of February 2022, the Commission proposed a Regulation on harmonised rules on fair access to and use of data, also known as Data Act (press release).

Problem: The volume of data is constantly growing, from 33 zettabytes generated in 2018 to 175 zettabytes expected in 2025. It is an untapped potential but, 80 per cent of industrial data is never being used.

Objective: The aim of the Data Act is ensuring fairness in the allocation of value from data among actors in the data economy and to foster access to and use of data. Therefore, it addresses legal, economic and technical issues that lead to data being under-used in the past. The new rules shall make more data available for reuse and are expected to create 270 billion euros of additional GDP by 2028. The proposal’s specific objectives are (1) Facilitating access to and the use of data by consumers and businesses, while preserving incentives to invest in ways of generating value through data; (2) Providing for the use of data by public sector bodies and Union institutions, agencies or bodies of data held by enterprises in exceptional situations; (3) Facilitating switching between cloud and edge services; (4) Putting in place safeguards against unlawful data transfer without notification by cloud service providers; (5) Providing for the development of interoperability standards for data to be reused between sectors.

Subject matter: With the help of this Regulation (1) legal certainty shall increase in order to generate a more transparent and easier access to the data for consumer and businesses. Manufacturers and designers are to be transparent on what data will be accessible and how it can be accessed. Obligations to make data available shall be fair and non-discriminatory, and any compensation will have to be reasonable. Guarantees that contractual agreements on data access and use do not take advantage of imbalances in negotiating power between the contractual parties shall be ensured by an unfairness test, including a general provision defining unfairness of a data sharing-related contractual term complemented by a list of clauses. (2) In situations where public sector bodies have an exceptional need to use certain data (i.e. public emergencies), a framework shall make data available for public sectors bodies to use for free. To ensure that the right to request data is not abused, the requests for data would need to be proportionate, clearly indicate the purpose, and respect the interests of the enterprise making the data available. (3) Minimum regulatory requirements for providers of cloud, edge and other data processing services, shall enable customers to switch between services. Therefore, this proposal shall ensure a minimum level of functionality after switching to another provider. (4) In order to prevent unlawful data transfer, providers are to be obliged to take all reasonable technical, legal and organisational measures to prevent such access. (5) For an interoperability use of data, requirements shall promote a seamless multi-vendor cloud environment by allowing interoperability between operators of data spaces and data processing services.

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Legislative, incl. impact assessment, Article 114 TFEU, Q3 2021.

Digital levy

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Legislative, incl. impact assessment, Q2 2021.

Digital for Consumers

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Legislative procedure completed: On June 7th 2022, the European Parliament and the EU member states reached an agreement on the Directive in relation to a common charging solution. The Directive, adopted in September 2021, is expected to enter into force in summer 2023.  (press release).
Following the agreement, all charging connectors will have to be harmonised by 2024, except for those of laptops (not until 2026), with the USB-C charging connector introduced as a single charging connector. Furthermore, in view of the rapid technological development, the Commission will, in addition to its initial proposal, evaluate the different contactless charging technologies available and invite the European standardisation organisations to translate the most appropriate solution into a harmonised standard, thus paving the way for harmonised wireless charging of terminals.

Proposal: On the 23rd of September 2021, the European Commission published a Proposal for a Directive to harmonize the laws of the member states relating to the making available on the market of radio equipment (press release).

Problem: Consumers often have the problem that they do not have a suitable charger to land their electronic device. As a result, consumers spend an average of 2.4 billion euros on separate chargers that are not supplied with electronic devices. Consequently, disposed and unused charging devices are estimated to generate up to 11,000 tons of e-waste per year.

Objective: With this proposal for a Directive, the Commission aims to ensure standardization of charging interfaces for wired rechargeable cell phones and similar categories of radio equipment for all relevant devices. This should lead to greater consumer convenience and at the same time ensure a reduction of e-waste. Therefore, the sale of chargers and electronic devices will be unbundled. Thus, consumers will not be forced to purchase a new charger when buying a new electronic device.

Subject Matter: To harmonize charging ports and fast charging technology, the USB Type-C port is to become the standard port for all smartphones, tablets, cameras, headphones, portable speakers and portable video consoles. As soon as these require a voltage of more than 5 volts, a current of more than 3 amps or a power of more than 15 watts, they must support the USB Power Delivery (USB PD) charging protocol, as it is then a fast charge function. Therefore, for better consumer convenience, information about the charging power characteristics as well as the power supply of the chargers should be provided. A transitional period of 24 months after entry into force should make it easier for companies to implement the revised requirements. To review the Directive, the Commission is to submit a report to the European Parliament and the Council by two years after the Directive becomes applicable and report on the progress every five years thereafter.

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Legislative, including impact assessment' Article 114 TFEU, 4th quarter 2020.

  A Trusted and Secure European e-ID

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Proposal: On the 3rd of June 2021, the European Commission published a Proposal for a Regulation amending Regulation (EU) No 910/2014 as regards establishing a framework for a European Digital Identity (press release).

Problem: In the course of an evaluation, it was revealed the current eIDAS does not address new market demands, mostly due to its inherent limitations to the public sector, the limited possibilities and the complexity for online private providers to connect to the system, its insufficient availability of notified eID solutions in all member states and its lack of flexibility to support a variety of use cases. Additionally, privacy and date protection concerns were raised.

Objective: The Regulation shall enable EU citizens to use personal identification data to identify themselves in online and offline services across Europe. In addition, it will give EU citizens the possibility to store credentials linked to their identity, make them available to trusted parties on request as well as to sign them by using a qualified electronic signature. This would apply to documents such as university transcripts, birth certificates, or medical records. The European digital identity wallet is not a mandatory application for EU citizens; it is simply intended to facilitate identification in other EU countries and to guarantee access to a wide range of public and private services.

Subject Matter: In order to establish a pan-European infrastructure, member states must provide and accept the proof of identity from each other and establish validation mechanisms based on common technical standards. Further requirements include that users ought to have full control over their wallet. The issuer is not allowed to collect information about the use of the wallet, nor is he/she allowed to combine personal identification data and other personal data stored in the wallet – something which could allow abusers to draw conclusions on the user’s behaviour. Within six months after the entry into force of the Regulation, the Commission is required to present technical and operational specifications for the establishment of the wallet. After 12 months, all member states will be able to issue wallets. After 24 months, the Commission is obliged to conduct an implementation review and present it to the Council and European Parliament in the form of an evaluation report. The total funding required to implement the proposal over the period 2022-2027 is up to 30,825 million euro, including 8,825 million euro in administrative costs and up to 22 million euro in operational expenditure covered by the Digital Europe program.

Platform workers

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Proposal: On the 9th of December 2021, the Commission proposed a Directive on improving the working conditions in platform work. (press release)

Problem: The digital transition, accelerated by the COVID-19 pandemic, has increased the importance of digital labour platforms. This means, even though digital labour platforms open up many opportunities, it also introduces a new form of work organization which challenge existing rights and obligations related to labour law. According to one estimate, up to five and a half million people working through digital labour platforms could be at risk of employment status misclassification. Those people are most likely to experience poor working conditions and inadequate access to social protection. Moreover, digital labour platforms use algorithmic management systems. It creates efficiencies in the matching of supply and demand but has also a significant impact on working conditions in platform work. It is so far unregulated phenomenon in the platform economy that poses challenges to both workers and the self-employed working through digital labour platforms.

Objective: With the help of this Directive, the Commission aims to improve the working conditions and social rights of people working through platforms. This means (1) to ensure that people working through platforms have the correct employment status and gain social protection rights. Moreover, (2) ensuring fairness, transparency, and accountability in algorithmic management and (3) to enhance transparency, traceability, and awareness of developments in work as well as improving enforcement of the applicable rules for all people working through platforms.

Subject matter: In order to tackle the misclassification of employment status, the Commission aims to establish a framework including an appropriate procedure to ensure correct determination. This legal presumption shall apply in all legal and administrative proceedings. To ensure transparency and fairness in algorithmic management, the Commission introduces new material rights for people performing platform work. Moreover, establishing appropriate channels for discussing and requesting review of decisions made by an algorithmic management system shall ensure fairness, accountability, and safeguarding basic workers’ rights and health and safety at work of significant decisions taken or supported by automated systems. Furthermore, clarified obligations for digital labour platforms shall be implemented to enhance transparency and traceability of platform work. The Directive shall also improve labour and social protection authorities’ knowledge of which digital labour platforms are active in their member state.
Member states shall be obligated to transpose this Directive two years after it enters into force.

Foreign Subsidies (Follow-up to the White Paper on Foreign Subsidies)

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Legislative procedure completed: On June 30, 2022, the European Parliament and the EU Member States reached an agreement on the Regulation on third-country subsidies that distort competition (press release). The aim of the regulation is to ensure fair conditions for all companies operating in the EU internal market. Furthermore, distortions due to third-country subsidies are to be prevented. From now on, the EU may examine financial contributions that companies operating in the EU receive from public institutions of a non-EU state in order to prevent the distorting effects of such subsidies on competition.

Proposal: On the 5th of May 2021, the European Commission published a Proposal for a Regulation on foreign subsidies distorting the internal market (press release).

Problem: EU’s internal market has been increasingly distorted by foreign subsidies, creating an uneven playing field for competition. Facilitating the acquisition of EU undertakings, foreign subsidies have influenced investment decisions, distorted trade in services or otherwise influenced the behaviour of their beneficiaries in the EU market, to the detriment of fair competition.

Objective: The European Commission aims to eliminate distortions in the single market caused by subsidies from third countries. Therefore, it introduces several counter measures and new rules concerning companies that carry out an economic activity in the internal market. Thus, the general objective is to restore the level playing field on the internal market. Specific aims on the other hand include identifying the most distortive subsidies and remedying the distortions caused by foreign subsidies.

Subject Matter: The Commission will request necessary information on its own initiative (ex ante approach) and conduct a preliminary examination. If there is sufficient evidence of distortion of the internal market within 90 days, the Commission shall adopt a decision to open an in-depth investigation. As part of the investigation, it shall determine what measures must be implemented to address the distortion. The company concerned can avert these by making a commitment to eliminating the distortion. The Commission will have the right to impose remedies, having the power to impose interim measures if there is a serious risk of a significant and irreparable damage to competition in the internal market. If the Commission finds companies intentionally or negligently withholding or falsifying information, the Commission can impose fines and periodic penalty payments by decision. Furthermore, the draft Regulation pays particular attention to controlling the risk of distorting the market created by subsidies for mergers and public procurement procedures. The total administrative expenditure for the implementation of the proposal over the period 2021-2027 is 90,340 million euro, part of which will be funded by the Single Market Program.

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legislative, incl. impact assessment, Article 207 TFEU, Q2 2021

Industrial Strategy for Europe

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Non-legislative Act: On the 5th of May 2021, the European Commission published a Communication updating the 2020 New Industrial Strategy: Building a stronger Single Market for Europe’s recovery (press release).

Problem: The COVID-19 pandemic that led to several lockdowns and economic slowdowns took a toll on the EU communities and economies, as well as its industries and companies. Further, new vulnerabilities and old dependencies in addition to socio-economic and territorial inequalities were revealed. Due to an increased interdependence of global value chains and the value of a globally integrated Single Market, there is a need for a quicker transition towards a cleaner, more digital, and more resilient economic and industrial model. Thus, given the changed economic and social situation, the strategy has now been revised and adapted to the current situation.

Objective: EU’s industrial strategy will foster Europe’s drive towards sustainable competitiveness by strengthening the resilience of the common internal market, dealing with EU’s strategic dependencies and accelerating the twin transitions. An internal market emergency instrument shall allow a better and faster response in times of crisis. The Commission aims to strengthen internal market governance instruments and procedures, as well as enable more transparency and coordination in EU internal export and service restrictions. Despite any circumstances, it is necessary to uphold the free movement of persons, goods, services, and capital in the Single Market and the need to work together to strengthen its resistance to disruptions. Additionally, investment in deepening integration in the fields which offer the greatest opportunities within the Single Market and new strategies to accompany the twin transitions are proposed. For the businesses, the enforcement of competition rules, in particular State aid rules, will ensure that public funds for the recovery do not replace but trigger additional private investments. Lastly, investing in skills, meaning upskilling and reskilling Europe’s workforce, shall contribute to a fair recovery.

Subject Matter: Structures will be implemented to facilitate the movement of goods and services in the context of border restrictions, as well as faster product availability in times of crisis. It is necessary to identify strategic dependencies and capacities and to implement measures that reduce and prevent strategic dependencies. This includes diversifying trade chains, strengthening alternative supply chains with the closest allies, launching two industrial alliances (2nd Q 2021), the Processors and Semiconductor Technologies Alliance and the Industrial Data, Edge and Cloud Alliance and supporting the development of an Alliance on Space Launchers and a Zero Emissions Aviation Alliance. Moreover, strengthening measures against disruptions and vulnerabilities in small to medium enterprises (SMEs) supply chains (4th Q 2021), adopting a standardization strategy (3rd Q 2021) and developing guidance on identifying and addressing strategic dependencies through public procurement (1st Q 2022) is encouraged. Transformation pathways need to be created in partnership with industry, public authorities, social partners and other stakeholders starting in the areas of mobility and tourism (2Q 2021). In addition, the Commission is pursuing measures to promote renewable power purchase agreements in a proposal for a revised Renewable Energy Directive (2.Q 2021). Furthermore, it considers a European approach to carbon offset contracts in a proposal for a revised ETS Directive (2.Q 2021) and to establish an energy and industrial geography laboratory to develop information on energy infrastructures (to be released in the 4th Q 2021).

Civil, Defence and Space Industries

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Non-legislative Act: On the 22nd of February 2021, the European Commission published a Communication in which it presented an action plan for synergies between the civil, defense and space industries (press release).

Problem: The space, defense and security sectors have not yet extensively exploited potential synergies. This is a result of regulatory obstacles, lack of a level playing field in international markets, lack of access to costly research infrastructure, and need for skilled labor.

Objective: With the help of the Action Plan ("Three-Point Belt Plan"), the goal is to (1) create synergies between EU programs and instruments to increase the efficiency of investments and the effectiveness of results. In addition, (2) support measures (spin-offs) of research and development to achieve economic and technological progress in the areas of defense and space. In this context, (3) the use of research results from civil industry in the defense sector is to be facilitated (spin-ins).

Subject matter: To strengthen synergies between the space, defense and security sectors, the Action Plan presents eleven concrete actions. These include early identification of needs, improving access to funding, support for start-ups, SMEs and RTOs, and technology roadmaps.

Design Requirements and Consumer Rights for Electronics

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Proposal: On the 23rd of September 2021, the European Commission published a Proposal for a Directive to harmonize the laws of the member states relating to the making available on the market of radio equipment (press release).

Problem: Consumers often have the problem that they do not have a suitable charger to land their electronic device. As a result, consumers spend an average of 2.4 billion euros on separate chargers that are not supplied with electronic devices. Consequently, disposed and unused charging devices are estimated to generate up to 11,000 tons of e-waste per year.

Objective: With this proposal for a Directive, the Commission aims to ensure standardization of charging interfaces for wired rechargeable cell phones and similar categories of radio equipment for all relevant devices. This should lead to greater consumer convenience and at the same time ensure a reduction of e-waste. Therefore, the sale of chargers and electronic devices will be unbundled. Thus, consumers will not be forced to purchase a new charger when buying a new electronic device.

Subject Matter: To harmonize charging ports and fast charging technology, the USB Type-C port is to become the standard port for all smartphones, tablets, cameras, headphones, portable speakers and portable video consoles. As soon as these require a voltage of more than 5 volts, a current of more than 3 amps or a power of more than 15 watts, they must support the USB Power Delivery (USB PD) charging protocol, as it is then a fast charge function. Therefore, for better consumer convenience, information about the charging power characteristics as well as the power supply of the chargers should be provided. A transitional period of 24 months after entry into force should make it easier for companies to implement the revised requirements. To review the Directive, the Commission is to submit a report to the European Parliament and the Council by two years after the Directive becomes applicable and report on the progress every five years thereafter.

European Commission Work Programme 2020

Europe fit for the Digital Age

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Non-legislative Act: On the 19th of February 2020 the European Commission published a Communication on Shaping Europe's digital future (press release).

Problem: The twin challenge of a green and digital transformation requires an immediate change of direction towards more sustainable solutions which are resource-efficient, circular and climate-neutral, so that every citizen, every employee, every business person has a fair chance, wherever they live, to reap the benefits of the increasingly digitised society. Furthermore, the arising of digital technologies leads to an increased uncertainty surrounding data protection as well as cybersecurity of critical infrastructure. Therefore, the Commission aspires to reflect on all levels of society as to how Europe can best meet, and continue to meet, these risks and challenges.

Objective: A European society is to be established, one that is powered by digital solutions and that enriches the lives of all by providing people the opportunity to develop personally, to choose freely and safely, to engage in society, regardless of their age, gender or professional background. Businesses shall acquire a framework that allows them to start up, scale up, pool and use data, to innovate and compete or cooperate on fair terms. Europe on the other hand needs to have a choice and pursue the digital transformation in its own way. Key objectives of the Communication include the development, deployment and uptake of technology that makes a real difference to people’s daily lives as well as of a strong and competitive economy that masters and shapes technology in a way that respects European values. A fair and competitive economy shall allow companies of all sizes and in any sector to compete on equal terms, and develop, market and use digital technologies, products and services at a scale that boosts their productivity and global competitiveness. Lastly, allowing an open, democratic and sustainable society is to create a trustworthy environment in which citizens are empowered in how they act and interact, and of the data they provide both online and offline.

Subject Matter: Initiating a White Paper on Artificial Intelligence shall help set out options for a legislative framework for trustworthy AI (adopted together with this Communication), with a follow-up on safety, liability, fundamental rights and data. A Digital Education Action Plan is to boost digital literacy and competences at all levels of education, while a reinforced Skills Agenda and a reinforced Youth Guarantee are to strengthen digital skills throughout society and put a strong focus on digital skills in early career transitions. Proposing an Industrial Strategy Package shall put forward a range of actions to facilitate the transformation towards clean, circular, digital and globally competitive EU industries, including SMEs and the reinforcement of single market rules. A European Data Strategy shall make Europe a global leader in the data-agile economy. In order to support digital transformation and competitiveness of the audiovisual and media sector as well as stimulate access to quality content and media pluralism, a media and audiovisual Action Plan is required. New and revised rules are to deepen the Internal Market for Digital Services, by increasing and harmonising the responsibilities of online platforms and information service providers and reinforce the oversight over platforms’ content policies in the EU. Finally, a Digital for Development Hub shall consolidate a whole-of-EU approach promoting EU values and mobilising EU member states and EU industry, Civil Society Organisations (CSOs), financial institutions, expertise and technologies in digitisation.

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Legislative, incl. impact assessment, Articles 103 and 114 TFEU, Q4 2020.

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Non-legislative Act: On the 30th of September 2020 the European Commission published a Communication on a Digital Education Action Plan 2021-2027, resetting education and training for the digital age (press release).

Problem: In light of the rapid digitalisation, EU’s society, its labour market and the future of work will have to unlock the potential of digital technologies for learning and teaching and to develop digital skills for all. Currently, many employers face difficulties in recruiting highly skilled workers across a number of economic sectors, due to the lack of skilled workers to fill these vacancies. The adequate use of technology is further crucial for achieving the European Green Deal objectives and for reaching climate neutrality by 2050. Additionally, the COVID-19 pandemic exposed the shortcomings that need to be tackled in order for the integration of digital technologies into education and training systems to be successful. Although several initiatives aimed to optimise the use of technologies to provide education and training, they were often short-lived, or limited in scale and had marginal impact at system levels.

Objective: The Commission primarily supports the agenda of high-quality and inclusive education and training for all learners. All learners shall be equipped with digital competences (knowledge, skills, and attitudes) to live, work, learn and thrive in a world increasingly mediated by digital technologies. Action at EU level can promote quality and inclusive education and training by supporting cooperation, the exchange of good practice, frameworks, research, recommendations and other tools. Guiding principles include a high quality and inclusive digital education, which respects the protection of personal data and ethics as well as investments in connectivity, equipment and organisational capacity and skills should ensure that everybody has access to digital education. Increasing equality and inclusiveness are strongly connected to allowing access to digital education to all, specifically to disadvantaged groups, teachers, and families. The Communications advises making digital competence to a required skill for all educators and training, embedding all areas of teacher professional development, including initial teacher education. Basic digital skills, including digital literacy, are essential for a digitalised world to boost the relevance, quality and inclusiveness of European education and training at all levels.

Subject Matter: To achieve the objectives above, there are actions regarding the two strategic priorities: fostering the development of a high-performing digital education ecosystem and enhancing digital skills and competences for the digital transformation. Strategic dialogue with member states shall pave the way for a proposal for a Council Recommendation by 2022 on the enabling factors for successful digital education. Drawing on lessons from the COVID-19 crisis, a Council Recommendation on online and distance learning for primary and secondary education shall be introduced by the end of 2021. A European Digital Education Content Framework will build on European cultural and creative diversity and include guiding principles for specific sectors of education and their needs. Erasmus cooperation projects shall support the digital transformation plans of primary, secondary, vocational education and training (VET), higher and adult-education institutions. Ethical guidelines on artificial intelligence (AI) and data usage in teaching and learning for educators shall be developed and related research and innovation activities through Horizon Europe supported.

A European approach to Artificial Intelligence

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Non-legislative Act: On the 19th of February 2020 the European Commission published a White Paper on Artificial Intelligence - A European approach to excellence and trust (press release).

Problem: While the rapid development of Artificial Intelligence (AI) will improve healthcare, increase the efficiency of farming, contribute to climate change mitigation and adaptation, promote the efficiency of production systems through predictive maintenance as well as strengthen the security of Europeans, there are a number of emerging potential risks. These include opaque decision-making, gender-based or other kinds of discrimination, intrusion in private lives or its usage for criminal purpose. In order to enable scientific breakthrough, preserve the EU’s technological leadership and ensure that new technologies are at the service of all Europeans, the Commission analyses the opportunities and challenges of AI in addition to encouraging a Union-wide approach that allows all member states to profit from the development and deployment of AI.

Objective: The White Paper primarily aims to provide a thorough evaluation of policy options on how to achieve a regulatory and investment oriented approach, with the twin objective of promoting the uptake of AI and of addressing the risks associated with certain uses of this new technology. In order to build safe, reliable and sophisticated products and services from aeronautics to energy, automotive and medical equipment in addition to becoming a global leader in innovation in the data economy and its applications, the EU needs to combine its technological and industrial strengths with a high-quality digital infrastructure and a regulatory framework based on its fundamental values. An AI ecosystem is to benefit European citizens, private businesses as well as the public interest. Improving health care, decreasing the number of breakdowns of household machinery, enabling safer and cleaner transport systems, and better public services shall benefit the citizens, while the development of a new generation of products and services in areas where Europe is particularly strong can promote business development. Lastly, services of public interest will profit from reduced costs of providing services, improved sustainability of products and equipped law enforcement authorities with appropriate tools to ensure the security of citizens.

Subject Matter: Investment in next generation technologies and infrastructures, as well as in digital competences like data literacy, shall increase Europe’s technological sovereignty in key enabling technologies and infrastructures for the data economy. Additionally, initiatives such as the European Processor Initiative, which focuses on developing low-power computing systems for both edge and next generation high-performance computing, and the work of the Key Digital Technology Joint Undertaking shall enhance the EU’s position in low-power electronics. Specific actions proposed by the Commission include the revision of the Coordinated Plan based on the analysis of the White Paper, the creation of excellence and testing centres that can combine European, national and private investments, possibly including a new legal instrument as well as the establishment and support through the advanced skills pillar of the Digital Europe Programme networks of leading universities and higher education institutes to attract the best professors and scientists and offer world-leading masters programmes in AI. The Commission will work with member states to ensure that at least one digital innovation hub per member state has a high degree of specialisation on AI. Lastly, it will, with the help of the European Investment Fund, launch a pilot scheme of €100 million in Q1 2020 to provide equity financing for innovative developments in AI.

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Non-legislative Act: On the 19th of February 2020 the European Commission published a Communication on a European strategy for data (press release).

Problem: New digital technologies have transformed the economy and society, affecting all sectors of activity and the daily lives of all Europeans, putting data and data protection in the spotlight of this transformation. While data-driven innovation has the potential to bring enormous benefits for citizens, citizens will embrace data-driven innovations only if they are confident that any personal data sharing in the EU will be subject to full compliance with the EU’s strict data protection rule. Therefore, a common European date space as well as the further development of a genuine single market for data require common action between member states.

Objective: Wanting to become a leading role model for a society empowered by data, the EU needs to strengthen its legal framework in terms of data protection, fundamental rights, safety and cyber-security. Improvement in the governance structures for handling data and the increase in pools of quality data available for use and re-use are vital. Europe aims to capture the benefits of better use of data, including greater productivity and competitive markets, but also improvements in health and well-being, environment, transparent governance and convenient public services. A comprehensive approach to the data economy shall increase the use of, and demand for, data and data-enabled products and services throughout the Single Market. Common European rules and efficient enforcement mechanisms shall ensure that data flows within the EU and across sectors. European rules and values, in particular personal data protection, consumer protection legislation and competition law, are to be fully respected. Lastly, the rules for access to and use of data shall be fair, practical, and clear, as well as promote trustworthy data governance mechanisms.

Subject Matter: A legislative framework for the governance of common European data spaces as well as an implementing act on high-value data-sets shall be proposed in 2020 and adopted in 2021 respectively. The analysis of the importance of data in the digital economy and the review of the existing policy framework in the context of the Digital Services Act package has also been planned. The EU shall invest in a High-Impact project on European data spaces, encompassing data sharing architectures and governance mechanisms. In addition to an EU (self-)regulatory cloud rulebook, a European cloud services marketplace will be launched in 2022. Lastly, a framework that can measure data flows and estimate their economic value within Europe, as well as between Europe and the rest of the world, is to be established.

Digital Services

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Legislative procedure completed: The European Parliament and EU Member States agreed on the Digital Services Act on 23 April 2022 (press release).
Six months after the entry into force, the Regulation will be directly applicable across the EU. Subjecting gatekeepers to obligations and prohibitions, the DMA shall allow an effective enforcement mechanism ensuring rapid compliance with precise obligations.

Proposal: On the 15th of December 2020 the European Commission published a Proposal for a Regulation on contestable and fair markets in the digital sector (Digital Markets Act) (press release).

Problem: Increasingly there are more large platforms that act as gateways or gatekeepers between business users and end users who enjoy an entrenched and durable position, often as a result of the creation of conglomerate ecosystems around their core platform services, which reinforces existing entry barriers. Having a major impact on as well as substantial control over the access to digital markets, many businesses become dependent on these gatekeepers, which leads, in certain cases, to unfair behaviour vis-à-vis these business users. Given that regulatory initiatives by member states cannot fully address these effects, action on EU level is crucial in order to prevent a fragmentation of the Internal Market.

Objective: The proposed Digital Markets Act aims to ensure that the conduct of large online platforms, acting as “gatekeepers” in digital markets, is guaranteed in a fair way, allowing the development of contestable and fair markets in the digital sector across the Union where gatekeepers are presented. Addressing gatekeeper’s unfair conduct in addition to enhancing the coherence and legal certainty shall help preserve the internal market. Interventions will allow the contestability of the digital sector, which in turn can have a significant positive and growing contribution in setting forward all of the potential benefits of a Digital Single Market, also resulting in lower prices and greater consumer choice, productivity gains and innovation. Efficiency gains from the Digital Single Market, will contribute to a 1.5 per cent increase in GDP per year until 2030 and create between 1 and 1.4 million jobs. Additionally, greater innovation potential amongst smaller businesses as well as improved quality of service shall increase consumer welfare. By establishing those aims, the regulation creates new opportunities for innovators and start-ups to compete in the online platform environment. As a result, consumers will have a wider variety of choices which providers to choose from and fairer prices. Nevertheless, the gatekeepers still have the opportunities to innovate, but in a fair way, without unfair practices towards the businesses and consumers.

Subject Matter: The communication between the Commission and the gatekeeper concerned may be required to ensure that measures considered or implemented by the gatekeepers better achieve its goals. By introducing the possibility for such a dialogue, the initiative can be expected to be more effective in addressing unfair practices hampering market contestability and competition. While the Regulation will be reviewed and evaluated every third year, the Commission shall continuously assess the effectiveness and efficiency of the measures. In particular, a review may be required when additional rules, including regarding enforcement, are determined necessary to ensure that digital markets across the EU are contestable and fair. Findings must be reported to the European Parliament, the Council and the European Economic and Social Committee.

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Legislative procedure completed: The European Parliament and EU member states agreed on the Digital Services Act on 23rd of April 2022 (press release).
Fifteen months or from 1 January 2024, whichever later, after entry into force, the DSA will be directly applicable across the EU. Very large online platforms and very large online search engines will be subject to the DSA four months after their designation. Providing better protection to EU’s citizens, the DSA sets out an unprecedented new standard for the accountability of online platforms regarding illegal and harmful content. It contains EU-wide due diligence obligations that will apply to all digital services that connect consumers to goods, services, or content, including new procedures for faster removal of illegal content as well as comprehensive protection for users' fundamental rights online.

Proposal: On the 15th of December 2020 the European Commission published a Proposal for a Regulation on a Single Market for Digital Services (Digital Services Act) and amending Directive 2000/31/EC (press release).

Problem: Ever since the e-Commerce Directive was adopted, new and innovative information society (digital) services have emerged, changing the daily lives of Union citizens and shaping and transforming how they communicate, connect, consume and do business. While a number of positive developments such as societal and economic transformations in the Union and across the world have been encouraged, new risks and challenges, both for society as a whole and individuals using such services, have become more apparent. Furthermore, with the emergence of the COVID-19 pandemic has highlighted the dependency of the economy and society on digital services as well as the risks stemming from the current framework for the functioning of digital services. Therefore, the Commission committed to update the horizontal rules that define the responsibilities and obligations of providers of digital services, and online platforms in particular, by reforming the existing EU e-commerce legal framework.

Objective: Appropriate supervision of digital services and cooperation between authorities at EU level is needed in order to ensure the proper functioning of the single market as well as establish trust, innovation and growth within. Thus, ensuring the best conditions for innovative cross-border digital services to develop in the EU across national territories and at the same time maintain a safe online environment for all EU citizens, goals which can only be served at European level. A strengthened European layer of supervision shall coordinate and complement national regulators. Additionally, to ensure the proper function of the internal market for intermediation services, innovation and competitiveness within the single market is to be fostered. Establishing an accountability framework for online platforms and setting out uniform rules for a safe online environment, where fundamental rights enshrined in the Charter are effectively protected, is further highlighted.

Subject Matter: This proposed Regulation contains clear rules on the provision of intermediary services, by establishing a framework for their responsibilities. This includes to address the risks faced by their users and to protect their rights, as well as rules on specific due diligence obligations. Another focus is on the enforcement of the regulation, including the cooperation between the competent authorities. For the cross-border application of the obligations under this Regulation, a consistency mechanism, a new advisory group coordinating the activities of national authorities and of the Commission as well as direct enforcement powers for the Commission and the set-up of an information system facilitating information flows between Digital Services Coordinators is needed. Furthermore, the proposed regulation comprehends additional obligations for very large online platforms to manage systemic risks. Within five years from the entry into force of the regulation, and then every five years thereafter, the Regulation will be reviewed periodically, including by the Commission, in order to evaluate the effectiveness and efficiency of the measures, in the context of the application of the measures.

Increasing Cybersecurity

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Proposal: On the 16th of December 2020 the European Commission published a Proposal for a Directive on measures for a high common level of cybersecurity across the Union, repealing Directive (EU) 2016/1148 (press release).

Problem: The evaluation of the NIS Directive identified specific weaknesses including the low level of cyber resilience of businesses operating in the EU, the inconsistent resilience across member states and sectors as well as the low level of joint situational awareness and lack of joint crisis response. Thus, particularly with regard to the COVID-19 pandemic that further amplified these issues, the modernization of the existing legal framework that takes account of the increased digitization of the internal market in recent years and the evolving cybersecurity threat landscape, is needed.

Objective: The goal of the Cyber Security Strategy is to create a secure defence capability against cyber threats through enhanced digital services and tools. Improving the resilience and capacity to respond to security incidents of public and private entities, competent authorities and the Union as a whole in the field of cyber security and protection of critical infrastructure is also suggested. Thus, the revision aims to increase the cyber resilience of a range of businesses operating in the European Union across all relevant sectors, to promote equally strong resilience among sectors already covered by the Directive in the internal market, and to enhance common situational awareness and collective preparedness and response capabilities. Further, it aims to increase the trust of citizens and businesses in services and ensure a global and open internet. The planned safeguards are therefore also intended to protect European values, and in particular fundamental rights.

Subject Matter: The EU is to act in three areas: Resilience, technological sovereignty and leadership; operational capabilities for prevention, deterrence, and response; and cooperation to promote a global and open cyberspace. This proposal aims to ensure that the delivery of services in the internal market can be guaranteed by strengthening the resilience of critical infrastructure operators in the Member States. This will be achieved in particular through a better understanding of the risks and means to address them.
The Commission will regularly review the functioning of the Directive and report to the European Parliament and the Council, the first time three years after the entry into force of the Directive. It will also assess the correct implementation of the Directive by Member States. The monitoring and reporting of the proposal will follow the principles set out in ENISA's standing mandate under REGULATION (EU) 2019/881 (Cybersecurity Act). The data sources used for the planned monitoring will mainly come from ENISA, the Cooperation Group, the CSIRT network and Member State authorities. In addition to the data obtained from the reports (including the annual activity reports) of ENISA, the Cooperation Group and the CSIRTs network, specific data collection tools could also be used if needed (e.g. surveys of national authorities, Eurobarometer, and reports on the Cybersecurity Month campaign and the Europe-wide exercises).

Digital for Consumers

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Legislative, including impact assessment, Article 114 TFEU, 3rd quarter 2020.

See 2021.

  A New Industrial Strategy for Europe

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Non-legislative Act: On the 10th of March 2020 the European Commission published a Communication on a new Industrial Strategy for Europe (press release).

Problem: The twin ecological and digital transitions are beginning to affect every part of Europe’s economy, society and industry, requiring new technologies, with investment and innovation to match, creating new products, services, markets and business models as well as shaping new types of jobs that do not yet exist. Accordingly, Europe’s industry must become the accelerator and enabler of change and innovation, affirming its voice, upholding its values and fighting for a level playing field in the industry.

Objective: Supporting competition within the EU as well as overseas, the EU shall continue its efforts to uphold, update and upgrade the world trading system. In particular, it shall adjust its industry in a more climate-neutral manner in line with the goal of becoming the world’s first climate-neutral continent by 2050. To become more competitive as it becomes greener and more circular, industry will need a secure supply of clean and affordable energy and raw materials. Enhancing its industrial capacity in critical digital infrastructure as well as modernising and decarbonising energy-intensive industries are a top priority. Building a more circular economy, skilling and reskilling along with investing and financing the transition are also subject of the Communication. Lastly, increasing links between different products and services across sectors is crucial in order to promote the integration of Europe’s industry, its diversity, traditions, and people across value chains and borders.

Subject Matter: Specific actions include the adaptation of the SME Strategy for a sustainable and digital Europe, the Single Market Enforcement Action Plan and the Single Market Barriers Report, the establishment of a Single Market Enforcement Task-Force. Additionally, a follow-up to the European Data Strategy to develop an EU data economy, including the launch of common European data spaces in specific sectors and value chains. An action plan on the Customs Union in 2020 to reinforce customs controls, including a legislative proposal for an EU Single Window to allow for fully digital clearance processes at the border and a White paper on an instrument on foreign subsidies by mid-2020 have also been announced. Updating the Skills Agenda for Europe in 2030, including a recommendation on Vocational Education and Training, launching a European Pact for Skills and a communication on a European Education Area Strategic Framework shall promote EU’s new industry strategy. The Commission shall strive to increase the political ownership of the strategy, suggesting a standing progress point at the Competitiveness Council and at the European Parliament, done on the basis of a regular monitoring of the strategy’s implementation and analysis of a set of key performance indicators.

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Non-legislative Act: On the 10th of March 2020 the European Commission published a Communication on identifying and addressing barriers to the Single Market (press release).

Problem: Although the European Single Market is the world’s largest single market, with more than 447 million consumers and up to 56 million jobs that depend on the trade, businesses, and consumers still report many hurdles, admitting that the single market was not sufficiently integrated. Therefore, taking into account the experiences and perceptions of businesses and consumers who try to use the single market on a daily basis, the Commission identifies key barriers to EU’s Single Market.

Objective: The five main root causes for the barriers that include regulatory choices at EU and national level, transposition, implementation, and enforcement of legislation, administrative capacity and practices in the member states, general business and consumer environment and root causes not linked to public policy such as language or culture. These shall to be adequately addressed in order to promote digitalisation of the public administration and better communication to help users’ along their journey, new and improved EU legislation where necessary, better implementation and ultimately enforcement. Thus, the single market shall be adapted to today’s challenges by the help of the Commission and its support to the member states.

Subject Matter: All single market, and e-government-relevant Multiannual Financial Framework proposals are to be adopted by the member states as well as the European Parliament in order to finance new standards, IT tools (such as the Internal Market Information system (IMI)), citizen and business services (such as SOLVIT) or awareness-raising campaigns. In particular, the Digital Europe programme and the Single Market programme. They shall further adopt pending legislative proposals which aim to tackle the root causes of the barriers identified in this Communication. Additionally, the Commission will assess the need for further regulatory action to address the barriers depending on other root causes which can be addressed at EU level, as well as report the results. Member states are advised to step up efforts to comply with single market legislation, abating existing barriers and avoiding the creation of new ones, fulfilling their legal duties and taking their responsibility to address the root causes that are within their remit such as burdensome regulation and procedures.

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Non-legislative Act: On the 10th of March 2020 the European Commission published a Communication on a long term action plan for better implementation and enforcement of single market rules (press release).

Problem: To make the single market work for all, common rules are necessary in order to eliminate barriers and facilitate the circulation of goods and services across the EU, while also protecting consumers. The existence of current barriers mainly derives from incorrect or incomplete application at national level of already agreed EU legislation. Therefore, the following action plan is to promote the uniform implementation of the single market laws.

Objective: The Commission primarily aims to encourage free movement rights of market operators and investors that still encounter many regulatory and administrative barriers as well as to protect Europeans that are exposed to illicit or dangerous products and services due to lack of practical surveillance, inspection, detection and sanctioning of economic operators by violations of the single market rules. Specific actions that are needed to include the establishment of a programme to provide more specific guidance tools for national authorities, improved access to information on rules and requirements for users, building capacity of public procurement professionals and strengthening the cooperation between national bodies, structured dialogue for better transposition of single market directives and lastly the constitution of the EU Product Compliance Network.

Subject Matter: While the Commission is to assist member states in transposing EU law correctly, fully and on time as well as check the transposition and monitor the application of EU law, member states are encouraged to transpose EU law timely and accurately, refraining from unjustified “gold plating”, and ensuring a level playing field, where national legislation is proportionate and non-discriminatory. Sufficient and proportionate administrative checks and controls shall identify any breaches. Therefore, member states are advised to implement routine checks in addition to avoiding national measures that could contradict or hamper the application of EU law. Respectively, the Commission shall act against breaches of EU Law and take formal infringement action if needed; thus, the cooperation and coordination between the member states and the Commission stays at the forefront of the Communication.

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Non-legislative Act: On the 10th of March 2020 the European Commission published a Communication regarding an SME Strategy for a sustainable and digital Europe (press release).

Problem: In the EU, small and medium enterprises (SMEs) employ around 100 million people, account for more than half of Europe’s GDP and play a key role in adding value in every sector of the economy by providing innovative solutions to challenges like climate change, resource efficiency and social cohesion. Therefore, any challenges to comply with rules and access information faced by European SMEs are challenges for the whole of Europe. With the following strategy the different needs of SMEs are to be identified, helping companies not just to grow and scale up, but also to be competitive, resilient, and sustainable.

Objective: The ultimate goal to make the EU the most attractive place to start a small business, make it grow and scale up in the single market is to be achieved through an ambitious, comprehensive and cross-cutting approach, based on horizontal measures with three specific pillars: Capacity-building and support for the transition to sustainability and digitalisation; reducing regulatory burden and improving market access; and improving access to financing. Unleashing the power of Europe's SMEs of all kinds to lead the twin transitions as well as promoting the increase in the number of SMEs engaging in sustainable business practices and the number of SMEs employing digital technologies is at the forefront of the strategy.

Subject Matter: Upgrading the Enterprise Europe Network including with dedicated Sustainability Advisors and other sustainability services alongside to developing Digital Crash Courses for SME employees to become proficient in areas such as AI, cybersecurity or blockchain, the Commission shall empower SMEs to utilize the benefits of the digital transition. Additionally, the Commission will launch a “digital volunteers” programme and update the Skills Agenda for Europe to allow young skilled people and experienced seniors to share their digital competence with traditional businesses. Further, measures include the implementation of the Single Digital Gateway in an SME-friendly way by the member states, as well as the launch of a Space Entrepreneurship Initiative called ‘CASSINI’ by the Commission. Furthermore, the Commission shall simplify the existing state aid rules on combinations of national funds with InvestEU and Horizon funds in order to allow SMEs to benefit from pooled resources, helping them with the twin transitions. Finally, as part of its ongoing review of state aid rules, the Commission will revise state aid rules for risk finance and the IPCEI communication, to provide additional support to SMEs, ensuring crowding-in of private investment while avoiding distortions of the level playing field.

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Non-legislative Act: On the 17th of June 2020 the European Commission published a White Paper on levelling the playing field as regards foreign subsidies (press release).

Problem: While EU State aid rules help to preserve a level playing field to companies in the internal market with regard to subsidies granted by EU Member States, there are no such rules for subsidies granted by third country authorities. This creates risks in terms of competitiveness and fair conditions of competition in the EU market.

Objective: Promoting a broad discussion with member states, other European institutions, all stakeholders, including industry, social partners, civil society organisations, researchers, the public in general and any other interested party on the best way to effectively address the challenges identified is the main objective of the White Paper presented by the Commission. The results of the consultation on the White Paper will prepare the ground for choosing the most appropriate way to address the distortions created by foreign subsidies, including appropriate proposals for legal instruments, allowing the EU to fully benefit from global trade and pursue a model of open strategic autonomy. In the light of the green and digital transitions based on competition, open markets, world-leading research and technologies and a strong single market, the EU shall be able to shape the new system of global economic governance and develop mutually beneficial bilateral relations, while protecting itself from unfair and abusive practices.

Subject Matter: Each of the distortive effects caused by foreign subsidies shall be addressed by so-called “Modules” (overall three Modules): Unfair practices in the Single market generally are discussed in the first, in acquisitions of EU companies in the second and during EU public procurement procedures in the third module. Module 1 is intended as a general instrument to address foreign subsidies that cause distortions in the internal market and are provided to a beneficiary that is established or, in some instances, active in the EU. While specific distortions caused by foreign subsidies facilitating the acquisition of EU targets are addressed in the second module with the aim to ensure that that foreign subsidies do not give an unfair advantage to their recipients when acquiring (stakes in) other undertakings. Considering that foreign subsidies can be harm the conduct of EU public procurement procedures, the White Paper proposes a mechanism where bidders shall from now on be mandated to notify the contracting authority of financial contributions received from non-EU countries.

Aviation Services Package

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Legislative, incl. impact assessment, Article 100(2) TFEU, Q4 2020).
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Legislative, incl. impact assessment, Article 100(2) TFEU, Q4 2020.

Towards a European Research Area

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Non-legislative Act: On the 30th of September 2020 the European Commission published a Communication on a new ERA for Research and Innovation (press release).

Problem: In 2000, as a means to address the fragmentation of the EU’s research and innovation system, the European Research Area was established. Although the EU is still a global leader in research and innovation, its performance has stagnated since 2012. In the context of global competition and volatile geopolitical interests in addition to the COVID-19 pandemic, new vulnerabilities have been detected. Therefore, mobilising research and technological capacities, specifically in less developed regions within the EU, will be instrumental in promoting EU’s ability to autonomously source and provide crucial raw materials, technologies, and services that are safe and secure for industry and people.

Objective: The European Research Area was initially created with the aim of building a common scientific and technological area for the EU and creating a single market for research and innovation fostering free movement of researchers, scientific knowledge and innovation, and encouraging a more competitive European industry. In the light of current challenges, the new R&I ERA shall boost Europe’s recovery after the COVID-19 pandemic as well as support its green and digital transitions by supporting innovation based competitiveness. Fostering technological sovereignty in key strategic areas in addition to identifying policies and measures to improve preparedness and enhance resilience in respect of clean technologies for the next decade are crucial. Through an optimal approach, Europe’s green and digital transformation is to be accelerated and Europe’s resilience and preparedness to face future crises is to be strengthened. Lastly, Europe’s competitive edge in the global race for knowledge shall be encouraged.

Subject Matter: Member states need to re-affirm the 3 per cent EU GDP R&D investment target and update it to reflect new EU priorities. The Commission, on the other hand, is to support member states in the coordination and prioritisation of national R&I funding and reforms, between countries and with the EU, through dialogue and a dedicated ERA Forum for Transition. R&I policies shall be reformed within the member states in order to facilitate the coordination and complementarity of national and EU programmes, and contribute to the deployment of the recovery package. The Commission proposes to institute a dedicated work stream in the ERA Forum for Transition to promote and monitor access to excellence of researchers and institutions from Widening Countries. In cooperation with the member states and stakeholders, the Commission shall enforce the implementation of the New Industrial Strategy by jointly developing common industrial technology roadmaps by the end of 2022. Lastly, the Commission will built on the lessons learned from the Horizon Europe Strategic Planning process, develop with Member States an approach to set and implement strategic priorities that deliver on the ERA agenda.

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Non-legislative Act: On the 29th of September 2021 the European Commission published a Communication on European Missions (press release).

Problem: Climate and health crisis call for a new way of working across policy areas, fields of expertise and science, directly engaging with companies, local communities and the innovation community. So-called EU Missions will promote societal actors to join forces in new and innovative ways, conducting research and innovation in policy areas that have brought health and socio-economic challenges in the past several years.

Objective: The overall aim of EU Missions is to address societal challenges and reconnect citizens with the European Union by inspiring and empowering them to improve their lives and those of others. By supporting at least 150 European regions and communities to become climate resilient as well as restoring the oceans and waters by 2030, EU shall adapt to climate change. Through prevention and cure, the lives of more than 3 million people affected by cancer and their families shall be improved. 100 Climate-Neutral and Smart Cities in addition to 100 living labs and lighthouses are to be developed by 2030. Research and innovation based on each mission’s concrete targets will set the direction to achieve results. Basic and applied research, actors sectors and domains can demonstrate, scale up and replicate existing and new solutions including social innovations. By allowing tailor-made innovation approach including social innovation, solutions shall be fully adapted to fit local circumstances.

Subject Matter: Through panels, the Adaptation to Climate Change mission will support participating regions in consulting and directly involving citizens. In the Climate- Neutral and Smart Cities mission, the selected cities will involve their citizens in drawing up the objectives of “Climate City Contracts” to help reach climate neutrality by 2030. The active involvement of citizens’ locally organised approaches will continue during the implementation, building ownership and legitimacy of the actions that the local authorities launch. Young people are invited to help protect the planet through a planned Climate initiative under the European Solidarity Corps. Therefore, the Commission will mobilise the appropriate instruments and resources in pursuit of the missions’ objectives, i.a. taking 1.89 billion from the Horizon Europe programme for the period 2021-23. The implementation of EU’s five Missions are to be assessed by the Commission no later than 2023. Cooperation with member states, local authorities, researchers, innovators, the private sector, citizens, civil society and investors in addition to the input of the European Parliament will be crucial.

Digital Finance

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Non-legislative Act: On the 24th of September 2020 the European Commission published a Communication on a Digital Finance Strategy for the EU (press release).

Problem: Consumers and businesses are increasingly more prone to access financial services digitally, while innovative market participants are deploying new technologies, and existing business models are shifting towards digital finance. Particularly with regard to the COVID-19-pandemic, a growing proportion of in-store payments are now digital and contactless, and on-line purchases (e-commerce) have significantly increased. Therefore, as more people access financial services online and financial sector employees themselves work remotely, ensuring safe and reliable operation of digital infrastructures has also become more important.

Objective: Supporting EU’s digital transition as well as innovative projects across member states will contribute to the overall digital transformation of its economy and society and additionally bring significant benefits to both consumers and businesses. It is the objective to make the benefits of digital finance available to European consumers and businesses, along with promoting digital finance based on European values and a sound regulation of risks. The Commission prioritises the tackling of the fragmentation in the Digital Single Market for financial services so that European consumers can obtain a better access to cross-border services and European financial firms’ can scale up their digital operations. The EU regulatory framework shall facilitate digital innovation in the interest of consumers and market efficiency. Furthermore, creating a European financial data space can help promote data-driven innovation, while building on the European data strategy can facilitate access to data and data sharing within the financial sector. Lastly, the EU plans to adequately address new challenges and risks associated with the digital transformation.

Subject Matter: Specific measures include a proposal by the Commission as part of a broader initiative on AML/CFT addressing member state to harmonise rules on customer onboarding and to implement an interoperable cross-border framework for digital identities. Additional harmonised licensing and passporting regimes, cooperation with the ESAs to strengthen EFIF, and establishing an EU digital finance platform to foster cooperation between private and public stakeholders will further be explored. A new legislative framework for crypto-assets, including asset-referenced tokens and utility tokens, will help the Commission ensure that potential material regulatory obstacles to innovation stemming from legislation on financial services are removed. It will regularly provide interpretative guidance on how existing legislation on financial services is to be applied to new technologies. Moreover, a new strategy on supervisory data that shall be proposed in 2021 and a legislative proposal for a new open finance framework by mid-2022, building on and in full alignment with broader data access initiative have been announced. Finally, the Commission will propose by mid-2022 the necessary adaptations to the existing financial services legislative framework with respect to consumer protection and prudential rules, in order to protect end-users of digital finance, safeguard financial stability, protect the integrity of the EU financial sector and ensure a level playing field.

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Non-legislative Act: On the 24th of September 2020 the European Commission published a Communication on a Retail Payments Strategy for the EU (press release).

Problem: The continuous increase in cashless transactions, specifically reinforced by the COVID-19 pandemic, has shown the vital importance of safe, accessible and convenient (including contactless) payments for remote and face-to-face transactions. Considering that the EU payments market remains, to a significant degree, fragmented along national borders, as most domestic payment solutions based on cards or instant payments do not work cross-border, the Commission identifies the need for a clear ‘governance’ framework, one that develops a clear vision, setting out the expected direction of travel and placing future actions under a single, coherent and overarching policy framework.

Objective: The new retail payment strategy aspires to allow citizens and businesses in Europe to benefit from a broad and diverse range of high-quality payment solutions, supported by a competitive and innovative payments market and based on safe, efficient and accessible infrastructures. Competitive home-grown and pan–European payment solutions shall be available in order to effectively support Europe’s economic and financial sovereignty, while improving cross-border payments with non-EU jurisdictions, including remittances is to promote the international role of the euro and the EU’s ‘open strategic autonomy’. The overall objective is to generate a highly competitive payments market, benefitting all member states, whichever currency they use, where all market participants are able to compete on fair and equal terms to offer innovative and state-of-the-art payment solutions in full respect of the EU’s international commitments.

Subject Matter: The Commission will assess whether it would be appropriate to require adherence by relevant stakeholders to all, or a subset of, the additional functionalities of SEPA Instant Credit Transfer (SCT Inst.), which could also include any future standards for QR-codes. In cooperation with the European Central Bank and/or the European Banking Authority (EBA), it will also examine whether specific measures should be taken to enhance the effectiveness of the crisis management of payment systems, and to ensure sound mitigation measures on the liquidity risk for financial institutions resulting from the rapid, low-friction outflow of funds via instant payments. By 2023, the feasibility of developing a ‘label’ for eligible pan-European payment solutions in addition to the facilitation of the deployment of European specifications for contactless card-based payments (CPACE) will be explored. Moreover, the Commission will continue to provide guidance, if required, to ensure that instant payments solutions and their respective business models comply with EU competition rule.

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Legislative process completed: On July 1, 2022, the European Parliament and the Council reached a political agreement on the Regulation on markets for crypto assets and on amending the Regulation on transfers of funds (press release). The regulation will protect consumers, market integrity and financial stability, as well as create a new legal framework that will enable further innovation on a safe and sound basis.

Proposal: On the 24th of September 2020 the European Commission published a Proposal for a Regulation on Markets in Crypto-assets, and amending Directive (EU) 2019/1937 (press release).

Problem: In order to ensure that the EU is fit for the digital age and to build a future-ready economy that works for the people by enabling and supporting the potential of digital finance in terms of innovation and competition while mitigating the risks, the Commission undertakes one of the major applications of blockchain technology in finance, crypto-assets. Considering that as of right now most crypto-assets fall outside the scope of EU financial services legislation and therefore are not subject to provisions on consumer and investor protection and market integrity, a common approach adopted by all member states is crucial to make the most of the opportunities they create and address the new risks they may pose.

Objective: The Commission includes four main objectives that go as follows: providing legal clarity and certainty to promote the safe development of crypto-assets and use of DLT in financial services; supporting innovation and fair competition by creating an enabling framework for the issuance and provision of services related to crypto-assets; ensuring a high level of consumer and investor protection and market integrity, and lastly addressing potential financial stability and monetary policy risks that could arise from an increased use of crypto-assets and DLT. It is further highlighted the need to remove regulatory obstacles to the issuance, trading and post-trading of crypto-assets that qualify as financial instruments, while respecting the principle of technological neutrality. Additionally, the sources of funding for companies shall be expanded through increased Initial Coin Offerings and Securities Token Offerings. Limiting the risks of fraud and illicit practices in the crypto-asset markets as well as allowing EU consumers and investors to access new investment opportunities or new types of payment instruments in particular for cross-border situations are also on the agenda.

Subject Matter: For the insurance and admission to trading of crypto-assets transparency and disclosure requirements as well as the authorisation and supervision of crypto-asset service providers and issuers of asset-referenced tokens and issuers of electronic money tokens are settled. The Proposal presents uniform rules regarding the operation, organisation and governance of issuers of asset-referenced tokens, issuers of electronic money tokens and crypto-asset service providers in addition to consumer protection rules for the issuance, trading, exchange and custody of crypto-assets. Lastly, measures to prevent market abuse to ensure the integrity of crypto-asset markets are provided. The Commission shall establish a detailed programme for monitoring the outputs and impacts of this initiative, as well as monitor the effects of the new requirements.

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Proposal: On the 24th of September 2020 the European Commission published a Proposal for a Regulation on digital operational resilience for the financial sector and amending Regulations (EC) No 1060/2009, (EU) No 648/2012, (EU) No 600/2014 and (EU) No 909/2014 (press release).

Problem: Given that Digital, or Information and Communication Technologies (ICT), give rise to opportunities as well as risks, there is a need to understand as well as adequately manage them, especially in times of stress. While there have been national regulatory initiatives (e.g. on digital operational resilience testing) and supervisory approaches (e.g. addressing ICT third-party dependencies), due to the absence of detailed and comprehensive rules on digital operational resilience at EU level, given cross-border nature of ICT risks, effects have stayed limited. Moreover, the uncoordinated national initiatives have resulted in overlaps, inconsistencies, duplicative requirements, high administrative and compliance costs - especially for cross-border financial entities - or in ICT risks remaining undetected and hence unaddressed.

Objective: A detailed and comprehensive framework on digital operational resilience for EU financial entities shall deepen the digital risk management dimension of the Single Rulebook. It can particularly enhance and streamline the financial entities’ conduct of ICT risk management, establish a thorough testing of ICT systems, increase supervisors’ awareness of cyber risks and ICT-related incidents faced by financial entities, as well as introduce powers for financial supervisors to oversee risks stemming from financial entities’ dependency on ICT third-party service providers. The proposal will create a consistent incident reporting mechanism that will help reduce administrative burdens for financial entities, and strengthen supervisory effectiveness.

Subject Matter: Uniform requirements concerning the security of network and information systems supporting the business processes of financial entities needed to achieve a high common level of digital operational resilience include requirements applicable to financial entities in relation to Information and Communication Technology (ICT) risk management, reporting of major ICT-related incidents to the competent authorities, digital operational resilience testing, information and intelligence sharing in relation to cyber threats and vulnerabilities, and lastly measures for a sound management by financial entities of the ICT third-party risk. Further requirements in relation to the contractual arrangements concluded between ICT third-party service providers and financial entities, the oversight framework for critical ICT third-party service providers when providing services to financial entities in addition to rules on cooperation among competent authorities and rules on supervision and enforcement by competent authorities are also presented.

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Proposal: On the 24th of September 2020, the European Commission published a Proposal for a Regulation on a pilot regime for market infrastructures based on distributed ledger technology (press release).

Problem: Allowing the European Union to be fit for the digital age and to build a future-ready economy that works for the people, the Commission introduced a Digital Finance Package which shall further enable and support the potential of digital finance in terms of innovation and competition while mitigating the risks. The following Proposal shall specifically target distributed ledger technology (‘DLT’), enabling innovative firms to adequately make use of them.

Objective: As the first concrete action in its area, this Proposal seeks to provide appropriate levels of consumer and investor protection, legal certainty for crypto-assets and financial stability for firms applying new technologies. The creation of an EU framework that both enables markets in crypto-assets and the tokenisation of traditional financial assets and wider use of DLT in financial services is accompanied by four main objectives: providing legal clarity and certainty to know exactly where the framework is no longer fit for purpose; supporting innovation and fair competition by creating an enabling framework to ensure that more wide-ranging changes to existing financial services legislation are evidence-based; instilling consumer and investor protection and market integrity; and lastly ensuring financial stability. The pilot regime will put in place appropriate safeguards, for example limiting the types of financial instruments that can be traded. Moreover, provisions specifically aimed at ensuring financial stability and consumer and investor protection will not be within the scope of the provisions that a DLT market infrastructure could be exempted from.

Subject Matter: This Regulation lays down requirements on multilateral trading facilities and securities settlement systems using distributed ledger technology ‘DLT market infrastructures’. Such requirements are set for granting and withdrawing specific permissions; granting, modifying and withdrawing related exemptions; as well as mandating, modifying and withdrawing attached conditions, compensatory or corrective measures. Moreover, the operators of DLT market infrastructures shall cooperate with the competent authorities which are entrusted with granting specific permissions under this Regulation and with ESMA. Additionally regarding any proposed material change to their business plan including critical staff, the rules of the DLT market infrastructure and associated legal arrangements at least four months before the change is planned as well as any evidence of unauthorised access, material malfunctioning, loss, cyber-attacks or other cyber-threats, fraud, theft or other serious malpractice suffered by the DLT market infrastructure shall be notified to said competent authorities and ESMA.

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Proposal: On the 24th of September 2020 the European Commission published a Proposal for a Directive amending Directives 2006/43/EC, 2009/65/EC, 2009/138/EU, 2011/61/EU, EU/2013/36, 2014/65/EU, (EU) 2015/2366 and EU/2016/2341 (press release).

Problem: In order to provide legal certainty as regards crypto assets and achieve the objectives of strengthening digital operational resilience in line with the new Digital Finance Package, it is necessary to establish a temporary exemption for multilateral trading facilities and amend or clarify certain provisions in existing EU financial services directives.

Objective: The objectives of the following Directive are identical to the ones indicated in the Proposal for a Regulation on Markets in Crypto-assets, as well as the Proposal for a Regulation on a pilot regime for market infrastructures based on distributed ledger technology. Accordingly, the Commission endorses four key targets listed hitherto: providing legal clarity and certainty to promote the safe development of crypto-assets and use of DLT in financial services; supporting innovation and fair competition by creating an enabling framework for the issuance and provision of services related to crypto-assets; ensuring a high level of consumer and investor protection and market integrity, and lastly addressing potential financial stability and monetary policy risks that could arise from an increased use of crypto-assets and DLT. It is further highlighted the need to remove regulatory obstacles to the issuance, trading and post-trading of crypto-assets that qualify as financial instruments, while respecting the principle of technological neutrality. Additionally, the sources of funding for companies shall be expanded through increased Initial Coin Offerings and Securities Token Offerings. Limiting the risks of fraud and illicit practices in the crypto-asset markets as well as allowing EU consumers and investors to access new investment opportunities or new types of payment instruments in particular for cross-border situations are also on the agenda.

Subject Matter: Member states shall adopt and publish, by one year after adoption at the latest, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall forthwith communicate to the Commission the text of those provisions, as well as apply those provisions. When adopting those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Lastly, member states shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

ZEI Related Publications

Industry 4.0: SMEs Challenges and Opportunities in the Era of Digitalization,

Chiara Ristuccia

ZEI Discussion Paper C 252 / 2019

Die vierte industrielle Revolution ändert unser Leben tiefgreifend. Industrie 4.0 bietet der Wirtschaft in gleichem Maße Chancen und Herausforderungen, insbesondere für kleine und mittelständische Betriebe. Internet-Bedrohungen häufen sich, sodass auch kleine und mittlere Betriebe effiziente Lösung zur Cybersicherheit und zum Schutz ihrer Daten benötigen. Investitionen in neue Technologien müssen ebenso getätigt werden wie die Verbreitung digitaler Kompetenzen. Die Staaten der europäischen Union haben gezielte Initiativen gefördert, dabei aber aber unterschiedliche Stufen der Digitalisierung erreicht. Diese Publikation analysiert die primären Herausforderungen, denen Unternehmen sich stellen müssen, um mit den neusten Technologien Schritt zu halten und beleuchtet den aktuellen Stand der Reformen zur digitalen Transformation. Das Paper macht deutlich, dass die Europäische Union eine Vorreiterrolle bei der Unterstützung von Unternehmen und Bürgern spielen kann, um so den neuen Herausforderungen zu begegnen.

Priority 2: European Digital Single Market or the Collective Failure of Individuals,

Dominique Roch

In: Stüwe, Robert / Panayotopoulos, Thomas (Hrsg.): The Juncker Commission. Politicizing EU Policies (Schriftenreihe des Zentrum für Europäische Integrationsforschung, Bd. 79), Nomos: Baden-Baden 2020, S. 91-107, ISBN 978-3-8487-5597-4.

Das primäre Erkenntnisinteresse des Buches besteht darin, Strategien der Europäischen Kommission beim Umgang mit dem Phänomen der Politisierung  in der EU‐Gesetzgebung zu erforschen. In einer Fallstudie zur Amtszeit von Präsident Jean‐Claude Juncker analysieren die Autoren des Sammelbandes, wie die EU‐Kommission zwischen 2014 und 2019 bestimmte politische Schwerpunkte gesetzt hat, um ihre Agenda voranzutreiben. Gegenstand der Analyse sind die zehn politischen Prioritäten der Juncker‐Kommission aus den jährlichen Arbeitsprogrammen seit 2014. Ausgangspunkt der Studie ist das von Juncker proklamierte Selbstverständnis als „politischer Kommission“. Die Bewertung der „Politisierung“ integrationspolitischer Vorhaben fällt dabei ambivalent aus: Auf der einen Seite hat die Juncker Kommission politisierte Themen gezielt aufgegriffen und als Gelegenheiten zur politischen Führung  sowie zur Schärfung des eigenen institutionellen Profils genutzt. Auf der anderen Seite sah sich die EU‐Kommission zuweilen gezwungen, bei Krisen und  Kontroversen Schadensbegrenzung zu betreiben.

A Europe Fit for the Digital Age

Carlos Deniz Cesarano,

In: Robert Stüwe / Sally Bramers (eds.): ZEI Future of Europe Observer. Von der Leyen:Still caught in Corona Calamities, Jg. 9 Nr. 1 April 2021, S. 4-5.

Diese Ausgabe des ZEI Future of Europe Observer befasst sich mit der Umsetzung des ersten Arbeitsprogramms der von der
Leyen-Kommission im Rahmen des ZEI-Forschungsprojekts "Regieren und Regulieren in der Europäischen Union". Ergänzt durch Visualisierungen der bewährten ZEI Monitor-Ampel, bietet das Magazin Analysen zum Arbeitsfortschritt in den sechs politischen Prioritäten der Europäischen Kommission.

Chancen und Grenzen europäischer Cybersicherheitspolitik

Johannes Wiggen

ZEI Discussion Paper C 261/2020

Wie hat die EU bislang versucht, sich und ihre Mitgliedsstaaten vor staatlichen „Cyberattacken“ zu schützen bzw. diese zu vermeiden? Dieses Papier überträgt das Cybersicherheitsdilemma, das als einziges politikwissenschaftliches Konzept die Logik und Dynamik hinter Netzwerkoperationen erklärt, auf den Sicherheitsakteur EU, um die bislang von der EU unternommenen Politiken zu rekonstruieren sowie deren Effektivität zu bewerten. Das Papier argumentiert, dass sich die Cyber-Diplomatie der EU verstärkt auf den Aufbau von Vertrauen mit nicht-gleichgesinnten Staaten und die Etablierung eines zwischenstaatlichen Status quo im Umgang mit Cyberoperationen konzentrieren sollte. Zur Signalisierung ihrer friedvollen Absichten und um so einen unilateralen Beitrag zur Cybersicherheit aller Staaten zu leisten, sollte die EU einen Schwachstellenmanagementprozess verabschieden sowie sich pro-Verschlüsselung positionieren. Des Weiteren sollten die EU-28 Cybersicherheit defensiv denken, um das Cybersicherheitsdilemma nicht weiter zu befeuern, und deutlich machen, dass nur Cyberoperationen, die vergleichbar eines Militärschlages sind, mit militärischer Gewalt beantwortet werden.

Archive

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