ZEI Monitor: EU Progress 2019-2024

Cyber resilience

European cyber resilience act (legislative, incl. impact assessment, Q3 2022)

Semi-conductors

European chips act (legislative or non-legislative, Q2 2022)

Security and defence

Roadmap on security and defence technologies (non-legislative, Q1 2022)

Innovative and sustainable space

a) Building an EU space-based global secure communication system (legislative, incl. impact assessment, Article 189 TFEU, Q2 2022)

b) EU strategy for space traffic management (non-legislative, Q2 2022)

Digital in education and skills

a) Recommendation on improving the provision of digital skills in education and training (non-legislative, Q3 2022)

b) Recommendation on the enabling factors for digital education (non-legislative, Q3 2022)

Single market

Single market emergency instrument (legislative, incl. impact assessment, Q1 2022)

Multimodal digital mobility

Multimodal digital mobility services (legislative, incl. impact assessment, Article 91 TFEU, Q4 2022)

Europe’s digital decade

• Europe’s digital decade: 2030 digital targets(non-legislative, Q1 2021):
  

On the 9th of March 2021, the European Commission published a Communication regarding the European Digital Decade (Press release)

Goals: With the "Digital Compass 2030", the Commission formulates four concrete objectives to achieve its digitization efforts:

1. A digitally skilled population with highly skilled digital professionals: In addition to the basic digital skills target set out in the European Pillar of Social Rights Action Plan, further develop the digital education system.

2. Secure and performant sustainable digital infrastructures

a) All European households shall be equipped with a gigabit network and all populated areas shall equipped with 5G networks  

b) To drive the production of advanced and sustainable semiconductors in Europe, including processors

c) 10,000 carbon-neutral, high-security edge nodes shall be deployed across the EU by 2030, distributed to ensure low-latency (a few milliseconds) access to data services wherever businesses are located.

d) 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.

3. Digital transformation of businesses: 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

4. Digitization of public services
a) By 2030, EU citizens should be able to view an electronic version of their medical records
b) Enable online provision of key public services to European citizens and businesses by 2030.
c) 80 per cent of EU citizens shall use a digital ID solution by 2030.

Implementation: 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

Timeframe: The European Commission aims to present concrete objectives with its proposal for a digital policy program by the third quarter of 2021 and hopes to make decisive progress with the other institutions on a statement of digital principles by the end of 2021

Data package

• a) Data Act (legislative, incl. impact assessment, Article 114 TFEU, Q3 2021) b)Review of the Database Directive (legislative, incl. impact assessment, Article 114 TFEU, Q3 2021)

Digital levy

• Digital levy and a proposal for digital levy as own resource (legislative, incl. impact assessment, Q2 2021)

A trusted and secure European e-ID

• Proposal for a Regulation on a trusted and secure European e-ID (legislative, incl. impact assessment, Article 114 TFEU, 3rd of June 2021, press release)

Aim: On the 3rd of June 2021, the European Commission proposed a Regulation to form a framework for a European digital identity wallet. It shall enable EU citizens to use personal identification data to identify themselves in online and offline services across Europe. In addition, it should 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 even 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.

Legislative requirements: 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.

Implementation: 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 should 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.

Funding: 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

• Improving the working conditions of platform workers (legislative, incl. impact assessment, Article 153 TFEU, Q1/Q4 2021)

Industrial strategy for Europe

• Updating the New Industrial Strategy for Europe: Building a stronger Single Market for Europe's recovery (non-legislative, 5th of May 2021, press release)

On the 5th of May 2021, the European Commission published a Communication updating the 2020 Industrial Strategy. The 2020 Industrial Strategy was published in March 2020. One day before the WHO declared a global pandemic. Due to the changed economic and social situation, the strategy has now been revised and adapted to the current situation.

The Commission pursues the following objectives:

1. Strengthen the resilience of the common internal market.
This includes an internal market emergency instrument for a better and faster response in times of crisis, as well as the strengthening of internal market governance instruments & procedures and more transparency and coordination in EU internal export and service restrictions. In addition, 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, an improved market surveillance procedure and stronger cooperation in public procurement.

2. Dealing with the EU's strategic dependencies

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 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).

3. Accelerating the twin transition

To co-create transformation pathways, these 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).

Foreign subsidies

• Follow-up to the White Paper on foreign subsidies:

• a) Proposal for a Regulation on foreign subsidies distorting the Internal Market (legislative, incl. impact assessment, Article 207 TFEU, 5th of May 2021, press release)

Objective: The European Commission aims to eliminate distortions in the single market caused by subsidies from third countries. Therefore, on the 5th of May 2021, the Commission proposed a Regulation, which includes multiple counter measures and new rules concerning companies that carry out an economic activity in the internal market.

What is considered as a foreign subsidy? Foreign subsidies can take the form of capital injections, grants, loans, loan guarantees, tax incentives, compensation for operating loss, compensation for financial burdens imposed by public administration, debt forgiveness, conversion of debt into equity, or debt restructuring. In addition, the waiver of due revenues or the provision as well as the purchase of goods and services can also be considered a subsidy. The financial aid must be approved by the state from third countries.

What constitutes a market distortion?

A distortion of the internal market occurs as soon as the competitive position of the company concerned is improved with the help of the foreign subsidies. This occurs in most cases when the subsidies or unlimited guarantees are approved despite the poor economic situation of the company or when subsidies facilitate mergers as well as in the case of foreign subsidies inducing companies to submit unreasonably favorable bids.

Implementation: Since the Commission is supposed to conduct a review procedure ex officio, the Commission is allowed to request necessary information on its own initiative (ex ante approach) and thus conduct a preliminary examination. If there is sufficient evidence of distortion of the internal market within 90 days, the Commission adopts 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 shall 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.

Funding: The total administrative expenditure for the implementation of the proposal over the period 2021-2027 is EUR 90.340 million euro, part of which will be funded by the Single Market Program. 

• b) Proposal to be published: Public procurement (legislative, incl. impact assessment, Article 207 TFEU, Q2 2021)

Civil, defence and space industries

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.

Goal: 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

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.
 

Europe fit for the digital age

• European Data Strategy: On the 19th of February 2020, the European Commission presented a European Data Strategy which proposes to put in place an enabling legislative framework for the governance of common European data spaces in fourth quarter of 2020. Furthermore in 2021 a possible European Data Act could foster business-to-government data sharing for the public interest and support business-to-business data sharing, in particular addressing issues related to usage rights for co-generated data (such as IoT data in industrial settings), typically laid down in private contracts.

• Digital Strategy: On the 19th of February 2020, the European Commission put forward a Communication on Shaping Europe's digital future, announcing the following key actions:

1. White Paper on Artificial Intelligence setting 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 (Q4 2020).

2. Building and deploying cutting-edge joint digital capacities in the areas of AI, cyber, super-and quantum computing, quantum communication and blockchain. European Strategies on Quantum and blockchain (Q2 2020) as well as a revised EuroHPC Regulation on supercomputing.

3. Accelerating investments in Europe’s Gigabit connectivity, through a revision of the Broadband Cost Reduction Directive, an updated Action Plan on 5G and 6G, a new Radio Spectrum Policy Programme (2021).5G corridors for connected and automated mobility, including railway corridors, will be rolled out (2021-2030) (2021-2023).

4. A European cybersecurity strategy, including the establishment of a joint Cybersecurity Unit, a Review of the Security of Network and Information Systems (NIS) Directive and giving a push to the single market for cybersecurity.

5. A Digital Education Action Plan to boost digital literacy and competences at all levels of education (Q22020).

6. A reinforced Skills Agenda to strengthen digital skills throughout society and a reinforced Youth Guarantee to put a strong focus on digital skills in early career transitions (Q2 2020).

A European approach to Artificial Intelligence

• Postponed to the Q1 2021: Follow-up measures to the White Paper on Artificial Intelligence, including on safety, liability, fundamental rights and data (legislative, incl. impact assessment, Article 114 TFEU, originally scheduled for the Q4 2020)

• White Paper on Artificial Intelligence: On the 19th of February 2020, the European Commission published its White Paper on "Artificial Intelligence- A European approach to excellence and trust" and the accompanying Report on the safety and liability framework. The stated goal of the Commission is to launch a broad consultation of member states, civil society, industry and academics on concrete proposals for a European approach to AI. On the one hand, these include policy means to boost investments in research and innovation, enhance the development of skills and support the uptake of AIby SMEs, and on the other hand proposals for key elements of a future regulatory framework.

Digital services

• Digital Service Act and Digital Markets Act - Legislative Proposals: On the 15th of December 2020, the European Commission proposed two Regulations, as a part of the European Digital Strategy: The Digital Services Act and the Digital Markets Act. The acts mainly address obligations for platforms, transparency for users and fair competition in the digital single market. They modernize the current legal framework for digital services and thus replace the eCommerce Directive from the year 2000. (Press release)
  
  Digital Services Act:
  
  The main aims of the proposed Digital Services Act are:
  1.    to ensure the proper function of the internal market for intermediation services, by foster innovation and competitiveness within the single market and by establishing an accountability framework for online platforms and
  2.    to set out uniform rules for a safe online environment, where fundamental rights enshrined in the Charter are effectively protected.
  
  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.
  Furthermore, the proposed regulation comprehends additional obligations for very large online platforms to manage systemic risks. This initiative should mainly ensure that the single market remains competitive. (FAQ)
  
  Digital Markets Act:
  The main aims of the proposed Digital Markets Act are:
  1.    to ensure that the conduct of large online platforms, acting as “gatekeepers” in digital markets, is guaranteed in a fair way online and thus
  2.    to establish contestable and fair markets in the digital sector across the Union where gatekeepers are presented.
  A "gatekeeper" is a provider of core platform services that has a significant impact on the internal market, a strong intermediary position, and an entrenched and enduring position in its operations.
  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.(FAQ)
   
• Digital Services Act - Resolution / own-initiative reports of the European Parliament:

European Parliament resolution of the 20th of October 2020 on the European Commission's planned legislative proposal on digital services and on issues relating to fundamental rights, together with a series of own-initiative reports:

1. Report (JURI) of the 5th October 2020 with recommendations to the EU Commission on the Digital Services Act: Adaptation of commercial and civil law rules for companies operating online: a) updating EU rules on "notice and action" procedures to protect users' rights, b) stricter conditions for targeted advertising, c) less power for algorithms; d) Existing or new EU body for monitoring and imposing fines;

2. Report (IMCO) of the 7th of October 2020 with recommendations to the Commission on the Digital Services Act: Improving the functioning of the Single Market: a) Creating new rules to define the responsibilities of digital service providers, address risks for users and promote innovative services across the EU; b) A clear and binding mechanism to fight illegal online content; making the internet safer for consumers; c) Specific rules for large platforms to facilitate market entry for start-ups

3. Draft report (LIBE) on the Digital Services Act and fundamental rights issues of 27th of April 2020: a) Updating EU rules on "Notice and Action" procedures to protect users' rights; b) Stricter conditions for targeted advertising; c) Less power for algorithms; d) Existing or new EU body to monitor and impose fines

• High Performance Computing: On the 18th of September 2020, the European Commission presented a Proposal for a Regulation on establishing the European High Performance Computing Joint Undertaking (JU EuroHPC). The proposed regulation aims to set new financial envelopes of 8 billion euro until 2033 for the EuroHPC Joint Undertaking, by pooling European, national and private investments. This aims to maintain and further expand Europe's leading role in the fields of high-performance computing and quantum information technology. (Press release)
  

With the help of the new budget, the EuroHPC JU is to perform important tasks:

(1) Building and using a world-class high-performance computing and data infrastructure in the EU (the aim is to have 3 of the 5 best supercomputers in the world)
(2) Capacities for high-performance computing and quantum computing should be made available to all users throughout Europe (training on the required skills should be offered)
(3) The high-performance computing capacities are to be increased in order to give the digital strategy a dynamic dimension in all areas (in particular mass data analysis, artificial intelligence, cloud technology and cyber security)
(4) Providing secure cloud-based services for the European Public Data Space (as outlined in the European Data Strategy 2020)
(5) Development and establishment of an infrastructure for quantum informatics to solve complex problems

Increasing cybersecurity

EU-Cybersecurity Strategy: On the 16th of December 2020, the European Commission, together with the EU High Representative for Foreign Affairs and Security Policy Josep Borrell, presented a the European Cybersecurity Strategy for a Digital Decade. (Press release)  

In this context, to improve digital and physical resilience, the Commission has proposed two directives:

1. The proposed Directive COM/2020/823 (NSI 2) repeals the 2016 network and information systems security Directive and standardizes measures for a high common level of cybersecurity in the Union

2. The proposed Directive COM/2020/829 addresses the resilience of critical entities

The goal of the cybersecurity strategy is to create a secure defense capability against cyber threats through strengthened digital services and tools due to the increasing social and economic digital transformation. It also aims to strengthen the trust of citizens and businesses in services while ensuring a global and open Internet. The planned safeguards are therefore also intended to safeguard European values and fundamental rights in particular.

The EU will take action in three areas:
1. Resilience, technological sovereignty and leadership
2. Operational capabilities to prevent, deter and respond
3. Cooperation to advance a global and open cyberspace

NSI 2 Directive Proposal:

This proposal on the new NSI 2 directive intends to adapt the existing NIS directive to current needs and thus to future proof it. In terms of content, the scope of application of supervisory regulations is expanded, primarily by creating new sectors and by granting the member states discretionary powers in this regard. The proposal also introduces a risk management concept for companies. This mainly tightens the safety requirements for them. In this context, the member states are imposed with strict supervisory measures and enforcement requirements on the national authorities. In addition, the proposal decrees coordinated disclosure and cooperation between member states and across the EU, especially in cyber crisis management.

Directive Proposal on the resilience of critical entities:

This proposal aims to ensure that service delivery in the internal market can be ensured by strengthening the resilience of critical infrastructure operators in member states. In particular, this is to be achieved through a better understanding of risks and means to manage them.
 

• On the 15th of December 2020, Commission Executive Vice-President Margrethe Vestager and Vice President Margaritis Schinas are scheduled to present the executive’s review of the Network and Information Systems (NIS) Directive, which entered into force in August 2016. Member states had to transpose the measures into law by May 2018.

Digital for consumers

• Postponed to the Q1/2021: Common chargers for mobile phones and similar devices(legislative, incl. impact assessment, Article 114 TFEU, originally scheduled for the Q3 2020);Review of the Roaming Regulation(legislative, incl. impact assessment, Article 114 TFEU, originally scheduled for the Q4 2020)

A new industrial strategy for Europe

• European Industrial Strategy: On the 10th of March 2020, the European Commission presented a new strategy with which it intends to provide comprehensive support to European industry in the transition to carbon neutrality and digitization. This strategy comprises three key points. (Press release)

1. A new industrial policy strategy comprising a bundle of individual measures
    a) Action plan for intellectual property
    b) Adaptation of EU competition law to the requirements of the digital economy / Green Deals
    c) White Paper on the distorting effects of foreign subsidies on competition in the internal market (mid-2020), which is to culminate in a legislative act in 2021.
    d) Measures to modernize and decarbonize energy-intensive industries
    e) Strengthening Europe's industrial and strategic autonomy through an action plan for critical raw materials and pharmaceuticals
    f) An alliance for clean hydrogen
    g) Further legislation and guidelines on green public procurement

2. A new SME strategy: among other things, the Commission intends to make it easier for small and medium-sized enterprises (SMEs) to go public and therefore support the creation of an Initial Public Offering (IPO) fund within the SME financing window of "InvestEU

3. Action plan to improve implementation and enforcement of single market legislation, which aims to remove obstacles caused by breaches of EU law.

Aviation services package

• Q4 2020: Revision of airport charges(legislative, incl. impact assessment, Article 100(2) TFEU, Q4 2020); Revision of the provision of air services(legislative, incl. impact assessment, Article 100(2) TFEU, Q4 2020)

Towards a European Research Area

• Communication on the Future of Research and Innovation and the European Research Area (non-legislative, Q2 2020);Communication on Horizon Europe research and innovation missions(non-legislative, Q4 2020); Communication on the Future of Research and Innovation and the European Research Area(non-legislative, Q2 2020);Communication on Horizon Europe research and innovation missions(non-legislative, Q4 2020)

Digital finance

• Digital Finance Package: On the 24th of September 2020, the European Commission presented a Digital Finance Strategy and a Retail Payments Strategy in the form of Communications, as well as a number of legislative proposals: (press release)

1. The Proposal for a Regulation on Crypto-Assets (a digital representation of values or rights that can be stored and traded electronically) intends to promote innovation while preserving financial stability and protecting investors from risk. 

2. The Proposal for a Regulation on a Pilot Scheme for Market Infrastructures based on Distributed Ledger Technology aims to ensure an adequate level of consumer and investor protection, to provide legal certainty for crypt assets, to enable innovative companies to use block chain technology, distributed ledger technology ("DLT") and crypt assets, and to safeguard financial stability. Crypto values are one of the most important applications of block chain technology in finance. The Regulation lays down requirements (operating license, operating conditions, supervision, etc.) for multilateral trading facilities and securities settlement systems using distributed ledger technology ("DLT market infrastructures"). DLT is a class of technologies that support the decentralized recording of encrypted data.

3. The Proposal for a Regulation on the Operational Resilience of Digital Systems aims to help block cyber-attacks and improve the supervision of outsourced services.

With the package, the Commission aims in particular to promote Europe's competitiveness and innovation in the financial sector, with four main objectives:

(a) Combating the fragmentation of the digital single market for financial services
(b) EU digital innovations should be in the interest of consumers and facilitate market efficiency (ensuring consumer protection and financial stability)
(c) Creation of a European Financial Data Space to promote data-driven innovation, building on the European Data Strategy
(d) Addressing the challenges and risks associated with the digital transformation, in particular to promote resilience, privacy and appropriate regulatory monitoring

4. The new legal framework also includes a Proposal for a Directive that amends and intends to clarify existing European financial services directives and establish a temporary exemption for multilateral trading facilities in order to strengthen the overall operational stability of digital systems and to ensure legal certainty with regard to Crypto-Assets.