June 3, 2026 | Law Introduction | Data Governance

On 3 June 2026, the European Commission proposed a Regulation establishing a framework of measures to strengthen Europe’s cloud and artificial intelligence ecosystem (Cloud and AI Development Act). The proposal sets out a Union-level framework aimed at reinforcing the cloud and AI ecosystem through five main areas. These include the creation of the Cloud Leadership Initiative and the AI Leadership Initiative to support research, innovation, and the large-scale deployment of cloud and AI capacity, the introduction of a framework to accelerate the rollout of data centres across the Union including through designated data centre acceleration zones and strategic data centre projects, and the development of a sovereign cloud and AI offer intended to support public order through a Union cloud sovereignty framework with four assurance levels and a recognition mechanism for cloud service providers. It also seeks to reduce dependencies on critical technologies and to promote the uptake of cloud services within the public sector. Under the proposal, Member States would be required to adopt national cloud and AI strategies within one year of the Regulation entering into force. It introduces mandatory risk assessments for contracting authorities and Union entities to determine the appropriate Union assurance level for public sector activities, while also requiring that public procurement of cloud services meets at least Union assurance level 1. The proposal establishes a European public sector cloud federation, referred to as the EuroCloud Federation, to enable the sharing of data centre and cloud computing resources among Member States, alongside a common procurement framework for Union entities and contracting authorities. It further requires Union entities to prioritise open-source solutions and obliges Member States to set up Open-Source Programme Offices. The legal basis for the proposal is Articles 114 and 173(3) of the Treaty on the Functioning of the European Union, and it will be adopted under the ordinary legislative procedure. The Regulation would enter into force on the twentieth day following its publication in the Official Journal of the European Union and apply one year thereafter.