DIGITALEUROPE’s reaction to the Virkkunen and Séjourné hearings: “An ‘Act’ is not the answer to everything”

Tuesday 12 November two key Commissioners for the digital sector – EVPs Henna Virkkunen and Stéphane Séjourné – were questioned by MEPs on their plans for the next five years.  

Director-General Cecilia Bonefeld Dahl said:

“It’s a thumbs up from DIGITALEUROPE for both EVP Virkkunen and EVP Séjourné.  

Both recognised that we can’t become a digital powerhouse just by adding more and more rules. We need to simplify legislation, ease the compliance burden on companies and to promote public and private investment. 

To ensure Europe’s prosperity and security we need to protect critical infrastructure and create a true digital single European market to support our companies to scale and create critical tech innovations.” 

5 things we liked from (and one we didn’t) 

1. Removing hurdles for businesses to win the tech race 

As EVP Virkkunen said, “An ‘Act’ is not the answer to everything.” She said that cutting red tape would be a priority during her time in office, and said she would ask for a list of reporting burdens from her team on day one [memo from DIGITALEUROPE – we can help with that!]. Séjourné agreed, saying “this term has to be about simplification”, proposing a “stress test” of regulation sector by sector to remove unnecessary rules. 

2. Shifting the narrative on AI 

“I want Europe to be an AI continent”, said Virkkunen, proposing an AI factories initiative, an ‘Apply AI’ Strategy focused on cars, robotics and pharma, and an AI Cloud and Development Act. Séjourné agreed: “We haven’t done enough work on ensuring that new technologies are harnessed”. 

We have long called for a fresh approach to raise the disappointingly low 8% AI uptake by businesses in Europe. Encouragingly, Virkkunen acknowledged that for the vast majority of AI uses there is no risk to citizens. This is not the impression that you would have got after following the last five years of debates in Brussels, and marks a welcome shift in tone. 

3. Investment at the heart of our industrial strategy 

Séjourné acknowledged that our clean tech and digital technology sectors “aren’t growing fast enough”. On the problem of financing, he spoke about a new competitiveness fund that would form part of the upcoming EU budget, although there were not too many details. He supported our idea to have a one stop shop to help companies get access to funding in one place. He also mentioned the need to wake up the €10 trillion ‘sleeping’ in Europeans’ bank accounts. The focus should be on closing the critical tech gap.

With government contracts accounting for 14% of GDP in Europe, we support his pledge to review the public procurement directive, going from the “lowest bidder to the best bidder.” He also confirmed there would not be discrimination against non-EU firms: “it is not about where a company comes from but whether it contributes to European wealth”. 

4. Acting as one, not as 27 

EVP-designate Séjourné was clear that the Single Market was a top priority. He said, “the barriers are the same ones that business reported 20 years ago”, and supported Enrico Letta’s call for a ‘28th regime’ – that’s a European Business Code that will support businesses to scale across borders and make use of our unique market of 500m people. 

He also said that he would bolster the existing notification system, where Member States let the Commission know about new legislation that could impact the single market. Let’s stop more barriers before they are put in place. 

5. Steadfast support for Ukraine and transatlantic cooperation 

The “best investment for European security is investing in the security of Ukraine,” said Virkkunen. “Europe needs to invest more and invest better and invest together”. We agree: not only is Ukraine fighting bravely on the front line against Russia, it’s also one of Europe’s most digital-savvy continents, and we have a huge amount to learn about how they are innovating and deploying technology on the battlefield. That’s why it was right to link technology and security in Virkkunen’s portfolio. 

In testing times, both also highlighted the need to keep cooperating with the US and to avoid a costly trade war. 

And one thing we didn’t like: 

Yet more rules on AI and data on the horizon? 

In the last mandate, we already added a Data Act and a Data Governance Act on top of GDPR, and the complex rules are causing headaches for business. Do we really need another Data Union Strategy? We should also make sure the new AI Act is implemented properly, there’s no need to add extra complexity with more AI rules not sectorial no ether AI liability directive, it is all covered in existing regulation.