The European Union must streamline overlapping digitalisation rules and provide clear operational guidance, according to Insurance and Pension Denmark, as it warned Europe has “regulated its digital future out of competitiveness”.

In a policy proposal, the association called for a “realistic approach” to digital sovereignty focused on control and digital supply rather than isolation.

It further argued that Europe is “lagging behind” in digital innovation as foreign providers of cloud services, digital infrastructure and artificial intelligence (AI) are ahead in terms of quality.

The lack of competitive European digital solutions means that Europe’s digital infrastructure currently depends on technologies from countries outside the EU, it warned.

Commenting, I&P Denmark deputy director, Sigrid Floor Toft, said: “The new geopolitical situation highlights new challenges, where there is a risk that political actors could effectively switch our digital infrastructure on and off.

“That is why we need to focus on digital sovereignty in Europe. But we must not close ourselves off from the rest of the world. The key objective should be to maintain full control over our data, systems and critical digital functions.”

The association’s warning echoes similar comments from De Nederlandsche Bank (DNB) president, Olaf Sleijpen, who told Dutch pension funds that they are too reliant on non-European IT providers, which must be reduced.

However, in its proposal, I&P Denmark warned against a development in which political ambitions focused solely on self-sufficiency rather than control lead to requirements that, in practice, could restrict access to well-functioning cloud and AI solutions without any viable alternatives being available.

“If we disconnect the solutions that businesses and public authorities depend on today before genuine alternatives exist, we risk weakening the competitiveness of European companies.

“That would affect the economy, welfare and security. We therefore need stable and responsible frameworks for the use of global solutions while strengthening European alternatives over the longer term,” Toft said.

At the same time, the volume of new and complex EU regulation continues to grow, often resulting in rules that are unclear, overlapping and interpreted differently across member states. According to I&P Denmark, this weakens both competitiveness and digital resilience.

Among its proposals, I&P Denmark argued that new digital regulation should only come into force once clear and operational guidance is available, that overlapping digitalisation rules should be streamlined, and that companies should be able to obtain binding rulings from authorities on unclear digital regulations, similar to arrangements already available in the tax system.

The organisation also called for a clearer European responsibility for digital supply security, with providers of critical digital infrastructure being given meaningful accountability obligations.

“We must maintain a responsible European approach to digital rights and security. But it must be done in a way that also enables Europe to compete – and to function – tomorrow and in the years ahead,” Toft concluded.

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