- EU unveils €20bn plan to build AI gigafactories and supercomputers.
- AI Liability Directive scrapped due to lack of consensus and harmonization.
- Debate continues over the need for new AI-specific liability rules.
The European Union is embarking on a €20 billion initiative to establish AI gigafactories across Europe. This initiative aims to position the region as a global AI leader.
Meanwhile, the EU has withdrawn its proposed AI Liability Directive. They cited the inability to secure a unified approach across member states as the reason.
Europe’s AI Crossroads: Investing Big, Regulating Carefully
The EU’s multi-billion euro investment in AI infrastructure reflects a strategic urgency to catch up with tech giants like the US and China. The planned gigafactories aim to empower the region to build homegrown foundation models. Currently, these models are dominated by firms like OpenAI, Google, and Baidu.
Rather than continuing to pursue the AI Liability Directive, the European Commission opted for a regulatory pause. Henna Virkkunen defended this move by pointing out the drawbacks. She noted that a directive would have resulted in fragmented national laws. Conversely, a regulation could ensure a more cohesive digital single market.
Reactions from EU lawmakers have been mixed. Some see this as a practical step to simplify Europe’s complex legal framework. However, others—including civil society groups—argue that the lack of a clear liability framework leaves consumers vulnerable. This is especially concerning in the event of AI failures or harm.
Despite regulatory uncertainty, the EU’s infrastructure-first approach marks a significant shift in its digital policy. If executed effectively, these gigafactories could lay the groundwork for both AI innovation and eventual regulatory cohesion.
Europe is laying the physical foundation for AI leadership while navigating legal and political complexities. They are balancing ambition with caution in a rapidly evolving space.
“The global race for AI is far from over.” — Henna Virkkunen, European Commission Vice-President
