AI is shifting sovereignty to private firms, EU must respond

An analysis in Rest of World argues that AI is shifting sovereignty from states to private tech companies, concentrating economic and political power in a handful of firms. That trend is already shaping regulatory debates across the United States, China and the European Union, and it raises direct choices for policymakers and organisations that depend on large language models, cloud compute and global platforms.

How the sovereignty shift looks and how regulators are responding

The analysis documents several mechanisms that transfer authority away from public institutions. Massive models and centralised compute give platforms control over information flows and commercial terms, network effects lock users into a few providers, and opaque supply chains make public oversight hard. China responded to a similar concentration with a forced restructuring between 2020 and 2023 that split Alibaba into six entities, while U.S. authorities have pursued antitrust cases through the Department of Justice and the Federal Trade Commission. The EU has taken a different path by writing rules to shape market structure and behaviour before harms multiply, notably the AI Act together with the Digital Markets Act and Digital Services Act.

Those EU rules create obligations that matter in practice. The AI Act will require higher risk systems to publish risk assessments and governance practices, the DMA targets gatekeeper behaviour such as self preferencing and interoperability, and the DSA adds transparency obligations for hosting services. Civil society groups are pressing for DSA enforcement to centre human rights and include organised user representation, and that pressure matters because enforcement will determine whether rules actually shift power back toward publics. At the same time, national politics complicate enforcement: Spain is proposing a draft law to ban under 16s from social media and to hold platform executives criminally responsible, a move that illustrates how national pressures can push EU member states to exceed, reinterpret or test EU frameworks.

For European firms, the regulatory mix is both an opportunity and a cost. Firms that embrace transparency, disclose training data provenance and publish energy use can differentiate from U.S. and Chinese incumbents, but compliance and reporting will raise operating costs and may slow innovation. For publics and businesses, the key contingency is whether enforcement is robust enough to make a market for accountable alternatives sustainable.

Why This Matters

This matters for any team deciding whether to host critical workloads with U.S. cloud AI providers or to shift to EU based vendors that commit to AI Act style transparency. A survey by Proton shows broad public appetite for European alternatives, with majorities in Germany, France and the U.K. saying societies depend too much on U.S. tech and preferring EU apps if parity is reached. If your organisation prioritises model provenance, energy reporting and GDPR compliance, favour vendors that publish model training details and energy use, and that accept the AI Act reporting regime. Multiple developments this month, from civil society demands for human rights centred DSA enforcement to national proposals in Spain, confirm that regulatory pressure is accelerating. Choosing an EU compliant provider now reduces legal and reputational risk compared with continuing to rely solely on providers with opaque governance.

What You Should Do: Begin an audit of which AI services you rely on, prioritise vendors that disclose training data and energy metrics, and track AI Act implementation timetables so procurement and compliance teams can align contracts with upcoming obligations.

Sources

Rest of World analysis on AI and sovereignty

Politico EU coverage of Spain's draft social media law

Proton survey on European preference for alternatives to U.S. tech

EFF Deeplinks on the DSA Human Rights Alliance principles

Watch implementation of the AI Act and the outcomes of major antitrust cases for the next clear signal about whether regulatory power will restore public authority over silicon sovereigns.