The Framework

The European Union Cloud Services Scheme (EUCS) is a cybersecurity certification framework established under the EU Cybersecurity Act, developed by the European Union Agency for Cybersecurity (ENISA), aimed at standardizing cloud service security across the European Union.[1] Although participation in EUCS is formally voluntary, the NIS2 Directive and the proposed Data Act grant EU member states and enforcement authorities the power to require public bodies, essential and important entities, and potentially commercial users to rely only on EUCS-certified providers.[2] Earlier EUCS drafts included explicit sovereignty-based eligibility restrictions, such as headquarters location and jurisdictional exclusions for non-EU providers. While these requirements were removed in recent revisions, they remain under debate and may be reintroduced through member state implementation or complementary legislation, such as the Cybersecurity Resilience Act.[3] Certification at higher assurance levels includes strict data localization, restrictions on non-EU legal access, and requirements for oversight by EU-based personnel. In practice, these measures—combined with industrial policy efforts to “de-risk” reliance on non-EU cloud technologies—could significantly constrain market access for U.S. cloud providers and shift procurement toward European competitors. The final EUCS text remains under negotiation, and enforcement pathways may develop unevenly across member states.

Implications for U.S. Technology Leadership

The EU’s emerging cloud certification regime and associated digital sovereignty policies risk marginalizing U.S. cloud providers in both public and commercial markets across Europe. While formally non-mandatory, the EUCS framework, combined with the NIS2 Directive and Data Act, creates legal pathways for national authorities to require businesses to use only EU-certified providers. These certification requirements include restrictions on foreign jurisdiction, data localization, and potential reintroduction of EU-headquarters conditions, making compliance especially burdensome for U.S. firms. This layered regulatory design functions as a de facto barrier to entry, distorting competition in favor of domestic or EU-based providers.

Framing these policies as responses to U.S. laws, such as the CLOUD Act and FISA 702, European officials have justified excluding U.S. firms from public procurements under the banner of sovereignty, despite advocating for similar extraterritorial access powers in the EU e-Evidence Regulation. The growing trend toward industrial protectionism—backed by security narratives and “de-risking” strategies—undermines the ability of U.S. firms to scale cloud operations uniformly across the EU. If implemented aggressively, this digital protectionism risks eroding the U.S.'s tech leadership in cloud infrastructure, particularly in high-value sectors such as finance, public services, and defense-related digital services.[4]

Endnotes