EU to assess export controls on sensitive tech to China

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The EU is to examine bloc-wide export controls in sensitive technology as part of its attempt to “de-risk” its relationship with China and other authoritarian regimes.

The European Commission has identified four areas — semiconductors, artificial intelligence, quantum computing and biotechnology — in which to assess whether the bloc should ban the transfer of some goods and services to other countries.

“Technology is currently at the heart of geopolitical competition and the EU wants to be a player, and not a playground,” Věra Jourová, the EU’s digital chief, told the Financial Times.

“And to be a player, we need a united EU position, based on a common assessment of the risks.”

However, she stressed that the commission would work with the 27 member states before recommending any action and would not “prejudge any measures”, adding: “We will remain an open and predictable global partner.”

Brussels is struggling to create a united front to defend its economic security as the US, China and other countries implement restrictions on exports.

Washington pressured the Netherlands to bar the sale of some advanced silicon chipmaking machines to China this year, leading to calls for the EU to stand together and develop a regime to apply across the bloc. 

Powers to restrict exports on security grounds remain with member states, so the commission is trying to forge a consensus after its president, Ursula von der Leyen, called for “de-risking” from a more assertive China in March.

However, internal disputes have already reduced Brussels’ ambition. The list of technologies to be examined in the short term was cut from 17 to 10 under pressure from economic liberals and some member states.

In addition to the categories announced Tuesday, a further six, including energy, robotics and manufacturing technology could be added next year.

The aim is to complete risk assessments for the first four areas by the end of 2023. These could include the uses of the relevant technologies in weaponry and human rights abuses or the EU’s vulnerability to overseas supplies.

The EU would then decide what action to take using a “promote, protect, partner” approach. “Promote” would include investing in EU production, “partner” would work with other countries on joint concerns and “protect” could involve export restrictions, an EU official said. 

Thierry Breton, internal market commissioner, gave the example of semiconductors where the EU is investing billions to reduce reliance on Asia for supplies. “When we see there is a risk of overdependency . . . we take action.”

Some member states are sceptical about the process. “You can’t do a credible risk assessment for an entire technology. Semiconductors or AI in and of itself are not dangerous or at risk, but elements of those technologies should be protected, while for other elements it could be beneficial to be open,” said an EU diplomat.

“The commission has set too ambitious a timeline to do the work needed to drill down to more detailed analysis.”

The EU also toughened its trade defence measures on Tuesday as the European parliament voted overwhelmingly in favour of an anti-coercion instrument.

This will allow Brussels to retaliate against countries such as China that use methods including trade embargoes to try to put pressure on member states.