EUU, Alm.del - 2024-25 - Bilag 594: Notat samt høringssvar vedr. Cloud and AI Development Act (CADA)

Europaudvalget 2024-25
EUU Alm.del Bilag 594
Offentligt

Case no.

2024 - 3106

Document no.

153033

Date

01/07/2025

Danish Government Response to the European Commission’s Call for Evi-

dence on the Cloud and AI Development Act (CADA)

Executive Summary

Denmark supports the ambition to strengthen Europe’s capacities within cloud and data pro-

cessing. This is key to the EU’s long-term competitiveness, resilience, and open strategic au-

tonomy. However, expanding capacity alone is not sufficient. To be effective, CADA must help

close implementation gaps, address market failures, and foster demand and uptake - espe-

cially among public-sector actors.

Rather than introducing new regulation, Denmark encourages the Commission to focus on

making existing instruments work better. Many of CADA’s objectives can be achieved through

improved implementation, smarter enforcement and targeted use of non-regulatory tools

such as guidance, templates, and voluntary frameworks.

CADA should promote a simple, pragmatic and demand-driven framework - one that builds

on what is already in place, strengthens interoperability and sustainability, and empowers

public institutions to act as informed, strategic users. It should support open strategic sover-

eignty without protectionism, foster transparency through standards and open source, and

respect Member States’ competences and planning prerogatives.

On this basis, Denmark recommends that CADA pursues the following eight objectives:

1. Prioritise practical implementation, enforcement and smarter use of existing instruments

Many of the tools to tackle issues, which CADA seeks to address - such as access to secure and

trustworthy cloud and data processing services and a competitive market - already exist in in-

struments, such as the Data Act, NIS2, the Interoperable Europe Act, DMA, AI Act and GDPR.

The main challenge is not a lack of rules, but fragmented implementation, inconsistent en-

forcement and lack of coordination. CADA should therefore prioritise:



Clarifying legal overlaps,

Coordinating and streamlining enforcement by using existing governing structures,

Developing practical guidance and templates,

Enabling knowledge sharing across Member States.

In many cases, soft law - such as model clauses, reference frameworks and technical guide-

lines - can be more effective than new regulation. This is especially true in fast-moving areas

such as cloud, data and compute. CADA should avoid regulatory overreach and reaffirm the

EUU, Alm.del - 2024-25 - Bilag 594: Notat samt høringssvar vedr. Cloud and AI Development Act (CADA)

importance of subsidiarity, particularly in areas such as planning and permitting, where Mem-

ber States, regions and municipalities are best placed to act.

To mitigate the risk of creating unnecessary bureaucracy, the Commission should prioritize

the use of relevant governing structures under existing legislation, such as the European Data

Innovation Board (EDIB), the AI-Board, and the Digital Decade Board. This is essential to en-

sure an effective implementation and coordination between Member States and the private

sector.

2. Address structural market barriers and build user-side capacity

Denmark has already implemented many of the measures frequently highlighted as solutions

and preconditions for increased European cloud development; including suitable zoning,

streamlined permitting procedures and strong availability of renewable energy. However,

while these efforts have successfully attracted investments in the construction of data centres

in Denmark, they have not translated into a more competitive or diverse cloud market. The

Danish domestic cloud landscape remains dominated by a small number of non-EU hyperscal-

ers.

This reflects a broader structural issue: expanding or scaling physical infrastructure is neces-

sary, but not sufficient. Without addressing the underlying market barriers - such as vendor

lock-in, bundling of services, and a lack of contractual and technical transparency - competi-

tion and resilience in the European cloud ecosystem will remain limited, which in turn stands

in the way of achieving the goals of stronger EU capacities in cloud.

We therefore recommend that CADA seeks to address these issues via measures that pro-

mote:



Interoperability and portability,

Modular and unbundled services,

Data and application portability,

Legal and technical capacity and knowledge among cloud users,

Reduced administrative burden for those procuring compliant services.

These steps are crucial to ensure that public and private investments can strengthen the posi-

tion of European providers and foster a more open, competitive and diverse cloud ecosystem.

3. Take a demand-driven, pragmatic approach to infrastructure expansion

Infrastructure expansion must be driven by documented and differentiated needs - not politi-

cal narratives or assumptions of scarcity. Demand should be disaggregated by use case and

sensitivity: foundation model training, inference workloads, and fine-tuning each place differ-

ent demands on compute infrastructure.

Before launching large-scale initiatives, such as TEFs or IPCEIs, we recommend the Commis-

sion ensure that investments deliver real value. The Commission should conduct regular as-

sessments to identify where capacity is most needed and how it can best support demand

and strategic objectives. This could include:



mapping of current and projected demand,

differentiation between sectors and data sensitivity,

and consider factors such as latency, connectivity and sustainability constraints.

Denmark advocates for a pragmatic, stepwise model of infrastructure expansion that priori-

tises scaling and expanding access to existing infrastructure where possible. Infrastructure al-

ready meeting high standards for security, sustainability, and compliance with EU legal frame-

works, such as GDPR and NIS2, should be considered a natural first choice.

EUU, Alm.del - 2024-25 - Bilag 594: Notat samt høringssvar vedr. Cloud and AI Development Act (CADA)

This approach enables quicker results, lower investment risk, and better integration with op-

erational needs. Central to this is avoiding over engineered, capital-intensive projects that risk

becoming technologically obsolete before deployment. Instead, a "frugal innovation" model,

where infrastructure evolves iteratively in response to actual user demand, is better suited to

Europe's diversity and pace of technological change.

Such a model should promote inclusion of smaller providers and more agile solutions, while

also improving long-term cost efficiency and strategic adaptability. Investment should not

only cover physical hardware but also ensure the necessary operational capabilities - includ-

ing skilled personnel, energy and thermal management, data governance, and security opera-

tions - are in place to operate and scale the infrastructure responsibly.

4. Support a functional, risk-based approach to digital sovereignty

CADA should support a clear and operational understanding of digital sovereignty. Sover-

eignty must be based on actual needs and risks - particularly in handling sensitive public sec-

tor data or critical infrastructure. Full technological autonomy for all use cases and across the

full stack is neither realistic nor desirable.

Denmark recommends that sovereignty be understood as the ability to make independent

choices, and be anchored in clear, operational and measurable criteria:



Legal and operational control within European jurisdiction,

Compliance with Data Act, GDPR and NIS2,

Ability to switch providers and maintain operations,

Absence of undue influence from non-EU legislation or ownership,

Rather than mandating EU-only solutions, CADA should support risk-based approaches that

combine trust, flexibility and resilience. Trusted access to non-EU technology should remain

possible when justified and well-managed.

The public sector plays a key role in driving demand. CADA should support the development

of optional model requirements for procurement, to make it easier for institutions to express

preferences for sovereign solutions - without creating new legal uncertainty or disproportion-

ate obligations or fragmentation in the internal market.

5. Leverage public procurement as a strategic enabler

Public procurement is one of the strongest tools to shape market outcomes. Yet many public

buyers, especially smaller public entities, lack the legal clarity, knowledge and capacity to op-

erationalise broader policy goals such as sovereignty or sustainability.

We would therefore recommend, that the CADA supports public buyers through:



Development of voluntary model clauses and templates,

Clear guidance on proportionality and legal compatibility,

Education and guidance on development and use of multi-cloud solutions,

Optional frameworks for use in critical or sensitive domains.

Public buyers must retain discretion, but they should be empowered to use it. Preferences for

European and/or sovereign solutions should be enabled, not mandated, and always aligned

with competition law and the principles of equal treatment and transparency.

6. Promote openness through open source and open standards

To strengthen interoperability, reduce dependency, and ensure long-term digital resilience,

CADA should promote the use of open standards and open source software - particularly in

public infrastructure, AI development, and cross-border services.

EUU, Alm.del - 2024-25 - Bilag 594: Notat samt høringssvar vedr. Cloud and AI Development Act (CADA)

Open technologies enhance user control, reduce vendor lock-in, and make it easier to imple-

ment legal, security, and sovereignty requirements. They also support transparency and au-

ditability, which are essential in high-risk or mission-critical applications.

Denmark supports the principle that public investments in digital solutions should, where fea-

sible, promote openness and reuse. This requires not only procurement alignment, but also

sustained coordination, governance and technical capacity.

We propose that CADA therefore:



Recommends the use of open standards for data formats, APIs and service interfaces

to facilitate interoperability and data mobility,

Encourages the adoption of open source components where transparency, trust and

long-term adaptability are essential,

Supports efforts to promote the use of open source and open standards in in public

institutions – including coordination, development, usage, contributions and compli-

ance efforts,

Provides voluntary guidance and technical frameworks to help public buyers inte-

grate openness into procurement strategies,

Explore targeted EU-level support for the maintenance and development of critical

OSS infrastructure, particularly components underpinning cloud and AI systems,

Consider the general principle of “Public Money – Public Code” as a guiding value in

EU digital programmes and EU digital grants, however not necessarily in tenders and

procurements or in the development of critical public IT systems.



A common EU policy on open source that goes beyond the Interoperable Europe Act should

be considered, which inter alia address legal and contractual barriers – including liability con-

cerns, which remain a key barrier. Possible approaches could include model clauses for public

procurement, clarification of liability scopes and mechanisms for shared risk or assurance in

the use of critical OSS components.

7. Align infrastructure investments with climate goals, efficiency and real operational needs

Cloud and compute infrastructure can place significant strain on energy and water resources.

CADA should promote the use of clear environmental criteria in the planning and support of

cloud infrastructure, in line with EU climate goals and Green Public Procurement frameworks.

These should include:



Energy efficiency benchmarks (e.g. PUE, CUE, WUE) building upon the EED data,

Renewable energy sourcing and traceability,

Transparency on water usage and cooling,

Circularity of hardware components,

Integration with local energy and heating systems.

Geographical distribution should not come at the expense of environmental performance. Lo-

cation decisions must reflect demand as well as overall climate impact. For example, regions

with abundant renewable energy and natural cooling offer particular advantages that should

be utilised. Cloud and compute infrastructure must be designed for efficiency, and location

decisions should leverage existing synergies between energy availability, climate conditions

and infrastructure.

Broad geographical dispersion is only relevant for workloads with strict latency requirements.

For most applications, centralised or regionally clustered capacity provides better efficiency,

scalability and sustainability. A climate-smart and strategically placed infrastructure footprint

is not only better for the environment – it also enhances long-term competitiveness, provided

that initiatives focus on real operational needs rather than symbolic distribution goals.

EUU, Alm.del - 2024-25 - Bilag 594: Notat samt høringssvar vedr. Cloud and AI Development Act (CADA)

8. Respect subsidiarity and Member State competences

CADA must fully respect national competences, especially in spatial planning, land use and

permitting, which are constitutionally anchored and politically sensitive in many Member

States.

Top-down mechanisms, such as automatic approvals or EU-level deadlines, risk undermining

legitimacy and may prove counterproductive. Instead, alignment should be supported

through:



Voluntary coordination and best practice exchange,

Voluntary European targets for maximum processing times,

Targeted funding for administrative capacity and training,

Optional technical guidance tailored to national systems.

Subsidiarity is not a barrier to progress but a condition for effective and legitimate digital pol-

icy.

Conclusion

Denmark welcomes the Commission’s initiative and supports the overall goals of the Cloud

and AI Development Act. In summary, we urge the Commission to ensure that CADA:



Builds on and streamlines existing frameworks,

Focuses on enforcement, implementation and practical guidance,

Addresses market barriers and fosters user-demand,

Supports a strategic and open approach to digital sovereignty,

Leverages public procurement as a strategic enabler

Promotes interoperability, transparency and trust through open source and stand-

ards,

Aligns infrastructure planning with climate goals, efficiency and operational needs,

Respects principles of subsidiarity and Member State competences.

A successful CADA must combine ambition with pragmatism and support Europe’s ability to

build an open, trusted and competitive digital future.

We appreciate the opportunity to contribute to this consultation and look forward to contin-

ued engagement and collaboration on this file.