Cloud and AI Development Act (CADA): New EU legislative proposal on cloud and AI
The Cloud and AI Development Act (CADA) is a proposal for EU legislation, focused on cloud services and AI, put forward by the European Commission in June 2026. CADA is part of the Commission’s European technological sovereignty package, which also includes the Chips Act 2.0, the EU Open Source Strategy, and the Strategic Roadmap for Digitalisation and AI in the Energy Sector.
The European Commission's proposed Cloud and AI Development Act (CADA) aims to strengthen the EU's cloud and AI ecosystem
CADA aims to strengthen the EU's cloud and AI ecosystem and infrastructure build-out. It also aims to reinforce the European Union's technological sovereignty.
What is technological sovereignty?
Technological sovereignty means the ability to act independently in the digital world by developing technologies, data, and infrastructure. A key part of technological sovereignty is reducing dependence on external suppliers — for example, cutting the EU's reliance on technology and digital service providers based outside the Union. Technological sovereignty is closely linked to digital sovereignty. Digital sovereignty is often seen as the broader concept, and technological sovereignty as its technology-focused subset. You can find more information about digital sovereignty on our earlier blog article: What is digital sovereignty.
CADA's objectives
CADA aims to support research and innovation in technologies related to cloud services and AI. It also seeks to strike a balance between AI ambitions and climate commitments.
In practical terms, CADA's goal is to triple Europe's data centre capacity over the next five to seven years and to simplify the conditions for deploying data centres. CADA complements the Apply AI strategy in accelerating the adoption of AI and cloud across Europe.
CADA focuses on three main objectives:
Research, development and innovation: supporting the adoption of cutting-edge, sustainable cloud and AI technologies
Capacity: accelerating data centre deployment across the EU (particularly for public sector needs)
Autonomy: introducing an EU-wide assessment framework for cloud and AI sovereignty
CADA defines four assurance levels for cloud services
CADA defines four assurance levels that the public sector will use for cloud services. Following an audit, cloud service providers could be classified under one of these assurance levels.
CADA's four assurance levels are:
Level 1: data is processed and stored on infrastructure located within the Union.
Level 2: the provider can demonstrate independence from third countries, as well as transparency in its software supply chain.
Level 3: the provider is owned and controlled from the EU and meets other criteria (such as personnel citizenship). The Commission may recognize providers from third countries.
Level 4: the provider is fully transparent and controls its software supply chain without interference from third countries.
How CADA connects to other EU legislation
CADA also connects to other EU legislation. For example, the NIS2 Directive (NIS = Network and Information Systems) aims to improve the cybersecurity of cloud service providers and data centres across the EU. NIS2 does not, however, aim to increase the deployment of cloud services or data centres, which CADA is set to influence going forward. CADA also supports the objectives of DORA (Digital Operational Resilience Act), which governs digital operational resilience in the financial sector.
You can find more on NIS2 and DORA in our earlier blog post: NIS2 and DORA: What are they and what do you need to know. We've also written about NIS2 requirements in an earlier post: Who is affected by NIS2, and what requirements does it put on companies.
More information and help with CADA
You can find more information on CADA on the European Commission's website:
If CADA has sparked your interest and you're planning to develop your own cloud services or AI capabilities, we can help you find the experts you need! We have, for example, skilled Cloud Developers and Full-Stack Developers well-versed in AI tools. Get in touch through the chatbot MarCo (in the bottom right corner), or via our contact page, and we'll find the right expert for your project!
