The European Union's AI Continent Action Plan (the "Action Plan"), published in April 2025, sets out a unified roadmap to position Europe as a global leader in artificial intelligence. It outlines how the EU intends to invest in AI infrastructure, enhance data access, support sectoral AI adoption and develop critical AI skills and regulation, in order to build a competitive and ethical AI ecosystem rooted in European values.
We set out below what you need to know about the five strategic pillars of the Action Plan and the implications for technology providers and adopters in the EU and UK.
Five strategic pillars of the Action Plan
1. Building European AI infrastructure
The EU is expanding its AI infrastructure to strengthen its technological sovereignty and global competitiveness. Central to this effort are:
- AI Factories: Advanced hubs combining supercomputing, data resources and innovation ecosystems to support AI research, startups, and public sector applications. These are expected to be fully operational by the end of 2025.
- AI Gigafactories: Large-scale centres with over 100,000 processors to train sophisticated AI models, including Artificial General Intelligence. Supported by the new InvestAI facility, this initiative aims to mobilise €20 billion in public and private investment in cloud and AI infrastructure.
To address deficiencies in EU cloud and data infrastructure, the EU will propose a Cloud and AI Development Act. This legislation will simplify the permitting process for data centre construction across member states, promote energy-efficient data centres and reduce reliance on non-EU cloud services, aiming to triple EU data processing capacity within five to seven years. Public consultation on this legislation is now closed, with Commission adoption planned for Q4 of 2025.
2. Enhancing access to high-quality data
The forthcoming Data Union Strategy, set for release in late 2025, aims to strengthen Europe's data ecosystems by improving interoperability and enabling broader access in the EU to cross-sector data. The strategy addresses the shortage of high-quality data essential for AI development, aligning data policies with the needs of businesses, the public sector and society. At the same time, it maintains strong safeguards to ensure data remains confidential, secure and trustworthy. To reduce complexity, it will streamline existing legislation and governance.
Key initiatives include:
- The creation of Data Labs under the AI Factories initiative, providing access to large volumes of sectoral data, such as health and energy, and offering data-pooling services within the framework of the Data Governance Act.
- Simpl, a shared cloud software designed to simplify the management and connection of data spaces.
- Alliance for Language Technologies (ALT-EDIC), launched in March 2025, will unite 17 Member States to build a multilingual data repository, supporting Europe's linguistic diversity and technological leadership. The strategy also seeks to cut bureaucracy, aiming to simplify compliance with EU data rules and encourage international data sharing, with safeguards for sensitive EU data.
3. Accelerating AI adoption in strategic sectors
The Apply AI Strategy aims to boost AI deployment across key industries in Europe, with a particular focus on sectors where Europe already holds a competitive edge, such as advanced manufacturing, aerospace, defence, agri-food, energy, mobility and public services. Key components include:
- The transformation of European Digital Innovation Hubs into AI Experience Centres. These centres will provide hands-on support to developers of AI technologies through training, funding advice, and access to Testing and Experimentation Facilities (TEFs). TEFs simulate real-world environments in sectors like health, agriculture, and energy—helping companies refine AI solutions in practical, high-stakes settings. The goal is to empower smaller companies and public administrations with the tools, resources, and confidence to adopt AI effectively.
- Pilot projects that bring generative AI into public administration and the creation of the European AI Research Council (RAISE) to coordinate and support both foundational and applied AI research across Europe. To track progress and guide future policy, the EU plans to establish an observatory under the EU AI Office, ensuring transparency and accountability as adoption scales.
4. Strengthening AI skills and talent
As AI continues to reshape job profiles and required skillsets across sectors, the EU must urgently address talent shortages and skill mismatches through high-quality, inclusive education and training. The Action Plan aims to:
- Promote AI literacy in schools and empower teachers through the 2030 Roadmap on Digital Education and AI in Education initiative.
- Expand the pool of AI specialists, while upskilling and reskilling workers and citizens through educating and training the next generation of AI experts in the EU, incentivising talent to stay or return, and attracting skilled AI professionals from non-EU countries. This will be done by increasing the availability of AI-focused degrees and PHDs, launching the AI Skills Academy and piloting an AI apprenticeship programme.
- Host European Advanced Digital Skills Competitions to involve young people in developing AI solutions to real-world challenges and foster collaboration between academia and industry.
5. Fostering regulatory compliance and simplification
To support a thriving and competitive AI ecosystem, the EU has adopted the AI Act, establishing a harmonised framework to create a well-functioning single market for AI, ensuring the free circulation of AI systems across borders. The AI Act aims to ensure that AI developed and deployed in Europe is safe, respects fundamental rights and meets high-quality standards - a USP for European providers. Following a targeted, risk-based approach, the AI Act imposes obligations only on high-risk AI applications. It entered into force on 1 August 2024 and will be fully applicable by August 2027.
Mechanisms to support implementation of the AI Act include:
- AI Act Service Desk: A free platform offering tailored guidance, especially for SMEs.
- AI Pact: Stakeholder engagement.
- Regulatory sandboxes: Controlled environments for testing AI solutions.
What does this mean for the future of tech?
Whilst the ultimate impact of the Action Plan will depend on how effectively and swiftly it's implemented, its ambition alone signals a powerful shift in how governments, industries and societies are preparing for the future of technology.
It recognises AI's growing role in shaping the world - and its criticality to the next wave of innovation, economic growth and societal transformation.
1. A global shift in tech leadership to Europe?
For years, Europe has been perceived as lagging behind the US and China in AI, playing the role of regulator more than innovator. Critics have pointed out that the EU's caution, especially in regulation, has often come at the cost of speed and agility in the tech space1. But this Action Plan aims to flip that narrative.
By backing bold initiatives, the EU is now building the technical capabilities needed to compete globally. If successful, this could reduce Europe's reliance on non-European platforms and ultimately position EU-born technologies as serious global contenders.
Crucially, the plan doesn't compromise on values. The AI Act anchors these developments in a framework of ethical, safe and rights-based AI, potentially turning what some saw as a constraint into a competitive advantage. In a world increasingly concerned with tech safety, privacy and bias, Europe's human-centric model might just become the new global standard.
2. A more inclusive future for tech companies
Perhaps one of the most promising aspects of the plan is its focus on making AI adoption accessible not just for tech giants, but for SMEs and mid-sized innovators too. Tools like the AI Act Service Desk, regulatory sandboxes and simplified compliance pathways are designed specifically to lower barriers to entry. By offering free advice, tailored guidance, and support structures, the EU is opening the door for smaller players to compete and innovate within a fairer, more level playing field.
This could reshape global tech dynamics. The push for "AI made in Europe" doesn't only serve EU companies, it creates a model where innovation is more distributed, and where talent and ideas from smaller markets can thrive.
3. Public sector transformation and perception shift
Another critical shift the plan encourages is the adoption of AI in the public sector. From healthcare and education to justice and environmental monitoring, the EU envisions AI as a tool to improve the quality and efficiency of public services. These pilot initiatives could be a turning point in public perception moving away from fear or scepticism, and towards trust in AI's ability to serve the common good.
This, in turn, could have a ripple effect: as citizens begin to see AI making tangible, positive impacts in their everyday lives, broader societal acceptance and demand for responsible AI innovation could follow.
4. Building a future-proof AI ecosystem
What makes the EU's approach stand out is its system's thinking. The Action Plan isn't just a collection of isolated projects - it connects infrastructure, data policy, skills, research, industry support, and regulation into a single, evolving ecosystem. This long-term, holistic view is what gives the plan real potential. If backed by consistent political will, private investment, and ongoing cross-sector collaboration, it could set a blueprint for how regions and countries prepare their tech ecosystems for the future - not just to compete, but to lead responsibly.
What does it mean for those operating in the UK?
The EU's AI Continent Action Plan has significant implications for UK AI businesses, researchers and policymakers - despite the UK no longer being an EU member.
The UK has its own AI Opportunities Action Plan, aimed at accelerating the use of AI across the UK economy. The EU's strategy mirrors the UK's in key areas such as compute infrastructure (AI Factories vs AI Growth Zones), strategic data access (EU Data Union vs. National Data Library) and SME transformation and sectoral AI adoption. It also has a detailed sector plan for Digital and Technology to strengthening the UK's role in the global tech economy – see our recent article Supporting growth: what the UK's Industrial Strategy could mean for tech businesses. Again, this mirrors themes around creating a skilled workforce, delivering pro-innovation regulation and boosting R&D investment.
UK businesses operating in or exporting to the EU will need to comply with the EU AI Act, especially for high-risk AI systems. Such business should therefore seek to engage with EU AI consultations (e.g. Cloud and AI Development Act, Apply AI Strategy) and monitor regulatory developments to ensure compliance and interoperability.
There are also opportunities to participate and partner with EU organisations. In May 2025, the UK government announced plans for a new AI collaboration with Europe, building on the UK's new deal with the EU. This invites UK public research organisations to step forward to become Britain's link to the continent's top supercomputers. The UK is also part of the EuroHPC Joint Undertaking (EuroHPC JU), which is an EU-led initiative that pools resources from the EU and participating countries to develop European computing infrastructure and research capabilities.
Want to know more?
The Action Plan represents a defining moment in Europe's digital evolution. Whether you're simply curious about the future of AI, keen to understand how the Action Plan might affect your organisation or seeking tailored advice on AI and tech-related matters, support is available.
If you'd like to explore the implications further, ask questions or discuss how this strategy could impact your sector, get in touch with Jocelyn Paulley or Alexi Markham from our AI team.
Footnote
1 The European AI Continent Action Plan
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