Digital sovereignty explained: why Europe needs technological control now

Who truly holds authority over your corporate data today? If you rely on US hyperscalers or non-European cloud solutions, the answer is often: not you alone. In a world where data is the hardest currency, digital dependency is becoming a threat to economic autonomy. In Germany alone, cyberattacks now cause annual damages running into hundreds of billions of pounds.

But how do you regain independence? In this article, we analyse what sovereignty means today, where German companies currently stand, and what is required for a secure future.

TL;DR – the essentials at a glance

• Definition: Digital sovereignty means controlling infrastructure, data, and processes in a self-determined manner without losing access to innovation.

• Geopolitics: Dependencies in software are increasingly being used as political leverage.

• Reality check: Many companies underestimate their obligations or rate their security too positively. In emergencies, many also resort to insecure makeshift solutions.

• Proposed solution: The path to strengthening digital sovereignty leads through software ‘made in Europe’, technical protection layers, and a proactive security culture.

What is digital sovereignty exactly? Definition

True digital sovereignty has nothing to do with isolationism. It describes the ability of the state, the economy, and individuals to control digital infrastructures, data, and processes in a self-determined way. It is about maintaining targeted independence in critical technologies without decoupling from global innovation.

Those acting with digital sovereignty make their own decisions on three levels:

• Data: You retain exclusive control over your most valuable asset. You alone determine who accesses what information and when. Strong encryption is the foundation here.

• Software: You avoid dependency on opaque third-party providers. Sovereign software is interoperable – it can be flexibly integrated into modern workflows. This prevents you from being tied to insecure solutions that dictate terms or cause you to lose control over the further development of your own IT strategy.

• Infrastructure: You store and transfer data where European standards, such as the GDPR, apply without compromise. In doing so, you remove yourself from the legal grey areas and access powers of extraterritorial laws (such as the US Cloud Act).

Why we must rethink sovereignty in 2026

The geopolitical situation makes this issue a matter of survival for the economy. Anyone building critical processes on cloud services whose technical core is controlled abroad is accepting a creeping ‘cyber dominance’ by foreign actors. The problem with many US hyperscalers is the legal framework: through laws such as the US Cloud Act, US authorities theoretically have access to data even if it is stored on servers in Europe. This is a systemic risk.

The Federal Ministry for Digital and State Modernisation (BMDS) is therefore redefining sovereignty – specifically through the location of value creation. It is no longer enough to use US software with German terms and conditions. As long as administrative control over the cloud infrastructure remains abroad, sovereignty is merely borrowed. True independence only arises when processes are technically immune to external access.

CPT 2026: a wake-up call for Europe

The fact that we need to act urgently on the issue of sovereignty was demonstrated by CPT 2026 (Connect. Protect. Transform.) at the beginning of March at the Allianz Arena. Nearly 500 experts and decision-makers formulated a clear goal: we must become technologically independent.

This is about much more than technology – it is about social responsibility. BSI President Claudia Plattner, for example, emphasised in her keynote:

The protection of our society depends on our digital capabilities – and on how well we can defend the digital space. We must strengthen the European digital industry and secure non-European products with technical control layers in such a way that self-determined use becomes possible.

Dr Fabian Mehring, Bavarian State Minister for Digital Affairs, also warned that we must wake up from our "digital slumber". He called for genuine freedom of choice: companies must be able to consciously opt for high-performance European solutions instead of merely playing by the rules of others.

The gap between theory and practice

Although experts have a clear vision, the reality in many businesses still looks different. Current reports (e.g. from Schwarz Digits) show that many companies rate their situation too positively: almost one in two companies, for example, underestimates its NIS2 obligations. Particularly risky: 92 per cent of high-turnover SMEs mistakenly believe they are not affected. Furthermore, 75 per cent of firms dispense with regular audits of their partners. In doing so, they risk weeks of business interruption due to incidents in the supply chain.

The FTAPI Secure Data Report 2025 underlines this critical status quo:

• For 24 per cent of businesses, daily operations would come to an immediate standstill without secure data exchange. 67 per cent would nevertheless resort to insecure alternatives in an emergency.

• Over 40 per cent of companies that rate their own security as high do not have a documented ISMS (Information Security Management System).

Areas of action: the path to digital independence

The question is: how can this gap be closed? A sovereign strategy is based on three fundamental pillars:

• Software ‘made in Europe’: Sovereignty requires control over the source code within the European legal area. It ends where maintenance access is operated from third countries. This is because such access allows foreign laws to intervene directly in European infrastructures.

• ‘Sovereignty by design’: Technology beats contracts. Continuous end-to-end encryption makes data access impossible for third parties – regardless of what a cloud provider promises legally. This effectively protects against espionage and unauthorised access.

• Avoiding ‘vendor lock-in’: Sovereignty means not binding oneself to insecure or technologically closed systems. True independence requires open interfaces (APIs) and standardised processes. This ensures that organisations’ security solutions interact seamlessly with existing IT infrastructure instead of creating isolated ‘black boxes’ that make accessing one’s own data more difficult.

Implementation in companies: what needs to be done now

To use sovereignty as a competitive advantage, organisations must shift their focus from purely reactive measures to a proactive strategy. The following steps help to regain control step by step:

• Establish security culture as a management task: Cybersecurity is a strategic issue, not just an IT project. Embed IT security as a fixed component in your annual reports and quarterly planning. The goal is to distribute responsibilities so that cybersecurity is understood as the basis for secure digital business processes.

• Visualise and assess data flows: Create a clear mapping of your sensitive data streams. Identify which information leaves the organisation and where it is stored. Such an audit uncovers dangerous shadow IT – for instance, when employees resort to insecure free tools out of convenience. This transparency allows targeted protective measures, such as encryption, to be applied where they are most urgently needed.

• Utilise automation purposefully: Automate processes to minimise human error. Modern systems can classify data independently and select the appropriate, secure dispatch route. This reduces the burden on your specialists and guarantees that compliance requirements are met without manual overhead.

• Rely on European partners: When selecting new software, check the legal background alongside the features. Enquire specifically about the provider’s headquarters and administrative access. True sovereignty requires partners who have built technological control and European data protection values (sovereignty by design) into their architecture.

• Grow with standards: Use frameworks such as the BSI standard C5 or ISO 27001 as a strategic roadmap. These certifications are much more than just paperwork – they signal to your customers and global partners that your processes are transparent and resilient to crises.

Regaining control with FTAPI

FTAPI closes the gap between strategic aspiration and daily operational life. Our platform provides the technical protection layer that enables companies to use state-of-the-art cloud benefits without surrendering sovereignty to third countries. It provides infrastructures for sensitive data exchange that are physically and logically anchored in Europe.

• Maintain data sovereignty: Through integrated encryption, the zero-knowledge principle, and automated processes, control over sensitive data streams remains with you at all times.

• Prevent shadow IT: Complexity quickly leads to risky makeshift solutions. That is why FTAPI focuses on intuitive usability, making security a habit in everyday work.

• Guarantee legal certainty: Operation exclusively on German servers safeguards your data sovereignty and protects against unwanted access by third countries.

Conclusion: the transformation begins now

Digital sovereignty is not a static state, but a process. Those who invest in their independence today secure their entrepreneurial freedom for the future. Awakening from our "digital slumber" is the prerequisite for a strong Europe.