European data troubles—and why the upcoming EU Data Union strategy matters

European data-driven startups and scale-ups still struggle to access data from state-owned and private companies, limiting their ability to scale, let alone compete globally. The interplay between the GDPR, Data Act, Data Governance Act, Open Data Directive, AI Act, and various sectoral industry action plans is complex and remains difficult to navigate for most.

Building a coherent data economy model that promotes economic growth while aligning with the EU's strict data protection framework is, of course, no easy task. The challenges range from technical and interoperability issues to incentivizing private actors to share their data and urging Member States' administrations to accelerate data openness.

EU Data Union Strategy - a window of opportunity to simplify

The European Commission is aware of the challenges: in her mission letter to Henna Virkkunen, Ursula von der Leyen outlined the need for a EU Data Union Strategy, with a strong focus on “large foreign tech companies.”

The Commission states that the goal of the EU Data Union Strategy is to create "a simplified, coherent legal framework for businesses and administrations to share data seamlessly and at scale".

As European data-based companies eagerly await a consultation on the EU Data Union Strategy (which is promised to be launched in 2025 Q1), it is crucial to highlight the structural issues for data sharing within Europe.

The current framework needs to be simplified, better explained, and supported with adequate resources for Member States to ensure smoother implementation. European data-based companies must also be active in highlighting the practical challenges they face in accessing data.

While the EU data economy model is being implemented in phases, the current framework creates a heavy administrative burden on both public administrations and businesses.

The EU Data Union Strategy, aligned with the European Commission's simplification efforts, presents a chance to streamline processes and improve data sharing. However, political will, industry involvement, and a sharp focus on persistent issues (including the scope of personal data under the GDPR will be needed.

The state of open-data ambition in Europe

Open data is state-owned data that the public sector may share for businesses and researchers. Despite growing demand, EU public institutions remain inconsistent in its availability.

The EU has already funded the European Data Portal, a pan-European repository of public sector information open for reuse, which essentially aims to provide a single access point in all 24 EU official languages for data published by public administrations at all levels of government.

In 2019, the EU adopted the Open Data Directive, which was followed by Member States drafting their Open data strategies and creating Open Data Portals.

The EU has also been analyzing Open Data Maturity via a specialized Index. The 2024 Index results show that the leaders in Open Data Maturity are France (100% maturity), Poland (98%), Ukraine (97%), Slovakia (96%), Spain and Ireland (95%), Estonia, Latvia, Cyprus, Czech Republic, and Italy (94%). Europe’s industrial powerhouse, Germany scores at only 75%.

B2G, B2B, and B2C data-sharing labyrinth

In 2023, the EU adopted the Data Act, regulating business-to-business (B2B), business-to-government (B2G), and business-to-consumer (B2C) data sharing. It aims to ensure fair access and use of data, particularly non-personal industrial data—stress on 'non-personal', which leaves many European data-based businesses with very little room to maneuver within the scope of the GDPR.

The Data Governance Act, enforced since September 2023, creates legal frameworks to facilitate voluntary and trust-based data sharing, enables data intermediaries, common European data spaces, and creates a data governance system for Member States.

Creating a data economy model for the EU is being implemented in phases, but the current framework imposes a significant administrative burden on both public administrations and the private sector.

The EU Data Union Strategy, in line with the European Commission's simplification efforts, presents a window of opportunity to streamline processes and enable smoother data sharing. However, both political will and industry involvement will be essential to make this a reality, as is laser-sharp focus on the biggest issues that have been visible in previous initiatives.

Issues to be solved

1. Financial incentives to open data for public institutions to avoid 'open data theatre'. Some institutions, such as centralized registries, charge for access to public data (f.e. real estate, business registries, mapping services), creating a significant financial disincentive to open data. In some cases, these registries and other public institutions choose to open only the least valuable datasets, meeting KPIs without driving the real change needed for a thriving data economy. No Member State's open data ambitions should be taken seriously if their budgets do not include incentives to offset lost revenue for such state-owned companies, at least temporarily (see: Latvian example). Perhaps the EU should consider this when planning the next financial perspective.
2. The scope of personal data under the GDPR needs to be reviewed. While much has been done and promised through the Data Act, Data Governance Act, Open Data Directive, and other initiatives, the core issue remains—the GDPR’s strict scope of personal data and consent requirements either serve as justification for companies' non-altruistic approach to data sharing or simply discourage participation in data-sharing initiatives in fear of GDPR infringements. As a result, while the EU pushes for a thriving data-driven economy, companies—especially startups and SMEs—struggle to access and utilize data efficiently. While the Commission's recent statements about the GDPR Simplification Omnibus sound promising, the focus should extend beyond just reporting requirements.
3. Limited incentives/imperatives for business to share their data. While the Data Act introduces new rules mandating fair B2B and B2G data sharing, many European companies remain hesitant, seeing data as a competitive asset. While European digital sovereignty advocates continue to push for mechanisms requiring large non-European companies to share data with academics and, eventually, European businesses, much remains to be done to encourage European companies to do the same. Voluntary mechanisms are clearly not enough.