Sovereignty Washing: The Difference Between a Label and a Foundation
5-minute read
There is a new term doing the rounds in European tech circles: sovereignty washing. It describes a phenomenon everyone recognises but no one likes to name out loud. Servers in Frankfurt. An EU flag in the marketing deck. A European subsidiary as a legal shell. And a parent company in the United States that falls under the US CLOUD Act — meaning access can be demanded to every byte of data on those servers, wherever in the world they are.
It is not the first time the industry has turned a societal concern into a product. But it is one of the most costly variants. Because whoever buys sovereignty without acquiring ownership is buying a feeling. Not a guarantee. And certainly not continuity.
The anatomy of a sham
Sovereignty washing does not work by lying. It works by compensating.
By way of example: the assessment instruments currently being developed — the DICTU Cloud Services Sovereignty Assessment Tool and the European Cloud Sovereignty Framework — are serious steps forward. Both assess suppliers across multiple dimensions: jurisdiction, technology, operational management, data and people. But both share the same structural risk: a weighted total score. A large hyperscaler can score highly on open standards and EU infrastructure — and thereby mask a fundamentally low score on jurisdiction.
On that last criterion, there is no trick. Your parent company is in the US or it is not. You fall under the CLOUD Act or you do not. European packaging — EU staff, EU data centres, EU certification — earns points in a scoring model, while the code, the updates, the intellectual property and ultimate control remain American.
Ludo Baauw, co-founder of DEC-Alliance, observed this at close quarters during the Open Dialogues on the NDS Cloud held by the Dutch Ministry of the Interior (BZK). Sixty-nine market parties took part. Roughly a quarter were American — through ownership, headquarters or parent company. The government asked the market how we could become more independent of the market.
The answer was predictable: hybrid models, sovereign clouds alongside the public cloud of the very same parties that had just explained you cannot do without them. As Baauw put it succinctly: as long as the government accepts complete stacks in which hardware, platform, software and identity management all come from a single party, every conversation about sovereignty is cosmetic. Without open architecture, open standards and open source — the three opens — you are not a customer. You are a hostage.
Three continuities that count
DEC-Alliance starts from a different premise — and it is not a new one. It has been built into the structure of the alliance from day one.
Digital autonomy is not a black-and-white question. Absolute independence is an illusion, and anyone who claims otherwise understands neither the technology nor the economics. The question is not whether you work with large international players. The question is who holds the key. Who can decide where workloads run, which data is shared, and what happens when the geopolitical wind changes.
That answer does not lie in technology. It lies in three forms of continuity that together determine whether digital autonomy is real or cosmetic.
Continuity in technology — infrastructure as a public good, not as a geopolitical instrument of power. Open standards, open architecture, and the ability to migrate without the permission of a foreign supplier. For standard functions, European alternatives already exist. It is less complex than it is made out to be.
Continuity in entrepreneurship — generational thinking over exit thinking. Vital mid-market tech companies that are not driven by the logic of short-term capital, but anchored in a circle of trust among peers. As Jan Bakker, CEO of Avisi, repeatedly points out: knowledge and expertise can be lost quickly when technology is outsourced or sold abroad. A plan B is not a luxury — it is a strategic obligation.
Continuity in ownership — evergreen capital instead of fleeting money. But also: golden shares that anchor control with local parties. Employee participation that makes engagement structural. Ecosystems in which selling shareholders reinvest part of their proceeds in the alliance. Ownership not as a legal construct, but as the living foundation of a local ecosystem.
Anyone who does not safeguard these three is — whatever the rhetoric — engaged in sovereignty washing.
A new asset class
For investors, this is more than a societal theme. It is an underestimated investment category.
The vital mid-market tech companies that DEC-Alliance brings together — the Hidden Gems of Europe's digital infrastructure — operate at the intersection of two powerful trends: the structural digitalisation of the economy and the growing societal urgency around ownership and continuity. That intersection creates an asset class with a combination of characteristics that is rarely found.
These companies have been around for a long time. They are deeply embedded in the supply chains of healthcare, government, education and financial services. They run on recurring revenue — as a structural foundation, not as a growth story. They are hard to replace and relatively insensitive to economic cycles.
At the same time, precisely because they are vital, they have long been overlooked by institutional capital focused on scale and speed. That creates a valuation gap — and an opportunity.
The DEC-Alliance model responds to this through an evergreen fund structure that puts continuity at its core. Because there is no exit pressure, capital can do its work: long-term compounding in companies with proven recurring revenue, without the value destruction that forced transactions bring. Liquidity is not an afterthought — it is given serious consideration — but it is the result of sound business management, not its driver. The expected annual returns of 10 to 15 per cent are therefore not based on speculative growth, but on the quiet strength of companies that have been indispensable for decades.
What is more, the more firmly ownership is anchored locally — through governance, golden shares and alliance agreements — the less vulnerable the investment is to the very risks that sovereignty washing exposes. Legal vulnerability through extraterritorial legislation. Strategic dependence on parties with divergent interests. Capital flows that leave the European economy through acquisitions.
What remains is an investment in companies that will still be here in ten years' time, still indispensable, and that will meanwhile have helped strengthen the digital backbone of the Netherlands and Europe. That this coincides with an attractive return is no coincidence — it is the structure.
Proof in practice
In early 2026, Baauw founded the Open Cloud Alliance from within Intermax Group — a coalition of seven Dutch cloud providers: Centric, Info Support, Intermax, KPN, Nebul, Previder and Uniserver. Together they operate more than 20 data centres, generate more than €2.5 billion in cloud revenue and employ more than 13,500 people.
Not a report. Not a position paper. A working structure, built on open standards, with agreements on what happens if a partner falls into non-European hands. Technically operational within weeks. Fully under Dutch and European jurisdiction.
This is the logic of DEC-Alliance in practice: not sovereignty as a label, but continuity as everyday action. The three opens as a hard requirement, not a preference. Ownership as a structural anchor, not a marketing promise.
There is a great deal of talk in The Hague and Brussels about digital sovereignty. DEC-Alliance is building it.
