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Friendly Competition or Strategic Cooperation: UK and France at a Tech Crossroads

Automation, digitisation, financial technology, artificial intelligence: every day a new headline from the ever-advancing world of technology signals another shift in the way business is conducted, and lives are organised. Within this tidal wave of change, the UK and France have positioned themselves as Europe’s premier locations for research, design, funding and market growth. 

This is underscored by the presence of huge companies like Revolut and Capgemini, and headline deals such as the recent UK-US tech agreement. Yet this strong position is not unassailable. Regulatory misalignment, global competition and political constraints now pose a real threat to the sector’s future, which is increasingly tied to defence, security and economic strength.

Compete or Lead Together? A strategic choice for Europe

These issues were at the heart of last month’s Franco-British Business Conference, which brought together leaders from academia, business and government. While the mood music around AI remains positive, the real challenge now is one of strategy: should Europe and the UK compete, or lead together? Pursuing isolationist paths risks eroding competitiveness, fragmenting shared markets, and weakening supply chains. Collaboration, not rivalry, will determine whether cross-Channel innovation can keep pace with the scale and speed of global technological change.

Rules of the Game: Regulation for Sovereignty

Regulation lies at the heart of this tension. The EU’s AI Act, designed to protect consumers and ensure a level playing field, risks becoming overly restrictive, creating new barriers for both large companies and start-ups. The UK, by contrast, has pursued a lighter, sector-specific approach to preserve room for innovation, yet continues to face challenges in attracting talent and funding when compared to the innovation-driven environment of the United States. The pursuit of a coherent global framework for AI remains uncertain, with UK–US dynamics still unresolved and the recent summit concluding without a joint communiqué. Sovereignty, meanwhile, remains a “double-edged sword”: essential for safeguarding data, supply chains, and national security, but potentially counterproductive if enforced too rigidly.

The Human Factor: Talent, Mobility and Competitiveness

One of the main obstacles to competitiveness and adaptability lies also in the limited mobility of researchers and tech leaders. The need for talent far outpaces the flexibility of work mobility, making it essential for governments to put borders back on the agenda. A dedicated “AI Visa” could help accelerate research collaboration and ease the movement of experts between innovation hubs. At the same time, clear and attractive career pathways are needed to prevent the loss of skilled workers to the US, where deeper capital markets and lighter regulation remain powerful draws. Europe’s appeal is still constrained by restrictive frameworks and persistent talent bottlenecks. However advanced AI becomes, people remain its lifeblood, and enabling them to move freely is vital to sustaining healthy, competitive ecosystems on both sides of the Channel and cross-Atlantic.

Beyond Regulation: The Case for Franco-British Collaboration

The task for policymakers is therefore urgent. Both governments must resist the temptation to “do it alone” and instead build a framework for Franco-British cooperation that is aligned with wider competitiveness and appetite within the European and North American markets. That means designing regulation that protects consumers without stifling innovation andinvesting in mobility schemes such as an AI Visa. Above all, it means ensuring that SMEs, which are so often the victims of talent shortages and regulatory friction, can receive targeted support to contribute knowledge, talent and resources so that they may grow.

Technology is now a strategic industry as vital to national security as it is to economic prosperity. The choice facing the UK and France is stark: isolation and potential stagnation, or cooperation and long-term competitiveness. The Chamber will continue to convene stakeholders, report on business concerns, and advocate solutions that promotes growth and job creation cross-Channel.