2025-12-24 01:55:51
When we asked our fellows to spread around the globe to name the single most important technology development in the past year, the overwhelming answer was the rise of AI. Quantum computing, fusion, and batteries also made the grade.
On the policy front, Europe woke up to the danger of overregulation, while the US amplified its attacks on European rules. Despite few areas of convergence, common concerns emerged about protecting children and the best way to meet China’s tech challenge.
The following contributions have been edited for length and clarity:
This year brought us an unexpected story in European tech policy: “Sovereignty Strikes Back.” It began with the arrival to power of a right-of-center, pro-American European Commission. French Commissioner Thierry Breton was gone, and his “digital sovereignty” agenda looked set to vanish with his departure. Instead, it has returned with a vengeance. Europeans of all political stripes promote Digital Sovereignty. But there is no agreed-upon definition. Many see digital sovereignty as building up European tech capabilities. For others, it is a rallying cry for replacing everything that is not made in Europe. The cost of change would be enormous. Expect the coming year to be full of new Digital Sovereignty debates.
If 2025 is going to be remembered in the history of technology, it won’t be because of some shiny new gadget, but because this was the year when AI finally asserted itself as the structural engine of the economy and society. The big platforms released models capable of tackling complex tasks. Within three to five years, today’s AI models will inevitably be replaced by systems that learn like children do: by observing, interacting, predicting, and continuously updating an internal model of reality — systems that don’t just stitch together patterns, but actually build meaning from experience.
In 2025, the most important tech development was the industrialization of AI. While advances in model capability were steady rather than dramatic, investment in data centers, energy systems, and supply chains surged. AI began to look more like heavy industry. The defining question of the year was no longer how powerful AI could become, but who controls the infrastructure it depends on, who pays for it, and on whose terms this expansion continues.
In 2025, AI shifted from novelty to infrastructure. The result is a structural change in cybersecurity risk. Deep integration across enterprise software and cloud environments expands the attack surface. A compromise no longer hits a single application — it can cascade across the chain. Decades ago, cybersecurity was framed as a software problem, and more recently as a human one. Now, the defining challenge will be the security of the connections.
2025 will be remembered as the year that quantum computing and AI moved from theory into practice. Companies demonstrated practical quantum advantage in real-world applications, with Google’s Quantum Echoes algorithm operating roughly 13,000 times faster than traditional supercomputers. At the same time, enterprises began deploying autonomous AI agents capable of executing complex, multi-step tasks with minimal supervision.
On the policy front, the US reversal of advanced chip export controls toward China arrived too late to reshape the competitive landscape, landing at a moment when Beijing had already accelerated its own semiconductor capabilities and shifted decisively toward domestic suppliers. Chinese regulators rejected the newly permitted American hardware in favor of reinforcing growing self-reliance and domestic alternatives.
Sodium‑ion batteries deserve recognition as 2025’s most significant green technology. They give European and US households a realistic path to energy sovereignty, breaking dependence on Russian and Iranian hydrocarbons and Chinese lithium supply chains. In my hometown of Cambridge in the UK, for example, a typical home can now install a 4.5 kWh scalable sodium‑ion battery from local startup Eleven Energy. The battery charges when wholesale prices are driven towards zero overnight by high wind output and displaces gas‑fired generation when demand peaks. It’s a textbook case of how targeted technology deployment can reduce authoritarian influence over democratic energy and digital infrastructure.
China’s restrictions on exports of rare earths in 2025 sent shockwaves through boardrooms and capitals. The restrictions led to supply shortages of permanent magnets and critical components, forcing some factories to close. The episode showed that Beijing has developed powerful policy levers in its technology and trade confrontation with Washington, and that it is willing to use them. China is home to most of the technology and know-how needed to separate, purify, and shape elements like terbium and dysprosium into products used in everything from cars to datacenters to military drones. The repercussions will reverberate into the next year, as the US and its partners invest billions of dollars and pursue new private-sector partnerships to diversify supply, while companies scramble to gain visibility into supply chains and policy risks.
My favorite tech development of 2025 comes from France, where the start-up Altrove could provide a pivotal protection against China’s attempt to blackmail Europe and the US through their quasi-monopoly of rare earths processing. The company produces AI-designed alternatives for critical inorganic materials and promises to scale up production to a relevant level within two years. More efficient use of rare earth or serious recycling efforts of such raw materials will also have to play a role, but if Altrove is successful, it would be a leap forward in reducing the reliance on China.
In 2025, Australia implemented one of the first social media age-restriction rules, which is now being closely watched by other liberal democratic nations. At the same time, age-verification rules proliferated in the US, and an important Supreme Court ruling in Free Speech Coalition v. Paxton restricted access to online pornography. More than 20 states now require age verification. Expect additional age restrictions to be imposed around the globe in the coming years, especially around AI and children. These developments signal a tightening of rules around technology that have been held loosely for a generation.
For me, an American living and working in Europe, it has been painful to watch transatlantic relations plunge into the abyss, and one of the major causes of conflict has become technology policy. The US and Europe long stood shoulder to shoulder to push back against Chinese, Russian, and other authoritarian attempts to “censor” the Internet. No longer. The US now seems to see Europe as a bigger threat to Internet freedom than the authoritarians.
The much-overlooked debate at the United Nations over Internet governance achieved a surprising positive outcome. Authoritarian attempts to clamp down on Internet freedom were rebuffed. Instead, bottom-up multistakeholder governance, giving civil society and companies a voice alongside governments, emerged victorious. This shared decision-making has been critical to the Internet’s success. The UN’s Internet Governance Forum (IGF) was made permanent.
In a major realignment, the US pivoted to a pro-innovation agenda that positioned AI as central to economic competitiveness and strategic rivalry with China. Washington prioritized AI infrastructure, boosting federal support for data center development, streamlining permitting for high-capacity energy infrastructure, and imposing new export financing tools for AI-related technologies. Private investment aligned with this agenda, announcing a $500 billion Stargate initiative to build data centers. The largest cloud providers and frontier model developers signed multibillion-dollar deals. Internationally, this policy turn did not produce convergence, as US officials increasingly criticized heavy-handed AI regulation abroad, while European governments accelerated investment in domestic AI capacity to reduce reliance on American firms.
The Baltic countries, so long seen by Moscow as vulnerabilities to exploit, are now NATO’s frontline defense‑tech sandbox. Latvia has stopped thinking of itself as just a consumer of foreign kit and started acting as an innovation hub: hosting NATO’s largest ‘Digital Backbone’ experiment to harden command‑and‑control against mass drones, co‑building a Baltic ‘drone wall’ with AI‑enabled systems born on the Ukrainian battlefield, and locking in a path toward 5% of GDP defense over the next decade. Latvian companies are no longer only buying deterrence from abroad – they are exporting it.
President Trump gave the AI sector rocket fuel; he appointed tech investor David Sacks as AI and Crypto Czar, loosened chip export controls to China, and issued an executive order to preempt any state-level AI regulation. NVIDIA stock jumped 32% year-to-date due to the expectation of expanded market access, and Google Cloud revenue grew by 34%, driven by AI search demand. The Trump administration’s top priority is American economic dominance, and tech policy was the focal point for the President’s economic agenda in 2025.
Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions expressed on Bandwidth are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
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2025-12-23 01:08:25
This year, Europe and the US finally awoke to face reality: the post-Cold War world has ended.
Nearly four years ago, Russia’s unprovoked, full-scale invasion of Ukraine rattled the foundations of world order. In 2025, the US administration moved swiftly to rebalance and reshape international security, trade, and technology policy — with Europe beginning to take responsibility for its own defense — and decision-makers on both sides of the Atlantic are charting new courses to navigate geopolitical change.
Despite these shifts, this year has seen significant wins for the transatlantic alliance.
The 2025 NATO Summit in The Hague re-energized the alliance with a historic commitment from members to spend 5% of GDP on defense investments. The US and Europe are also prioritizing economic security, looking to invest in supply chains crucial to emerging technologies and defense production. The tech race intensified as the Trump administration took serious steps to unleash US innovation after China’s reveal of DeepSeek, an AI model capable of competing with US models on a global scale, surprised many leaders. At the same time, Europe began to advance reforms aimed at boosting its global competitiveness.
As in early 2022, predictions of Ukraine’s imminent collapse proved premature. Ukrainians are still holding the line on the battlefield as rounds of negotiations to end the war continue. No one wants peace more than Ukraine. Ukraine’s innovation in defense tech continues to push the envelope on defining the character of war, and there are many lessons Europe and the US should learn from the country’s experience. It is crucial to ensure this technology does not fall into Russian and Chinese hands.
To be sure, this year also saw some tension in the US-Europe relationship. But as Washington and its partners and allies across the globe learn to navigate in this new world, there is still a lot to play for. Transatlantic trade underpins the largest economic bloc in the world, with over $1.3 trillion in goods and services are exchanged across the Atlantic annually. Together, the US and Europe are a defense and economic juggernaut; neither can go at it alone as China and Russia seek to end US global preeminence.
This year has been one of growth and impact for CEPA. Our world-class experts were regularly called to testify before the US Congress and European Parliament; they authored over 30 in-depth reports and 600 articles while providing 20,000 quotes and citations for major media outlets, and joined in hundreds of events on both sides of the Atlantic. We also launched the CEPA Podcast that features interviews with Members of Congress and other high-level officials. All this activity reinforces the foundations of the transatlantic alliance.
This year, CEPA has delivered concrete and actionable solutions to the most urgent challenges facing the alliance. CEPA’s pillars of work at the intersection of technology and security addressed the top-of-mind issues for policymakers over the last year, from our groundbreaking work on deterring Russian shadow war, to our roadmap for a positive US-Europe tech agenda, and the future of autonomous and uncrewed systems.
We wrapped up the year with a celebration of our 20th Anniversary with the Leadership Awards Dinner where we honored impact-makers and leaders including Howard G. Buffett, Chairman and CEO of the Howard G. Buffett Foundation; Brian Moynihan, Chair and CEO of Bank of America; H.E. Ulf Kristersson, Prime Minister of Sweden; Gen. Chris Cavoli, former Supreme Allied Commander Europe and Commander of US European Command, and Ukrainian journalists risking their lives to document Russian war crimes in Ukraine.
As we enter 2026, CEPA will continue to advance our founding mission of ensuring a strong and democratic transatlantic alliance for future generations by expanding our networks across the political spectrum and providing cutting-edge expert analysis, actionable policy solutions, and impactful content to explain an increasingly complex world.
As a final reflection on CEPA’s work in 2025, I wanted to share a selection of agenda-setting ideas and analysis from CEPA’s experts that I found particularly thought-provoking, and I hope you will too.
Dr. Alina Polyakova is President and CEO of the Center for European Policy Analysis (CEPA) as well as the Donald Marron Senior Fellow at the Henry A. Kissinger Center for Global Affairs at the Johns Hopkins University’s School of Advanced International Studies (SAIS).
CEPA is a nonpartisan, nonprofit, public policy institution. All opinions expressed are those of the author(s) alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
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2025-12-23 00:24:08
This holiday season may be one of the most political celebrations of recent decades for many Hungarians. The rise of Péter Magyar, the first credible challenger to Viktor Orbán’s 16-year rule, will surely be on everyone’s lips as families gather to enjoy fisherman’s soup, stuffed cabbage, and poppy-seed bejgli. One issue in particular is guaranteed to dominate conversations.
Hungary’s child abuse scandal has cut across the political divide, with the government’s voters as outraged as opposition supporters. Not only does it threaten the administration’s standing just four months before elections, but it plays to the strengths of its main challenger. At least one December survey showed a sharp widening in the opposition’s poll lead.
Child protection has become Magyar’s signature issue. Not only was his political prominence triggered by last year’s presidential pardon scandal that involved pedophilia, but he has since used every opportunity to raise awareness of a corrupted system, stemming from negligence, misuse of power, and political cover-ups. These concerns, dating back years, include cases of abuse against children in state care and juvenile detention facilities. The latest, the so-called “Szőlő Street affair” from a juvenile detention center in the capital, has created a severe political and social backlash.
In this case, allegations of sex trafficking and forced labor, along with verbal, physical, and sexual abuse, have been reported. Graphic videos have circulated on social media showing employees, including heads of the facility, subjecting children to inhumane treatment as “discipline”.
These cases are not isolated, the material suggests, but many victims are afraid to speak out because of allegations that the affair reaches close to Orbán’s inner circle. Deputy Prime Minister Zsolt Semjén was accused of involvement in a child sexual abuse scandal. Semjén denies this, while Orbán has called the abuse both criminal and unacceptable.
The latest allegations prompted tens of thousands of protesters to march across Budapest’s iconic Chain Bridge behind a banner proclaiming “Protect the Children.” They gathered outside the Sándor Palace, the official residence of the president, which is located right next to Orbán’s office. Magyar has promised legal and political accountability, along with deeper investigations into child protection cases. He argues that these incidents are not isolated but part of a corrupt system that the government has long been aware of and has continually helped cover up.
The government’s response has been to deny most of the claims, although it has also placed a number of child institutions under police oversight. Pro-government media have suggested that Britain’s MI6 is somehow linked to the scandal.
For a government that prides itself on being family-friendly and on protecting children from Western ideological threats such as gender identity and LGBT ideas, these scandals strike a sensitive nerve. They stand in stark contrast to the billboards at Budapest’s international airport, informing visitors in multiple languages that they have just arrived in “Family Friendly Hungary.”
Child protection, particularly these recent scandals, is dividing Orbán’s electorate and benefiting Magyar, who has waged a savvy campaign to attract disillusioned voters from the prime minister’s camp. A recent poll by the 21 Research Center, a Hungarian survey company, found that more than half of Orbán’s supporters are “strongly critical” of the government’s response and communication regarding the child abuse scandals.
This theme visibly drives a wedge into Fidesz’s voter base and, if more evidence or scandals emerge, could further solidify Magyar’s lead ahead of the parliamentary elections in April. It is thus no wonder that child protection has become such a key theme for Magyar. From organizing large-scale protests and launching a child protection hotline to bringing Christmas gifts to childcare services, children’s hospitals, and orphanages, this issue clearly transcends existing party preferences.
Magyar has maintained this focus, and it appears to be one of his strongest cards in drawing voters away from Orbán. The challenge, however, is that undecided voters or those unwilling to state their preference still make up at least one-third of the electorate. There is also a long history of opposition parties that are flattered in the polls, eventually falling at the electoral fence.
This Christmas brings politics into Hungarian households, as different generations spend time together. Whatever the discussions and arguments at festive family dinner tables this year, one thing is likely to unify Magyar’s younger voters and Orbán’s older supporters — that the child abuse scandal is severe, and that the government has so far failed to find a convincing response.
Ferenc Németh is a Ph.D. candidate at Corvinus University of Budapest. He has previously conducted research on the Western Balkans in Toronto and Skopje, worked as a research fellow at the Hungarian Institute of International Affairs, and interned at EULEX Kosovo. His areas of expertise include the Western Balkans, EU enlargement, and regional security. Ferenc was a Denton Fellow at CEPA in 2024.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions expressed on Europe’s Edge are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
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2025-12-20 01:57:26
When Europe put in place the world’s strictest rules on Internet privacy in 2018, the General Data Privacy Regulation, known as the GDPR, spread around the globe and became a gold standard for protecting personal data. In comparison, the US has no federal data protection law.
Today, Europe’s new emphasis is on clearing away overregulation and spurring competitiveness. Its recently proposed Digital Omnibus includes a haircut to GDPR. Rather than treating nearly all data-related activity as a privacy issue, the revisions attempt to separate harmless data processing from true privacy harm.
The reforms have triggered familiar reactions. Industry calls it overdue relief. Civil society derides them as a dangerous rollback. The European Commission insists they represent simplification, not deregulation, and points to an estimated €5 billion in reduced compliance costs by 2029.
GDPR governs data processing, and data processing is everywhere. Payroll systems, customer support logs, spam filters, authentication tokens, billing records, fraud detection, security monitoring — the daily mechanics of a digital economy.
Privacy harms are different. They arise from specific dangerous practices such as surveillance, profiling, behavioral manipulation, biometric identification, and location tracking.
The proposed reforms separate the two categories. They do so in limited but deliberate ways, by easing some requirements where data use is low-risk and technical, without touching the core rules that apply to tracking, profiling, or decisions about people. Companies would still have to act responsibly and transparently, but some routine operations would no longer automatically trigger the heaviest privacy protections.
That means less pressure to treat every technical activity as a consent event, and fewer ritual consent requests for tasks that do not raise genuine privacy concerns but currently absorb a disproportionate share of red tape. Much of GDPR compliance has become less about solving genuine privacy problems than about pushing paper.
Consider cookies. Whenever a European navigates to a website, a cookie banner appears. To clear the screen, users click Accept All. Consent fatigue does not represent a meaningful choice.
The reforms would take a first step toward reducing the endless banner treadmill. Privacy advocates who complain about weak enforcement of GDPR treat any reduction in consent friction as suspect, as if the banner ritual itself represented the core of privacy protection.
One of the most sensitive changes concerns how the law decides when data counts as “personal.” Under the GDPR, data is protected if it can be linked to a person — but the rules have never been clear. In practice, almost any data can be treated as personal if someone, somewhere, could theoretically identify an individual.
This stretch has pulled a vast amount of routine technical information into the GDPR. The proposed reforms narrow that uncertainty by asking a simpler, more practical question: can the company actually use the data it holds to identify a real person? If not, the data would no longer automatically trigger the full weight of privacy rules.
For the largest tech companies, these changes are unlikely to feel dramatic. They already have teams, processes, and workarounds in place. The reform may remove some paperwork and clarify a few grey areas, but it does not rewrite the rules of the game. In practice, this means adjustment rather than transformation — incremental change.
The reform will not make the pop-ups, notices, and paperwork disappear overnight. Many of the forces that generate them remain, and exceptions and carve-outs limit how far simplification can go. Companies will still find ways to ask for consent, and users will still be asked to click through notices – even if fewer of them. The package trims the edges without a real redesign.
Europe will not fix its competitiveness problem by trimming compliance costs around cookie clicks. But the reform matters. It nudges Europe in the right direction. For the first time, Europe admits that data processing is not synonymous with privacy harm.
Dr. Anda Bologa is a Senior Researcher with the Tech Policy Program at the Center for European Policy Analysis (CEPA).
Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions expressed on Bandwidth are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
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2025-12-20 01:38:33
The European Union walked to the chasm’s lip on December 19, peered over, and then stepped back a pace. But any relief at its decision to extend a financial lifeline to Kyiv was soured by the knowledge that financing the war will now be funded by European taxpayers rather than the Russian dictatorship.
It finally agreed on a new €90bn ($105bn) of bonds to cover a large chunk of Ukraine’s €140bn financing gap for the next two years. The hope is that other members of the coalition of the willing, like the UK and Japan, will make up the shortfall. The US is not expected to contribute.
That should send a message to Putin that Ukraine is sufficiently well-funded. It will allow Ukraine to maintain its defenses and fend off Russian aggression. Putin could be heard gnashing his teeth on this and other matters at a year-end press conference in Moscow on December 20.
But while the EU did the right thing (a failure would have led to Ukrainian defeat), it did so in the worst available way. The bloc failed to secure agreement on what should be the morally justified course of action — by making Russia pay.
The bloc and the UK have more than $250bn in Central Bank of Russia (CBR) assets. But the plan to fund Ukraine from CBR assets via a reparation loan — only to be repaid once Russia pays reparations to Ukraine — was ditched.
Actually, the reparation loan itself was a compromise and did not really make Russia pay, as the underlying assets were not to be seized, but simply repurposed for the use of Ukraine. Russian and Western business interests had long lobbied against seizure. So did countries with a friendly view of the Kremlin, and some with ties to the Trump administration, which opposed the idea.
Belgium played a notably ignoble role. It was the target of an intensive Russian intelligence operation to frighten its bankers and government ministers. This had a clear impact. Belgium’s Prime Minister said Russians had told him that using the money would mean, “Belgium, and I personally, will feel the effects for eternity.”
The country houses the bulk of Russia’s frozen assets in the EU, through Euroclear. It pulled out all the stops to defend its business interests — first arguing that using CBR assets to support Ukraine was illegal, then that the issue would damage confidence in the euro, and latterly that it would risk retaliatory action against private Western assets now stranded in Russia.
After weeks of discussion, it has become clear that the legal arguments against the reparation loan were weak, even though this route did not envisage seizure, even if this would be morally right, politically correct, and legally justified under the countermeasures defense.
There is a reason why Russia has not taken legal action in Western jurisdictions since immobilization almost four years ago — any suit would remove its sovereign immunity and open it to Ukrainian counter-suits of up to a trillion dollars. Would courts really put the financial interests of a kleptocratic dictatorship above those of the millions of Ukrainians whose country has been hammered in a war of imperial conquest? Perhaps, but Russia has been notably unwilling to take that risk.
Russia has been no keener to invoke bilateral investment treaties, as they relate only to private sector investments, not sovereign assets. The CBR lodged legal action in the Russian courts since this was its only option. But it lacks jurisdiction or enforcement power in Europe. The legal risks cited by Belgium and its friends were mostly scaremongering.
Similarly, the risks to euro reserve status were overstated, and indeed, the euro has moved barely at all during the Russian asset discussions. Large reserve owners have little option but to invest in G7 jurisdictions; there are simply no large alternative markets.
In the end, I think what swung the pendulum against the reparation loan and the use of immobilized CBR assets to support Ukraine was intensive lobbying by Western business interests who feared retaliatory action by Moscow. This is remarkable and disappointing for numerous reasons.
First, Putin has already been confiscating Western assets pre-emptively. So a move against CBR assets would be fair retaliation by the EU.
Second, CBR assets held in G7 jurisdictions dwarf by multiples those now stranded in Russia, and not already written off by the owners.
Third, owners of assets stranded in Russia made bad investment calls. They long could have concluded that Russia was a bad actor capable of mass theft reminiscent of the Bolshevik regime after 1917. That was the lesson of numerous events — Russia’s invasion of Georgia in 2008, the annexation of Crimea in 2014, and then the first Russian invasion of Donbas in 2014, the use of weapons of mass destruction twice by Russia on NATO soil, in London and Salisbury.
And if all that were not enough, US and British intelligence agencies gave early warning, in public in 2021, stating that the full-scale invasion was imminent. These Western businesses could have exited Russia long before the invasion, but chose to stay as they liked the windfall profits they were earning.
But let’s understand this: if immobilized CBR assets are not being used to fund Ukraine so as to protect Western business interests still in Russia, then Western taxpayers will have to pick up the tab instead. Ordinary European citizens will fund the new €90bn EU borrowing facility.
That means Western taxpayers are again bailing out greedy Western businesses that made bad investment decisions. This is a clear moral hazard play on several levels, not least by signaling that it pays to do business with Putin. What a dreadful message for Western governments to send.
Fourth, it implies that Western national security interests are being held subordinate to the business interests of a few greedy Western investors.
Profit is being placed before national security. And the Western taxpayer is being ripped off again because our politicians are again putting the interests of their populations behind those of well-connected special interests.
Timothy Ash is a Senior Emerging Markets Sovereign Strategist at RBC BlueBay Asset Management. He is an Associate Fellow at Chatham House on their Russia and Eurasian program.
The views expressed here are his own.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions expressed on Europe’s Edge are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
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2025-12-19 18:11:02
The fleet, hundreds of ships strong, enables Moscow to circumvent curbs on oil sales and engage in sabotage, particularly in the Baltic, posing security, environmental, and economic challenges for Europe. So far, the continent’s response has been anemic.
The shadow fleet holds significant strategic value beyond oil transfers. Writing in Foreign Affairs, CEPA senior fellows Irina Borogan and Andrei Soldatov warned that the vessels provide both effective cover for Russian agents and convenient launch platforms for drones. The ships stand accused of involvement in drone launches to disrupt Danish airspace and internet cable-cutting operations in the Baltic Sea.
Russian intelligence has a long history of using civilian vessels for espionage, dating back to early Soviet times, and the Kremlin has invested significant resources and deployed military heavyweights to revive seaborne sabotage. These include Admiral Igor Kostyukov and Nikolai Patrushev, a former head of the Security Council and FSB.
Lea Allonier, co-founder of the Copenhagen-based Dark Waters project, which tracks Russian shadow fleet ships, says there are two core ways to examine the shadow fleet: as an environmental or a geopolitical issue. The current framework is centered around the environmental and, as many of the fleet’s vessels are old, European navies and officials have been stopping them to find any breaches of environmental rules.
But this system does not provide many opportunities for action beyond those inspections, according to Allonier. European states may have to shift to prioritizing a geopolitical approach and start detaining vessels, even if it requires operating in a legal gray zone, she said.
Since Russia is operating in a gray zone by using these ships, European countries should respond accordingly, argues Tom Sharpe, a British defense commentator and former Royal Navy spokesman. Maritime laws, while imperfect, should be adhered to, and Europe must develop a coherent system to inspect ships suspected of sanctions-busting and use existing legal loopholes to detain them.
It would require leadership and the willingness of major European governments, such as Germany, France, and the UK, for such an initiative to work. Europe is moving towards this approach, but it still lacks a unified system.
Kyiv has employed its own strategy. In the first two weeks of December, Ukrainian forces struck at least three Russian tankers that had carried illegal oil in the Black Sea (all were empty at the time). But while that is legitimate for a country at war, it cannot be used by others.
Tackling unflagged ships and sanctions infringements requires a revision of UNCLOS, the international maritime legal framework, as the existing system leaves loopholes and gray areas in which Russia operates. But changing legal conventions will take years, and Russian drones and hybrid operations are threatening European countries now. Improving European security in the meantime requires enhanced cooperation.
Much information about vessels currently gathered by states is often classified, as it has military implications, and is not shared with other capitals, Sharpe says. This needs to change if an effective tracking mechanism is to be developed.
Some Russian ships will pass inspections and comply with new standards, but it is crucial to keep them all under surveillance as they may be used for sabotage. A unified system of data-sharing must be created so European states can work together to monitor the shadow fleet.
Allonier emphasized the importance of fast information transfer in the development of a new system. It should be designed to allow quick data sharing and minimize administrative hurdles, she said.
Such cooperation must extend to non-European states, such as Panama or Cameroon, under whose flags the shadow fleet operates. It should also include non-military entities with the capacity to collect intelligence at sea, such as pilotage associations, coastguards, search and rescue, banks, insurance companies, shipping companies, and NGOs.
The shadow fleet could also offer an opportunity for the UK, in particular, to step up its engagement. While its defense sector has been underfunded for decades, the threat of hybrid warfare should push London to invest more in naval security. Notably, its maritime insurance market is very large, and it also leads the 10-nation Joint Expeditionary Force (JEF) whose members are concentrated in the Baltic region.
The UK is currently investing a large part of its defense budget in new nuclear missile-armed submarines and has little money left for other areas. But if it truly seeks military leadership in Europe, it needs to offer a more active role. The UK is less open to the threats and intimidation that Russia aims at the smaller Nordic-Baltic countries, and which have succeeded in heading off tougher action against the shadow fleet (see this CEPA article) and the Kremlin’s accelerating shadow war.
There are positive signs, including a much closer British defense relationship with Norway, which will include a £10bn ($13bn) program to build five frigates for the Norwegian navy and joint operations with the Royal Navy. Future warship orders from Denmark and Sweden are also possible.
It is true that the shadow fleet presents one of the most complex dilemmas in the hybrid confrontation between Russia and Europe. While there is no universal or straightforward answer, Europe needs to respond to Russia’s provocations since appeals to international law have failed.
Better intelligence and data sharing must be involved, and ships carefully inspected and tracked. Ultimately, when Russia goes too far — as it very likely will — the northern European democracies must be ready to use military force to check Russian lawlessness.
Mykyta (Nikita) Vorobiov is a political analyst and a Master`s student at the University of Oxford, pursuing an MSc in Russian and Eastern European Studies. He holds a BA in Ethics and Politics from Bard College Berlin, where he conducted extensive research on Russian visual propaganda. For the last four years, Nikita has been publishing articles on politics and law for CEPA, VoxEurop, JURIST, and others.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions expressed on Europe’s Edge are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
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