04 Aug EU Open Source Strategy: What the Tech Sovereignty Package Means for Choosing an HR System
Key Takeaways
- On 3 June 2026, the European Commission published the European Technological Sovereignty Package, which includes the EU Open Source Strategy (European Commission, 2026).
- The package commits €2 billion over 7 years to open source development and introduces a “Free Software first” principle for public procurement of cloud and AI software (European Commission, 2026).
- The EU states it relies on non-EU suppliers for over 80% of key digital products and services (European Commission, 2026).
- The “Free Software first” principle is currently an encouragement, not a legal mandate. The accompanying legislation (the Cloud and AI Development Act, the Chips Act 2.0) is still going through the European Parliament and Council legislative procedure (Belfer Center, 2026).
- The strategy targets 30 million active users of open source tools across the EU by 2030 (European Commission, 2026).
Introduction
The EU open source strategy is part of the European Technological Sovereignty Package, published by the European Commission on 3 June 2026. The document places open source software at the center of EU digital policy and signals a preference for open software in public procurement. For organizations choosing an HR system, this creates a new, formal argument for open source, though for now it remains an encouragement rather than a legal requirement.
What does the European Technological Sovereignty Package include?
The package has four components: two legislative proposals (the Cloud and AI Development Act and the Chips Act 2.0) and two non-legislative strategic documents (the EU Open Source Strategy and a Strategic Roadmap for Digitalisation and AI in Energy). The European Commission states that the EU relies on non-EU countries for over 80% of key digital products, services, infrastructure, and intellectual property (European Commission, 2026). The Open Source Strategy sets four objectives: developing European open source alternatives, supporting procurement guidance that favors open software, building a stronger open source ecosystem, and promoting European open source solutions internationally.
What is the “Free Software first” principle in public procurement?
The “Free Software first” principle means public institutions purchasing cloud or AI software should first check whether a suitable open source solution exists before choosing a closed alternative. It builds on the “Public Money, Public Code” principle previously promoted by the Free Software Foundation Europe. In practice, the Commission plans updated tender guidance, evaluation criteria, and support for the long-term maintenance of open source solutions in the public sector (European Commission, 2026).
Is the EU open source strategy already binding law?
No, and this distinction matters. The Open Source Strategy itself is a non-legislative document that the Commission has already published and adopted, but the two actual pieces of legislation in the package (the Cloud and AI Development Act and the Chips Act 2.0) are still moving through the ordinary legislative procedure in the European Parliament and the Council of the EU, where the text can still change (Bird & Bird, 2026). Within the strategy, and especially within CADA, public sector adoption of open source is encouraged rather than mandated, a softer approach than in earlier drafts (Belfer Center, 2026).
Why is the EU prioritizing open source software?
The Commission’s core argument is reducing strategic dependency on non-EU suppliers amid geopolitical and trade tensions. Open source software lets public institutions avoid vendor lock-in, independently audit source code, and keep data within European infrastructure. This matters especially for systems processing employee and candidate data, where control over data and the ability to audit how software makes decisions carry additional regulatory weight.
What does the EU open source strategy change for organizations choosing an HR system?
For organizations considering a new HR system, the strategy adds a formal argument for open source that is independent of licensing costs. Public sector buyers may increasingly encounter tender guidance favoring open software, while private companies watching this regulatory trend gain a signal about the direction of EU digital policy. An open source system like MintHCM already offers full access to its source code and self-hosting today, without waiting for CADA to be finalized.
Open source vs closed source HR software under the EU open source strategy
| Criterion | Closed source software | Open source software |
|---|---|---|
| Access to source code | None, code is owned by the vendor | Full, code can be audited and modified |
| Vendor lock-in | High, switching systems requires migration | Low, hosting or implementation partner can be changed |
| Alignment with “Free Software first” | Requires justification in public tenders | Naturally aligned with the strategy’s preference |
| Data control and hosting | Depends on vendor’s terms | Full self-hosting within the EU is possible |
| Licensing cost | License fees, often per user | No licensing fees for the code itself |
Frequently asked questions
What is the European Technological Sovereignty Package? It is a set of initiatives published by the European Commission on 3 June 2026, comprising two legislative proposals (CADA, Chips Act 2.0) and two strategic documents, including the EU Open Source Strategy (European Commission, 2026).
Is the “Free Software first” principle mandatory? No. It functions as an encouragement and preference in public procurement, not a legal mandate with a penalty for non-compliance (Belfer Center, 2026).
When will the EU open source strategy fully take effect? The strategy itself already exists as a published document. The accompanying legislation (CADA, Chips Act 2.0) is still in the legislative process and may still change before adoption.
How much funding is the EU committing to open source? €2 billion over 7 years, with a target of 30 million active open source users across the EU by 2030 (European Commission, 2026).
Does the strategy apply only to the public sector? It is formally directed mainly at public administration, but it signals a broader regulatory trend that private companies may also want to watch when choosing IT systems.
Is MintHCM already aligned with the “Free Software first” principle? As an open source system with available source code and self-hosting options, MintHCM already reflects the direction set out in the strategy, regardless of how quickly CADA moves through the legislative process.
How does the Open Source Strategy differ from the Cloud and AI Development Act? The Open Source Strategy is a non-legislative document that has already been published. CADA is a legislative proposal that still requires approval from the European Parliament and the Council of the EU.
Sources
- Strengthening Europe’s Tech Sovereignty. European Commission, 2026.
- The EU Open Source Strategy. European Commission, 2026.
- Tech Sovereignty Package an overview. Bird & Bird, 2026.
- EU Tech Sovereignty Package Policy Brief. Belfer Center, 2026.