Spain's government is directing state-controlled entities to cease contracting with U.S. data analytics firm Palantir Technologies. This directive, impacting major companies like Telefónica and Indra, stems from official worries about potential misuse of classified information and threats to national security. The move targets firms overseen by the State Society of Industrial Participations (SEPI).

The ban aims to prevent contracts that could jeopardize Spanish national sovereignty, according to corporate board sources. This intervention has already halted procurement pipelines, including a project with military shipbuilder Navantia and a Guardia Civil collaboration. The restrictions mirror similar actions taken by France and growing preference for European alternatives in Germany.

Despite the broader ban, Palantir maintains an active €16.5 million contract with the Spanish Ministry of Defense, set to expire in November. Military leadership is lobbying for its renewal, citing operational advantages. However, the government has not yet decided on an extension, while also accelerating funding for domestic platforms like Openchip.

This geopolitical friction coincides with tensions between Spain's Prime Minister Pedro Sánchez and the incoming U.S. administration. Palantir's founders have ties to Donald Trump, whose platform conflicts with Madrid's diplomatic stances.