Countries agree to share information, they agree to work together. They agree to let police forces of other countries on their territory.
The sovereignty issue is in the fact if the national government can deny police forces on their territory or deny information from being shared.
At this moment they can still do this. But it might be possible that there is a European government or council that can overrule this and force a country to accept police forces from their neighbours or force them to share information. This is not the case.
An issue that can be raised is the privacy of the suspects and criminals that are in those databases.
Another thing is that if police forces don't cooperate, criminals have free play. They can just cross the border, commit crime and then go back and be immune.
A lot of US movies have regional police, state police, federal police, the FBI, and they work against each other. Also, there are often criminals crossing the state border to get rid of the police.
So you have to compare US states with EU countries. And yes, EU countries will have less sovereignty than the US. US can force its will on Canada, Mexico even Europe. European countries have to work together.
Another problem is how the people prevent politicians from limiting democracy, setting up a lot of managing layers and bureaucracy, centralizing power so private institutions have an easier time controlling society, etc.
The EU summit is just over. They talked about country sovereignty because at this moment not all Europeans want an EU superstate.