LISBON — Ursula von der Leyen’s European Commission should continue to enforce its digital rules with an iron fist despite the outcry from U.S. officials and big tech moguls, co-chair of the Greens in the European Parliament Bas Eickhout told POLITICO. As Green politicians from across Europe gather in the Portuguese capital for their annual congress, U.S. top officials are blasting the EU for imposing a penalty on social media platform X for breaching its transparency obligations under the EU’s Digital Services Act, the bloc’s content moderation rule book. “They should just implement the law, which means they need to be tougher,” Eickhout told POLITICO on the sidelines of the event. He argued that the fine of €120 million is “nothing” for billionaire Elon Musk and that the EU executive should go further. The Commission needs to “make clear that we should be proud of our policies … we are the only ones fighting American Big Tech,” he said, adding that tech companies are “killing freedom of speech in Europe.” The Greens have in the past denounced Meta and X over their content moderation policies, arguing these platforms amplify “disinformation” and “extremism” and interfere in European electoral processes. Meta and X did not reply to a request for comment by the time of publication. Meta has “introduced changes to our content reporting options, appeals process and data access tools since the DSA came into force and are confident that these solutions match what is required under the law in the EU,” a Meta spokesperson said at the end of October. Tech mogul Musk said his response to the penalty would target the EU officials who imposed it. U.S. Secretary of State Marco Rubio said the fine is “an attack on all American tech platforms and the American people by foreign governments,” and accused the move of “censorship.” “It’s not good when our former allies in Washington are now working hand in glove with Big Tech,” blasted European Green Party chair Ciarán Cuffe at the opening of the congress in Lisbon. Eickhout, whose party GreenLeft-Labor alliance is in negotiations to enter government in the Netherlands, said “we should pick on this battle and stand strong.” The Commission’s decision to fine X under the EU’s Digital Services Act is over transparency concerns. The Commission said the design of X’s blue checkmark is “deceptive,” after it was changed from user verification into a paid feature. The EU’s executive also said X’s advertising library lacks transparency and that it fails to provide access to public data for researchers as required by the law.  Eickhout lamented that European governments are slow in condemning the U.S. moves against the EU, and argued that with its recent national security strategy, the Americans have made clear their objective is to divide Europe from within by fueling far-right parties. “Some of the leaders like [French President Emmanuel] Macron are still desperately trying to say that that the United States are our ally,” Eickhout said. “I want to see urgency on how Europe is going to take its own path and not rely on the U.S. anymore, because it’s clear we cannot.”

A message from Brussels to Google: Would you break yourself up, please? The search giant faces an early November deadline to say how it intends to comply with a European Commission decision in September, which found that it had illegally maintained its grip on the infrastructure that powers online advertising. With a €2.95 billion fine in the rearview mirror, the Commission and Google find themselves in an unprecedented standoff as Brussels contemplates the once unthinkable: a structural sell-off of part of a U.S. company, preferably voluntary, but potentially forced if necessary. The situation is “very unusual,” said Anne Witt, a professor in competition law at EDHEC Business School in Lille, France. “Structural remedies are almost unprecedented at the EU level,” Witt added. “It’s really the sledgehammer.” In its September decision, the Commission took the “unusual and unprecedented step,” per Witt, to ask Google to design its own remedy — while signaling, if cautiously, that anything short of a sale of parts of its advertising technology business would fall foul of the EU antitrust enforcer. “It appears that the only way for Google to end its conflict of interest effectively is with a structural remedy, such as selling some part of its Adtech business,” Executive Vice President Teresa Ribera, the Commission’s competition chief, said at the time. As the clock counts down to the deadline for Google to tell the Commission what it intends to do, the possibility of a Brussels-ordered breakup of an American tech champion is unlikely to go unnoticed in Washington, even as the Donald Trump administration pursues its own case against the search giant. (Google accounts for 90 percent of the revenues of Alphabet, the $3.3 trillion technology holding company headquartered in Mountain View, California.) Executive Vice President Teresa Ribera, the Commission’s competition chief. | Thierry Monasse/Getty Images Google has said that it will appeal the Commission’s decision, which in its view requires changes that would hurt thousands of European businesses. “There’s nothing anticompetitive in providing services for ad buyers and sellers, and there are more alternatives to our services than ever before,” Lee-Anne Mulholland, its vice president and global head of regulatory affairs, wrote in a blog post in September. PARALLEL PROBES The proposal for a voluntary break up of Google marks the culmination of a decade of EU antitrust enforcement in digital markets in which “behavioral” fixes achieved little, and a unique alignment in both timing and substance between the U.S. and the EU of their parallel probes into the firm’s ad tech empire. “It would have been unthinkable 10 years ago that there would be a case in the U.S.  and a sister case in Europe that had a breakup as a potential outcome,” said Cori Crider, executive director of the Future of Tech Institute, which is advocating for a break-up. The Commission formally launched the investigation into Google’s ad tech stack in 2021, following a drumbeat of complaints from news organizations that had seen Google take control of the high-frequency exchanges where publishers and advertisers agree on the price and placement of online ads.  Google’s control of the exchanges, as well as infrastructure used by both sides of the market, was like allowing Goldman Sachs or Citibank to own the New York Stock Exchange, declared the U.S. Department of Justice in its lawsuit in 2023. It also created a situation in which cash-strapped news organizations on both sides of the Atlantic saw Google eating an increasing share of revenues from online advertising — and ultimately posing a threat to journalism itself. “This is not just any competition law case — this is about the future of journalism,” said Alexandra Geese, a German Green member of the European Parliament. “Publishers don’t have the revenue because they don’t get traffic on their websites, and then Google’s algorithm decides what information we see,” she said. The plight of publishers proved hefty on the other side of the Atlantic too. In April, the federal judge overseeing the U.S. government’s case against Google ruled that the search giant had illegally maintained its monopoly over parts of the ad tech market.   A spokesperson for the company said that the firm disagrees with the Commission’s charges. | Nurphoto via Getty Images The Virginia district court held a two-week trial on remedies in September. The Trump administration has advocated a sale of the exchanges and an unwinding of Google’s 2008 merger with DoubleClick, through which it came to dominate the online ad market. Judge Leonie Brinkema will hear the government’s closing arguments on Nov. 17 and is expected to issue her verdict in the coming months. STARS ALIGN Viewed by Google’s critics, it’s the ideal set of circumstances for the Commission to push for a muscular structural remedy. “If you cannot go for structural remedies now, when the U.S. is on the same page, then you’re unlikely to ever do it,” said Crider. The route to a breakup may, however, be both legally and politically more challenging. Despite the technical alignment, and a disenchantment with the impact that past fines and behavioral remedies have had, the Commission still faces a “big hurdle” when it comes to the legal test, should it not be satisfied with Google’s remedy offer, said Witt. The U.S. legal system is more conducive to ordering breakups, both as a matter of law — judges have a wide scope to remedy a harm to the market — and in tradition, said Witt, noting that the U.S. government’s lawsuits to break up Google and Meta are rooted in precedents that don’t exist in Europe. Caught in the middle is Google, which should file its proposed remedies within 60 days of being served notice of the Commission decision that was announced on Sept. 5. A spokesperson for the company said that the firm disagrees with the Commission’s charges, and therefore with the notion that structural remedies are necessary. The firm is expected to lodge its appeal in the coming days. While Google has floated asset sales to the Commission over the course of the antitrust investigation, only to be rebuffed by Brussels, the firm does not intend to divest the entirety of its ad tech stack, according to a person familiar with the matter who was granted anonymity due to the sensitivity of the case. Ultimately, what happens in Brussels may depend on what happens in the U.S. case. While a court-ordered divestiture of a chunk of Google’s ad tech business is conceivable, U.S. judges have shown themselves to be skeptical of structural remedies in recent months, said Lazar Radic, an assistant law professor at IE University in Madrid, who is affiliated with the big tech-friendly International Center for Law and Economics. “Behavioral alternatives are still on the table,” said Radic, of the U.S. case. The Commission will likely want to align itself with the U.S. should the Virginia court side with the Department of Justice, said Damien Geradin, legal counsel to the European Publishers Council — of which POLITICO parent Axel Springer is a member — that brought forward the case. Conversely, if the court opts for a weaker remedy than is being proposed, the Commission will be obliged to go further, he said. “This is the case where some structural remedies will be needed. I don’t think the [European Commission] can settle for less,” said Geradin.

A tech-savvy Italian schoolboy who died in 2006 is to become the first saint from the millennial generation in the Catholic Church on Sunday. Carlo Acutis has been dubbed “God’s influencer” and the “saint in sneakers.” The curly-haired Italian youngster died from leukemia aged 15 but is still celebrated by Catholics for how he put his web skills to use to promote his faith. Having begun coding at the age of eight, Acutis used his programming skills to build websites for the Church, including a site listing all reported miracles. As the Church struggles to connect with young people, Acutis represents a relatable role model, an example of how to evangelize in the digital age. The Church is increasingly recognizing the power of influencers who speak the language of Gen Z on video-sharing platforms like TikTok, and who can counter the Church’s perception of being outdated. Last month the Vatican hosted an event for 1,000 digital missionaries and Catholic influencers as part of its Holy Year celebrations. Catholics influencers have also been credited with a recent surge in young adult and teenage baptisms in countries including France. Initially scheduled for April 27, Acutis’ canonization at the Vatican was postponed when Pope Francis died. Pope Leo XIV is set to lead the mass and canonization in St. Peter’s Square, along with that of another young person, Pier Giorgio Frassati.  Critics have claimed that Acutis’ popularity, which has generated a multitude of books and documentaries about his life, is the result of a marketing campaign from the Church made possible by his family’s wealth and connections. But the Vatican’s Dicastery for the Causes of Saints said Acutis is part of a group of younger people that have been or are to be recognised by the church as evangelists. “Acutis’ canonization, strongly desired by Pope Francis, is not intended to acclaim him as a theologian. … It is intended to demonstrate that even today young Christians can live the Gospel faith in a consistent and all-encompassing way and have a relationship with Christ,” the dicastery wrote. Acutis’ death preceded the rise of social media like Facebook, Instagram and others. But, unlike most other saints, his followers can still watch videos of him talking about his faith. Acutis was moved to the city of Assisi in Umbria in 2017, where his tomb lies. Fittingly, he can be seen through its glass-sided casket on a web camera 24 hours a day, his body dressed in jeans, Nike sneakers and a sweatshirt. More pilgrims come to Assisi to visit Acutis’ tomb than that of St. Francis, buried in the same city, according to the local church. The Church’s newest saint “was well aware that the whole apparatus of communications, advertising and social networking can be used to lull us, to make us addicted to consumerism,” Pope Francis wrote in a 2019 apostolic exhortation, a document on papal teaching. “Yet he knew how to use new technology to transmit the Gospel.”

The European Union and the United States have issued a statement to formalize their tariff truce. Now the hard work begins. The framework agreement builds out the handshake trade agreement struck by European Commission President Ursula von der Leyen and U.S. President Donald Trump in Scotland in late July. The text sets out a roadmap for implementing the trade commitments they made. “This is not the end; it’s the beginning. This framework is a first step,” EU Trade Commissioner Maroš Šefcovič said. But the document, which runs to only four pages, skirts several issues. For one, it doesn’t mention U.S. calls for the EU to dilute its regulation of Big Tech. Nor does it refer to a call by Brussels for European wines and spirits to be exempted from the 15 percent U.S. baseline tariff that took effect this month. That’s one that Šefcovič still hopes to get a deal on. We break down the wins, the losses, the fudges — and the omissions — from the Framework on an Agreement on Reciprocal, Fair, and Balanced Trade. CARS  Under the joint statement, the U.S. will lower its 27.5 percent tariffs on cars and automotive parts to match the baseline 15 percent.  But there’s a catch: The U.S. will only meet its lower tariff commitment after the EU eliminates “tariffs on all U.S. industrial goods,” including its own 10 percent tariff on vehicles. Šefčovič said the Commission will initiate legislation this month to ensure Washington lowers tariffs retroactively on cars and auto parts effective Aug. 1, as foreseen in the deal. A separate clause of the joint statement makes clear that the two governments will start collaborating in other areas around cars, including to “provide mutual recognition on each other’s standards.”  The joint statement doesn’t clarify which standards will be mutually recognized, but any change will have ripple effects across the sector. “By signing up to mutual recognition of vehicle standards with the United States, the European Union has waved the white flag on road safety,” said Antonio Avenoso, executive director of the European Transport Safety Council. “This is not a technical detail — it is a political choice that puts trade convenience ahead of saving lives.” — Jordyn Dahl DRUGS, SEMICONDUCTORS, STEEL These industries are at the heart of Washington’s efforts to relocate industry back to the United States and are covered by separate trade investigations, known as Section 232, which allow the U.S. president to restrict imports to protect national security.  The U.S. will cap tariffs on European pharmaceuticals, lumber and semiconductors at 15 percent regardless of the results of the ongoing investigations.  Steel and aluminum imports will continue to face a 50 percent tariff until the EU and the U.S. explore the possibility of joining forces to tackle overproduction. | Erik S. Lesser/EPA This ceiling doesn’t apply to steel and aluminum imports, however, which will continue to face a 50 percent tariff until the EU and the U.S. explore the possibility of joining forces to tackle overproduction — especially coming from China — and the possibility of setting tariff-rate quotas. The European pharmaceuticals industry warns that the outline trade deal could cost companies up to €18 billion. “We remain concerned for the future of patients and our sector in Europe,” said Nathalie Moll, director general at Europe’s EFPIA pharma lobby. Still, while branded pharmaceuticals could end up being subject to the tariffs, the EU did succeed in broadening an exemption for lower-priced generics. — Camille Gijs and Mari Eccles DIGITAL RULES  The European Union managed to keep its rules on digital competition and content moderation out of the U.S. trade deal, despite heavy pressure. For now.  The Commission has for months maintained that its ability to regulate U.S. Big Tech companies is not part of the trade negotiations.  The Trump administration has been on a campaign, attacking both rulebooks and claiming they amount to censorship of Americans (the Digital Services Act) and unfairly target U.S. companies (the Digital Markets Act). While Šefčovič confirmed to reporters on Thursday that the rules weren’t part of the talks, he didn’t rule out that the two sides would return to the issue in the future.  “We kept these issues out of the trade negotiations. We were focusing on what was very clearly the priority and therefore you won’t find it referenced in the joint statement,” he said. “Will it come later, will it be discussed? Our relationship is so vast that for sure there will be a lot of issues which will be discussed.” European Parliament lawmakers will continue to pressure the Commission not to treat the rules as a bargaining chip. “Tech legislation and tariffs are two distinct matters and should remain such,” said Bulgarian conservative lawmaker Eva Maydell. — Pieter Haeck WINES AND SPIRITS Wines and spirits won’t be exempted from tariffs, even though the European Union pushed hard to obtain relief for a sector that has been caught in the crossfire from both Washington and Beijing. This means they will be subject to a 15 percent U.S. tariff.  That’s a blow for European exporters, who long benefited from tariff-free access on most spirits until successive trade wars tore it up. Wines and spirits won’t be exempted from tariffs, even though the European Union pushed hard to obtain relief for a sector that has been caught in the crossfire from both Washington and Beijing. | Guillaume Horcajuelo/EPA Šefčovič admitted that the talks had fallen short — but insisted the fight isn’t over.  “The tariffs on wine and spirits was one of the very important offensive interests of the European Union. Unfortunately, here we didn’t succeed … but the doors are not closed forever,” he told reporters.  — Bartosz Brzeziński GREEN RULES  The EU made a vague promise to address U.S. concerns regarding EU laws on mandatory sustainability reporting (the Corporate Sustainability Reporting Directive), supply chain oversight (the Corporate Sustainability Due Diligence Directive) and deforestation (the EU Deforestation Regulation). Brussels mainly pitched ideas it already wants to implement, however.   The EU will ensure its rules “do not pose undue restrictions on transatlantic trade” by reducing the administrative burden on businesses in the CSDDD and by proposing changes to the EU’s civil liability regime, which holds companies legally accountable for human rights violations and environmental damage in their supply chains.   Scrapping the EU’s liability regime is already a major point in the Commission’s omnibus proposal announced last February, which rolls back many features of the CSRD and CSDDD among other files.  Crucially, those changes have not yet received the official green light from EU countries or lawmakers.   On deforestation, the EU says it recognizes that U.S. commodities production “poses negligible risk to global deforestation,” having already labeled the country as “low risk” in its classification system last May.  — Marianne Gros AVIATION Washington commits to exempting aircraft and parts from higher tariffs, applying its very low most favored nation duties to the industry. Irish lobbyists are breathing a collective sigh of relief. A trade war slapping American tariffs on Airbus and European tariffs on Boeing would have hit the industry’s key middleman, Dublin, particularly hard. The Irish capital is the world’s biggest hub for aircraft leasing with an ecosystem of lessors and financial advisers overseeing most of the world’s leased aircraft. Ireland’s Central Statistics Office values that Irish-managed fleet at €268 billion.  Small wonder, then, that Prime Minister Micheál Martin singled out aviation when welcoming the newly published details of the EU-U.S. agreement. “Given the significance of the airline sector to Ireland, a specific carve-out for aircraft and aircraft parts is welcome,” he said. — Shawn Pogatchnik DEFENSE  The EU promised to buy more American weapons under Thursday’s trade deal, although a senior official downplayed any impact on efforts to boost Europe’s military industrial complex. The EU “plans to substantially increase procurement of military and defence equipment from the United States, with the support and facilitation of the U.S. government,” the joint statement said.  That could deal a blow to the European defense industry, which Brussels has been trying to strengthen with initiatives like the €150 billion loans-for-weapons Security Action for Europe regulation to boost joint procurement, or the €1.5 billion European Defence Industry Programme still under discussion with the European Parliament. — Jacopo Barigazzi INVESTMENTS Although it’s unclear how exactly it will fulfill its promises, the EU “intends to” procure $750 billion worth of U.S. energy, including liquefied natural gas, oil and nuclear energy products, through 2028.  It will also buy “at least” $40 billion worth of U.S. artificial intelligence chips. Europe already relies heavily on U.S.-based AI chip suppliers such as Nvidia, since it has no own-production capacity in that space.  On top of that, “European companies are expected to invest an additional $600 billion across strategic sectors in the United States through 2028,” the document adds. — Camille Gijs and Pieter Haeck

The European Commission has launched a review of its digital competition rules for Big Tech and is seeking views on how the regulation has worked to date and whether it needs to be reformed. The Digital Markets Act fully came into effect in the Spring of 2024 and includes a list of do’s and don’ts for the six Big Tech companies that fall under its scope: Meta, Google, Alphabet, Apple, ByteDance and Amazon. The law, which is intended to ensure competition within a tech sector dominated by global giants, has become heavily politicized in recent months, with the U.S. administration accusing the EU of unfairly targeting American companies and classing it as a non-tariff trade barrier in U.S. President Donald Trump’s trade war. The EU executive is asking the public to give their views on whether the DMA has met its core objectives to inject fairness and contestability into digital markets, as well as its real-world impact. The Commission is obliged to review the regulation by mid-2026. Interested parties are also asked to give feedback on whether the Commission should modify its list of prescriptions and prohibitions, or the list of core platform services covered by the DMA.  Senior members of the European Parliament have called on their Commission to designate AI chatbots and cloud services under the DMA. The Commission is giving interested parties until September 24 to tell the Commission what they think of the regulation.

BRUSSELS — The European Union’s rules on content moderation, digital competition and artificial intelligence are not up for negotiation with the U.S., the European Commission’s tech chief Henna Virkkunen says. Virkkunen drew a line in the sand in an interview with POLITICO just ahead of a new round of talks between EU Trade Commissioner Maroš Šefčovič and U.S. Trade Representative Jamieson Greer on Thursday. The two sides were reported to be inching closer to a deal that includes how U.S. tech companies are treated under the EU’s Digital Markets Act. “The [Digital Services Act], the [Digital Markets Act] and the AI Act of course, these are very important rules for us to make sure that we have trustworthy technologies,” Virkkunen said. “So, this is not part of trade negotiations from our side.” The rules are not up for negotiation because they are “based on our European values,” Virkkunen underlined. The Trump administration and U.S. tech executives have pushed back strongly against the EU’s tech rules in recent months, arguing that the Digital Services Act would allow Americans to be censored, and that the Digital Markets Act unfairly targets U.S. companies. Washington has also called for the EU’s AI Act to be paused, a demand that is now gaining traction among European government officials and several EU tech executives. Virkkunen also rebuffed the framing of EU tech fines as “tariffs,” saying the Commission is not “looking for fines” and that the penalties are meant to force companies to comply. The EU’s tech chief also indicated that the Commission is proceeding full steam ahead with its ongoing probes under the bloc’s Digital Services Act, and promised that several of them will reach fruition soon. “There are so many investigations in the pipeline that we are also able to come to conclusions with many of them in the coming weeks and months,” she said. The most anticipated probe concerns Elon Musk’s X. The platform was found last summer to be in preliminary breach of the EU’s content moderation rules regarding dark patterns, advertising transparency and data access for researchers. Virkkunen declined to comment on whether it would now be easier for the Commission to wrap up the probe and issue a fine against X and Musk, given that the tech billionaire has fallen out of favor with U.S. President Donald Trump. Trump didn’t rule out deporting Musk on Tuesday. “When we are investigating the platforms, it’s based [on] evidence and based [on] our Digital Services Act, and not [on] who’s the owner,” Virkkunen said.

BRUSSELS — The European Union has missed a key milestone in its effort to rein in the riskiest artificial intelligence models amid heavy lobbying from the U.S. government. After ChatGPT stunned the world in November 2022, EU legislators quickly realized these new AI models needed tailor-made rules. But two and a half years later, an attempt to draft a set of rules for companies to sign on to has become the subject of an epic lobbying fight involving the U.S. administration.  Now the European Commission has blown past a legal deadline of May 2 to deliver.  Pressure has been building in recent weeks: In a letter to the Commission in late April, obtained by POLITICO, the U.S. government said the draft rules had “flaws” and echoed many concerns aired in recent months by U.S. tech companies and lobbyists.  It’s the latest pushback from the Trump administration against the EU’s bid to become a super tech regulator, and follows attacks on the EU’s social media law and digital competition rules. The delay also exposes the reality that the rules are effectively a bandage measure after EU legislators failed to settle some of the thorniest topics when they negotiated the binding AI Act in early 2024. The rules are voluntary, leading to a complicated dance between the EU and industry to land on something meaningful that companies will actually implement. POLITICO walks you through how a technical process turned into a messy geopolitical lobbying fight — and where it goes from here. 1. WHAT IS THE EU TRYING TO DO? Brussels is trying to put guardrails around the most advanced AI models such as ChatGPT and Gemini. Since September, a group of 13 academics tasked by the Commission has been working on a “code of practice” for models that can perform a “wide range of distinct tasks.”  That initiative was inspired by ChatGPT’s rise to fame in late 2022. The instant popularity of a chatbot that could perform several tasks upon request, such as generating text, code and now also images and video, upended the bloc’s drafting of the AI Act.  Generative AI wasn’t a thing when the Commission first presented its AI Act proposal in 2021, which left regulators scrambling. “People were saying: we will not go through five more years to wait for a regulation, so let’s try to force generative AI into this Act,” Audrey Herblin-Stoop, a top lobbyist at French OpenAI rival Mistral, recalled at a panel last week.   Brussels is trying to put guardrails around the most advanced AI models such as ChatGPT and Gemini. | Klaudia Radecka/NurPhoto via Getty Images EU legislators decided to include specific obligations in the act on “general-purpose AI,” a catch-all term that includes generative AI models like OpenAI’s GPT or Google’s Gemini. The final text left it up to “codes of practice” to put meat on the bones.  2. WHAT IS IN THE CODE THAT WAS DUE MAY 2? The 13 experts, including heavy hitters like Yoshua Bengio, a French Canadian computer scientist nicknamed the “godfather of AI,” and former European Parliament lawmaker Marietje Schaake, have worked on several thorny topics. According to the latest draft, signatories would commit to disclosing relevant information about their models to authorities and customers, including the data being used to train them, and to drawing up a policy to comply with copyright rules. Companies that develop a model that carries “systemic risks” also face a series of obligations to mitigate those risks. The range of topics being discussed has drawn immense interest: Around 1,000 interested parties ranging from EU countries, lawmakers, leading AI companies, rightsholders and media to digital rights groups have weighed in on three different drafts.  3. WHAT ARE THE OBJECTIONS? U.S. Big Tech companies, including Meta and Google, and their lobby group representatives have repeatedly warned that the code goes beyond what was agreed on in the AI Act. Just last week, Microsoft President Brad Smith said “the code can be helpful” but warned that “if too many things [are] competing with each other … it’s not necessarily helpful.”   The companies also claim this is the reason the deadline was missed.  “Months [were] lost to debates that went beyond the AI Act’s agreed scope, including [a] proposal explicitly rejected by EU legislators,” Boniface de Champris, senior policy manager at Big Tech Lobby CCIA, told POLITICO. Digital rights campaigners, copyright holders and lawmakers haven’t been impressed with Big Tech’s criticism.  “We have to ensure that the code of practice is not designed primarily to make AI model providers happy,” Italian Social Democrat lawmaker Brando Benifei and the Parliament’s AI Act lead negotiator said in an interview — a clear hint that the Parliament doesn’t want a watered-down code.  Benifei was among a group of lawmakers who resisted a decision in March to remove “large-scale discrimination” from a list of risks in the code that AI companies must manage.  Brando Benifei was among a group of lawmakers who resisted a decision in March to remove “large-scale discrimination” from a list of risks in the code that AI companies must manage. | Simona Granati – Corbis/Corbis via Getty Images There have also been allegations of unfair lobbying tactics by U.S. Big Tech. Last week, two non-profit groups complained that “Big Tech enjoyed structural advantages.”  “A staggering amount of corporate lobbying is attempting to weaken not just the EU’s AI laws but also DMA and DSA,” said Ella Jakubowska, head of policy at European Digital Rights.  Tech lobby CCIA resisted that criticism, saying AI model providers are “the primary subjects of the code” but make up only 5 percent of the 1,000 interest groups involved in the drafting.   4. WHAT HAS THE U.S. GOVERNMENT SAID? The U.S. administration has been less public in its pushback against the EU’s AI rules than in its attacks on the EU’s social media law (the Digital Services Act) and the EU’s digital competition rules (the Digital Markets Act).  Behind the scenes, the positioning has been strong. The U.S. Mission to the EU filed feedback on the third draft of the code of practice in a letter to the European Commission echoing many of the concerns already aired by U.S. tech executives or lobby groups. “Several elements in the code are not found in the AI Act,” the letter read. The mission piggybacked on the European Commission’s own pivot toward focusing on AI innovation, and said that the code must be improved “to better enable AI innovation.”  5. HOW WILL THIS PLAY OUT? Ultimately, the success of the effort hinges on whether leading AI companies such as U.S.-based Meta, Google, OpenAI, Anthropic and French Mistral sign on to it.   That means the Commission needs to figure out how to publish something that meets its intentions while also being sufficiently palatable to Big Tech and the Trump administration. The Commission has repeatedly stressed that the code is a voluntary tool for companies to ensure they comply — but more recently warned that life could be more complicated for companies that don’t sign it. Those who do sign the code will “benefit from increased trust” by the Commission’s AI Office and “from reduced administrative burden,” said European Commission spokesperson Thomas Regnier. Benifei too said that it’s “our challenge to make sure that the obligations behind the code are somehow applicable to those that don’t sign the code.” Under the timelines set out in the AI Act, providers of the most complex AI models will have to abide by the new obligations, either through the code or otherwise, by Aug. 2.

BRUSSELS — The American tech sector has a big, fat target on its back as Europe looks to respond to Washington on tariffs. If only Brussels agreed on how to hit it.  As United States President Donald Trump rolled out a roster of tariffs late Wednesday, European top officials and lawmakers noted that Big Tech firms and digital services could be Washington’s Achilles heel. The European Union has a €157 billion trade surplus in goods, which means it exports more than it imports, but it runs a deficit of €109 billion in services, including digital services. Big Tech giants like Apple, Microsoft, Amazon, Google and Meta dominate all sorts of parts of the market in Europe.  European Commission President Ursula von der Leyen mentioned technology as one of the “cards” the bloc can play when she addressed the looming tariffs in a European Parliament session on Tuesday.  But the EU is conflicted on what to do about it.  Its flagship tech laws like the Digital Markets and Digital Services acts (DMA and DSA) aren’t designed to serve as retaliation tools. Attempts to slap higher taxes on tech giants previously failed. Governments could decrease their spending on Big Tech firms by revising public procurement policies, but in many cases Europe doesn’t have its own alternatives to turn to instead. And some capitals, like Dublin, are already warning that hitting U.S. tech would badly damage the bloc’s own economy.  Directly targeting Big Tech is all but certain to trigger the ire of tech CEOs like Elon Musk, Jeff Bezos and Mark Zuckerberg, who have cultivated close ties with Trump.  Europe could also deploy its strongest trade weapon yet, the Anti-Coercion Instrument, to target U.S. tech firms specifically. But as a tool the ACI is untested: It was designed as a “trade bazooka” following the first Trump administration from 2017 to 2021 and has never been used.  LAWS VERSUS TRADE WARS The EU has yet to land some of the landmark probes it has been conducting under the DMA (on digital competition) and DSA (on content moderation).  The Commission is set to fine Apple and Meta for violating digital competition rules, the first such fines to be issued under the DMA, late this week or early next week.  Brussels has also found Elon Musk’s X in preliminary breach of the EU’s content moderation rules, which could result in fines of 6 percent of the company’s annual global turnover. Meta is also under investigation under the same rulebook.  Directly targeting Big Tech is all but certain to trigger the ire of tech CEOs like Elon Musk, Jeff Bezos and Mark Zuckerberg, who have cultivated close ties with Donald Trump. | Pool Photo by Demaree Nikhinson via Getty Images EU officials have been at pains to stress that enforcement under these laws shouldn’t be considered part of a trade war.  “The DMA is not a bargaining chip,” said French Renew lawmaker Stéphanie Yon-Courtin. “This regulation is conceived to establish fair rules of the game in Europe, not to be leveraged in a trade agreement with the United States.” The lead lawmaker on the DMA, Andreas Schwab of the center-right European People’s Party (EPP), said the Commission should have been quicker to issue its imminent decisions on Apple and Meta, precisely to show that “there is nothing political about them.” The core argument is that the EU’s tech laws exist to uphold European values, not to discriminate or to target a given country. Any suggestion to the contrary could hurt the Commission when Big Tech firms inevitably litigate the first fines and penalties under the laws. Washington, however, has suggested the opposite. The Trump administration in February threatened retaliatory tariffs against the EU tech regime specifically, citing perceived risks for U.S. companies and freedom of expression.  Wednesday’s tariff announcements from the White House have reupped calls for Brussels to pull the trigger on investigations under the rulebooks.   Since Trump is “open for negotiations, I fear that he will try to use the digital services as a negotiating tool. But I hope the European Commission will be firm,” Danish socialist MEP Christel Schaldemose said.  Greens lawmaker Alexandra Geese agreed: “Let’s strongly enforce DSA and DMA.”  TAXES AND LEVIES Proponents of a bullish response to Trump’s tariffs see several other forms of retaliation: slapping higher taxes on digital services, and excluding U.S. tech firms from bidding for government contracts. Brando Benifei, a social democrat lawmaker who leads the Parliament’s delegation to the U.S., flagged the need for “broad countermeasures that hit where it really hurts,” with “targeting services, such as big tech firms,” as one option. In a written comment he suggested retaliating against intellectual property rights or excluding U.S. companies from public procurement. Digital services will “inevitably come into focus,” said Finnish EPP lawmaker Aura Salla, who is also a former top lobbyist for Meta in Brussels. EPP President Manfred Weber said on Tuesday that the “digital giants only pay little to our digital infrastructure where they benefit so much.”  Some EU countries are adding to the chorus. On Thursday French government spokesperson Sophie Primas said the EU’s next wave of retaliation could target “digital services that are currently not taxed. ”  The Commission is set to fine Apple and Meta for violating digital competition rules, the first such fines to be issued under the DMA, late this week or early next week. | Oliver Douliery/Getty Images French liberal European lawmaker Sandro Gozi, meanwhile, mentioned “taxing American digital giants” as among the options.  The issue of a digital services tax has been simmering for a while in the EU, but the bloc’s 27 member countries have no unanimity on the issue, and taxation policy requires all EU countries to agree on joint policy. Some member countries have thus gone solo. Most recently, Belgium’s ruling coalition deal contained an agreement to install a digital tax by 2027 if there’s no deal at the international or EU level. Ireland, the European home base of several U.S. Big Tech companies, pushed back right away on Tuesday. Targeting U.S. digital services is not the EU’s position, said Irish Trade Minister Simon Harris, adding it could be very damaging for Ireland.  Gregorio Sorgi contributed reporting.

There may be a more politically incendiary moment for the European Union to crack down on Big Tech. But it’s hard to think of one. Starting Wednesday, the European Commission is staring down a series of deadlines to decide whether Apple, Meta and Google are in breach of the EU’s digital competition laws; decisions which, at least on paper, could see the companies hit with fines of up to 10 percent of their worldwide revenues. The timing’s awkward. In recent weeks, the bloc’s Digital Markets Act has come under sustained fire from United States President Donald Trump, who said it amounts to “overseas extortion” of American companies. As Trump turns up the heat in a global trade war, the White House has gone so far as to threaten additional tariffs in response to the EU’s tech regulation. But the Commission’s hands are tied. An immovable deadline for the Commission to tell Apple exactly how it should open its products and services up to rivals runs out on March 19. Normally, this would be uncontroversial; a procedural step in getting a company to comply with a new law. But any decision to censure Big Tech under the DMA risks angering Trump, who last week called Apple “a great company.”  After that, things get serious, as the Commission starts butting up against deadlines to wrap up multiple year-long noncompliance investigations against Apple, Meta and Google. EU officials have repeatedly promised that decisions are coming soon, at least for Apple and Meta, spurred on by complaints from users like Epic Games and Spotify, which say compliance efforts by Big Tech to date fall short. “The Commission would face a lot of criticism if it was perceived to be taking a deliberately ‘soft’ approach for geopolitical reasons,” says Zach Meyers, director of research at the Centre on Regulation in Europe think tank. Mindful of fraught geopolitics, the executive’s leadership has sought in recent weeks to smooth over tensions by insisting that its approach is not anti-American. “[The DMA] does not target U.S. companies,”  European commissioners Teresa Ribera and Henna Virkkunen wrote to a U.S. lawmaker earlier this month, stressing that the EU’s aim “is to ensure compliance — not to issue fines.” APPLE OF THE EU’S EYE The EU currently has six open cases against Apple, Meta and Google for not complying with various parts of the DMA. While probes should technically be completed within a year, these timelines aren’t set in stone, according to Alba Ribera Martínez, a lecturer in law at Universidad Villanueva in Madrid. What is certain is that there are at least a few touch papers waiting to be lit. The main target is Apple, which faces three investigations over failing to comply with the DMA, on top of the order from the Commission to open up its devices to rivals. The main target is Apple, which faces three investigations over failing to comply with the DMA, on top of the order from the Commission to open up its devices to rivals. | Magali Cohen/Hans Lucas/AFP via Getty Images Next week, the Commission is due to finalize one of these probes — into Apple’s rules for its app store. App developers claim that current rules unfairly prevent them from steering customers away from Apple’s payment system and fees that the company charges developers.  Two people familiar with the case, who spoke on condition of anonymity because they’re not allowed to disclose details, said that Apple would likely face a noncompliance decision on its anti-steering provisions, which could potentially come with a fine for past conduct. The next dominos to fall will be an investigation into Meta’s pay-or-consent rules, which the Commission should wrap up in the next few weeks, and a second Apple investigation into a broader set of issues concerning its app store, set to be completed this summer. Apple’s response to a third probe into its browser rules is currently being assessed by the Commission, with recent changes being welcomed by users, the Commission’s DMA lead Alberto Bacchiega said at a hearing on Monday. And Google is in the early stages of two probes into its vertical search service and its app store. The big question is what kind of action officials will take.  Each noncompliance decision will be accompanied with a cease-and-desist order and a proposal to remedy the infraction. The EU can also issue fines of up to 10 percent of a company’s worldwide revenue, rising to 20 percent for repeat infringements. But it isn’t required to — nor may fines be the most important measure the Commission can take. “The most consequential decisions that are going to be produced from the noncompliance proceedings are really the remedies,” said Ribera Martínez. MARKET IMPACT Lurking in the background is the reason that the DMA was designed in the first place: to stop Europe’s tech sector being sewn up by a handful of giants. Hundreds of developers and digital service providers — American and European alike — are waiting to see how rigorously the Commission will enforce the rules.  Many have products ready to roll out, but only once the Commission offers clarity around what the final app store changes will be, said one European game developer, granted anonymity because of their dependency on Apple and Google. Cologne-based Hubert Weid, whose firm Mobivention launched a small-scale app store last year, has yet to capitalize on the DMA’s promise to open up Apple’s hitherto-walled garden to rivals. “Our finding of success was quite limited,” he said. Coriell Wright, global public policy director at Epic Games — a larger U.S. firm — put it more bluntly. “We hope the Commission will come out swinging to put Apple and Google back into compliance,” she said.  Underlying it all is Commission President Ursula von der Leyen’s overarching goal to strengthen the EU’s competitiveness to boost its economic performance. “It is difficult to see how a light-touch approach to DMA enforcement would help,” said Meyers of the Centre on Regulation in Europe. “Emasculating the DMA would undermine the EU’s promise of providing a more predictable and rules-based order than the U.S. does,” he said.

LONDON — Britain’s chancellor and business secretary sat calmly under the Davos lights on Wednesday morning as they tried to sell the U.K. as a top investment destination. But just the night before, they’d shocked their country’s independent regulators by booting out the chair of the antitrust watchdog — and replacing him with a former tech executive. The message and its timing were clear. Regulators needed to make “pro-business decisions,” Business Secretary Jonathan Reynolds said. “He recognized it was time for him to move on and make way for somebody who does share the mission and the strategic direction that this government are taking,” said chancellor Rachel Reeves of the departure of Marcus Bokkerink, chair of the Competition and Markets Authority (CMA). Bokkerink was removed, or in Reeves’ words at Davos “decided to step down,” after coming across as “a bit of a blocker” last week at a roundtable her Treasury held with regulators to get them to boost economic growth, one government official said. The official, granted anonymity to speak candidly, said businesses frequently brought up CMA as an issue. “We needed to send a very clear signal to the regulators that we weren’t messing about,” they added of the government’s approach to regulation.  Stepping in to replace Bokkerink in the interim is Doug Gurr, a former Amazon executive and veteran of clashes with the regulator he will now chair. No wonder large tech firms are feeling hopeful. “The U.K. government is sending a clear signal, less over-enforcement please,” said Kay Jebelli, senior director for Europe at the Chamber of Progress, a U.S. trade group whose backers include Amazon, Meta, Apple and Google. “It’s good to have someone on the receiving end of CMA over-enforcement as the chair,” he added. A LOOMING FIGHT WITH BIG TECH The CMA has long faced accusations of harming the U.K.’s attractiveness to tech firms with some of its decisions, such as initially blocking Microsoft’s takeover of gaming giant Activision Blizzard and undoing Meta’s purchase of Giphy. More recently, it has turned its attention to partnerships between Big Tech and AI companies — an area in which it is seen to be out in front among its international counterparts, who will be following developments closely. The world’s largest tech firms are also set to be on the receiving end of new powers the CMA took hold of in January to regulate digital markets. The authority opened an investigation into Google’s search business last week and a second probe was expected before the end of this month into Google’s and Apple’s mobile app stores, browsers and operating systems.  But those firms caution that the CMA’s new powers don’t sit comfortably with the government’s growth mission, something the CMA strongly disputes. “The regulator needs to take care to promote the innovation and growth that ministers have rightly asked regulators to prioritize,” warned big tech lobby group the CCIA last week after the Google announcement. The CMA also worked closely with its U.S. and European counterparts, leading on investigations like that of Microsoft’s takeover of Activision, but with the election of Donald Trump the mood has shifted in the U.S. against other countries’ regulators enforcing and fining American tech firms.  Questions now turn to where Bokkerink’s departure leaves the CMA’s chief executive Sarah Cardell and its wider strategy which it published last week. Cardell said Bokkerink had “tirelessly championed consumers, competition and a level playing field for business.” It also leaves those hoping for decisive CMA action against U.S. tech firms jittery. The CMA is shortly due to announce a provisional decision on an investigation into the cloud market, affecting Microsoft and Amazon. “We urge the regulator to stay the course and take decisive action to create a fairer, more competitive cloud market that benefits businesses, consumers, and the wider digital economy,” said Nicky Stewart, from the Open CloudCoalition which is pushing for CMA action. Sam Blewett contributed to this report.