The EU's Hidden Instrument to Address Trump's Trade Coercion: Moment to Activate It

Will European leadership ever confront Donald Trump and US big tech? The current inaction goes beyond a legal or economic failure: it represents a ethical collapse. This situation calls into question the very foundation of the EU's political sovereignty. The central issue is not merely the future of companies like Google or Meta, but the principle that the European Union has the authority to regulate its own digital space according to its own laws.

The Path to This Point

To begin, let us recount the events leading here. During the summer, the EU executive agreed to a humiliating deal with Trump that established a ongoing 15% tax on European goods to the US. Europe received nothing in return. The embarrassment was compounded because the EU also consented to provide well over $1tn to the US through financial commitments and purchases of energy and military materiel. The deal exposed the vulnerability of Europe's dependence on the US.

Soon after, Trump threatened crushing additional taxes if the EU enforced its regulations against US tech firms on its own soil.

Europe's Claim vs. Reality

For decades EU officials has claimed that its economic zone of 450 million affluent people gives it significant leverage in trade negotiations. But in the six weeks since the US warning, Europe has done little. No retaliatory measure has been taken. No invocation of the new anti-coercion instrument, the often described “trade bazooka” that Brussels once vowed would be its ultimate protection against foreign pressure.

Instead, we have diplomatic language and a fine on Google of less than 1% of its annual revenue for established anticompetitive behaviour, previously established in American legal proceedings, that enabled it to “exploit” its market leadership in the EU's digital ad space.

American Strategy

The US, under the current administration, has signaled its goals: it no longer seeks to strengthen European democracy. It seeks to undermine it. A recent essay released on the US State Department platform, written in paranoid, bombastic rhetoric reminiscent of Viktor Orbán's speeches, charged Europe of “an aggressive campaign against Western civilization itself”. It criticized alleged restrictions on political groups across the EU, from German political movements to PiS in Poland.

Available Tools for Response

What is to be done? The EU's anti-coercion instrument functions through calculating the degree of the coercion and applying counter-actions. If EU member states consent, the European Commission could kick US products out of Europe's market, or apply taxes on them. It can remove their patents and copyrights, block their investments and demand compensation as a condition of re-entry to Europe's market.

The tool is not merely economic retaliation; it is a statement of political will. It was created to signal that Europe would never tolerate external pressure. But now, when it is needed most, it lies unused. It is not a bazooka. It is a symbolic object.

Internal Disagreements

In the months preceding the EU-US trade deal, many European governments used strong language in official statements, but failed to push for the mechanism to be used. Some nations, including Ireland and Italy, openly advocated a softer European line.

A softer line is the worst option that the EU needs. It must enforce its regulations, even when they are challenging. Along with the trade tool, Europe should shut down social media “recommended”-style algorithms, that suggest material the user has not asked for, on European soil until they are proven safe for democracy.

Broader Digital Strategy

Citizens – not the automated systems of foreign oligarchs beholden to external agendas – should have the autonomy to make independent choices about what they see and distribute online.

The US administration is pressuring the EU to water down its digital rulebook. But now especially important, the EU should make large US tech firms accountable for anti-competitive market rigging, snooping on Europeans, and preying on our children. EU authorities must hold Ireland responsible for failing to enforce Europe's online regulations on American companies.

Regulatory action is insufficient, however. The EU must progressively replace all foreign “big tech” platforms and cloud services over the coming years with homegrown alternatives.

Risks of Delay

The significant risk of the current situation is that if the EU does not act now, it will never act again. The longer it waits, the deeper the erosion of its self-belief in itself. The more it will believe that opposition is pointless. The more it will accept that its laws are not binding, its governmental bodies not sovereign, its political system not self-determined.

When that occurs, the route to authoritarianism becomes inevitable, through automated influence on social media and the normalisation of misinformation. If the EU continues to remain passive, it will be drawn into that same decline. The EU must take immediate steps, not only to resist Trump, but to establish conditions for itself to function as a free and autonomous power.

International Perspective

And in doing so, it must make a statement that the international community can see. In Canada, Asia and Japan, democratic nations are watching. They are wondering if the EU, the remaining stronghold of liberal multilateralism, will stand against foreign pressure or yield to it.

They are asking whether democratic institutions can endure when the leading democratic nation in the world abandons them. They also see the model of Brazilian leadership, who faced down US pressure and showed that the way to deal with a bully is to respond firmly.

But if the EU delays, if it continues to issue diplomatic communications, to levy token fines, to hope for a better future, it will have effectively surrendered.