How Global Turnover Fines in EU Digital Regulation Are Disproportionate and Harm U.S. Innovation

EU regulators increasingly calculate penalties for digital regulation violations as a percentage of a company’s worldwide revenue, rather than its European or national earnings. The Digital Markets Act allows fines of up to 10 percent of global turnover, rising to 20 percent for repeat offenses. The GDPR, Digital Services Act, and AI Act follow similar approaches. This model produces penalties that are often disconnected from local activity or demonstrated harm. By tying fines to global revenue, regulators can impose outsized penalties based on a firm’s overall scale rather than the nature or impact of a specific violation. As similar approaches spread beyond Europe, the cumulative burden on U.S. firms is increasing. These fines risk diverting significant resources away from research, development, and growth—undermining U.S. technology leadership at a time of intensifying global competition.

Join ITIF for a webinar on why global-turnover-based fines are disproportionate, what more targeted and proportionate enforcement could look like, and how U.S. policymakers should respond.

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