Europe

The European Commission is seemingly oblivious to concerns about innovation and user experience as it forces through DMA decisions against Apple and Google.

EU policymakers frame their legislative and regulatory actions against U.S. tech companies as measures to promote competition and protect consumers. But they operate as protectionist trade barriers and revenue-generating mechanisms.

The magnitude of the total fines against U.S. companies is extraordinary. To put the amount in perspective, it is roughly the same as the GDP of Fiji. It could cover the cost of sending five rovers to explore Mars. It would be enough to build two new football stadiums in Washington, DC. It could even pay for every household in America to buy six dozen eggs.

Europe risks undermining its competitiveness in the AI race by heeding calls to extend the DMA to AI and cloud services.

Vice President Vance was right to warn against stifling AI innovation with excessive regulation, but the Trump administration must go further by pushing back against policies like the EU’s Digital Markets Act and similar U.S. regulatory efforts that undermine American tech leadership. To maintain global competitiveness, the U.S. should support its leading tech companies, ensuring they have the scale and capital needed to drive AI and technological advancements, rather than subjecting them to restrictive regulations that benefit foreign competitors.

While the DMA may be motivated by Europe’s commitment to its long-held ordoliberal model of competition policy, its disproportionate effects on U.S. firms are intentional.

In this episode of the Trade War Podcast by the Information Technology and Innovation Foundation, host Stan McCoy delves into the current state of US-EU trade tensions with esteemed European trade experts Ignacio Garcia Becerro and Aslak Berg.

If the European Commission truly wants innovation-led growth, it should abandon the idea that protection equals prosperity.

The European Commission’s Competitiveness Compass rightly identifies Europe’s economic and innovation challenges but proposes misguided solutions.

Instead of treating Apple as a public utility, the Commission should work to ensure that interoperability requirements align with the broader theoretical framework that orients European competition policy, such as condemning unilateral conduct that may harm rivals only when it does not constitute competition on the merits.