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Big Tech, EU regulations and Trump's trade war

Published: 19 Feb. 2025, 20:00

An Pyeong-eok

The author is a professor of international relations at Daegu University.

Elon Musk, Mark Zuckerberg and Jeff Bezos stood in the front row at U.S. President Donald Trump’s inauguration on Jan. 20. The three Big Tech CEOs have actively supported Trump’s policies on deregulation and trade, lending their weight to his agenda.

Tesla and SpaceX CEO Elon Musk with his son X Æ A-Xii join US President Donald Trump as he signs executive orders in the Oval Office of the White House in Washington, DC, on Feb. 11. [AFP/YONHAP]

With Trump initiating tariff wars against Mexico, Canada and China, he escalated tensions on Feb. 10 by announcing tariffs on steel and aluminum, targeting Korea, Canada and the European Union.

However, the real flashpoint in EU-U.S. trade disputes isn’t just tariffs — regulation is the bigger battleground. For the EU, regulation is an integral part of its identity and a non-negotiable policy pillar, as well as a key countermeasure against U.S. tariffs.

Meta and X likely to struggle against EU regulations
Since 2022, the EU Digital Services Act (DSA) has been in effect, requiring major online platforms like X and Meta to remove harmful content and combat misinformation. The European Commission, which oversees EU competition policy, launched a formal investigation into Meta in mid-December 2023 and concluded that there was substantial evidence of violations, prompting further probes. Of the 449 million citizens across the EU’s 27 member states, one-third use these platforms.

Musk, with more than 220 million followers, has been actively spreading false claims online. During the U.S. presidential campaign, he repeatedly posted allegations that the Democratic Party was bringing in immigrants to commit voter fraud. In September last year, he also promoted false claims that the U.K. Labour Party was releasing sex offenders early, encouraging crime. More recently, he has interfered in Germany’s snap elections, declaring that only the far-right Alternative for Germany (AfD) party can "save Germany." If the EU’s final investigation finds that X has violated the DSA, the company could face fines of up to 6 percent of its global revenue.

Meta has already been hit. In November last year, the European Commission fined Meta 800 million euros ($835 million) for obstructing fair competition in the advertising market. In response, Zuckerberg argued that EU tech regulations are equivalent to tariffs and urged the Trump administration to intervene. This was when Meta dismantled its fact-checking team. Trump has long criticized social media platforms for curbing misinformation, and now, Big Tech appears to be aligning with his policies to pressure the EU.

Deputy Minister of Trade Park Jong-won speaks to reporters ahead of the government's emergency meeting on U.S. tariffs on steel and aluminum imports in southern Seoul on Feb. 10, 2025. [YONHAP]

Trump and U.S. tech companies argue that EU social media regulations amount to institutionalized censorship, prioritizing free speech as an absolute value. Meanwhile, Europe sees misinformation as a serious threat to democracy, believing that public interest — namely, protecting democracy — justifies certain limitations on free speech. Scholars refer to this EU approach as the “Brussels Effect” — the EU's ability to set global regulatory standards.

As the world’s largest single market, the EU has enacted regulations on carbon border taxes, Big Tech and AI. Any company seeking to operate in Europe must comply with these laws. The EU has not only enforced its own regulations but also used FTAs to push trading partners to adopt similar policies. The ongoing U.S.-EU regulatory dispute is essentially a normative battle, fueled by Big Tech’s desire to control digital data, the oil of the digital economy.

President Donald Trump holds up a signed executive order in the Oval Office of the White House on Feb. 13 in Washington. [AP/YONHAP]

The EU's major trade surplus with the United States
Trump escalated his trade rhetoric in a virtual speech at the Davos Forum in mid-January, emphasizing that the EU’s trade and regulatory policies are unfair. He had previously singled out Europe when he launched tariff wars against Canada and Mexico, arguing that the EU’s massive trade surplus with the United States was unacceptable.

In 2023 alone, the EU recorded a trade surplus of $235.5 billion with the United States, the second-largest after China. Over the past three years, the EU has consistently maintained an annual surplus of over $200 billion in its trade with the United States.

Vehicles wait to be exported at a port in Pyeongtaek, Gyeonggi, on Feb. 19. [YONHAP]

The European Commission, which manages the EU’s trade policies, has been preparing for a second Trump presidency for over a year. It established a “Trump Task Force” to brace for renewed U.S.-EU tensions. To appease the United States, the EU is planning to significantly increase imports of American LNG and automobiles. However, if negotiations fail, the EU is prepared to impose retaliatory tariffs on U.S. imports.

In this strategy, the EU is likely to leverage its regulatory control over Big Tech as a bargaining chip in its trade negotiations with America.

On Feb. 10, Trump announced a 25 percent tariff on foreign steel and aluminum. The EU responded by agreeing to negotiate but warned that if talks collapsed, it would take “firm and proportionate countermeasures.”

As the trans-Atlantic trade war intensifies, analysts predict that Trump’s “America First” trade policy could ultimately harm U.S. economic interests. Gideon Rachman, a Financial Times international columnist, warned in an editorial published on Feb. 4 that if Trump continues to alienate the EU rather than cooperating against China, the EU may instead seek closer ties with Beijing.

Similarly, Zbigniew Brzezinski, one of America’s most influential strategists, wrote in 2012 that U.S. leaders must “upgrade the West” and create a balanced strategy against the rising global East. He advocated integrating democracies like South Korea and Turkey into the Western alliance to bolster the West’s influence. According to Brzezinski, this would allow the United States to maintain equilibrium against China and Russia.

Trump, however, is taking the opposite approach. In today’s stormy geopolitical landscape, nations are drifting like ships in uncharted waters, with no clear direction in sight.

Translated using generative AI and edited by Korea JoongAng Daily staff.