The Shifting Transatlantic Digital Diplomacy: Negotiating Non-Negotiable through the “Art of the Deal”

By Suyong (Gavin) Wang

Source: Democracy Centre for Transparency

Introduction   

On 1st April, Brussels confirmed its openness to a dialogue with Washington over growing divergences in digital regulations, raising concerns among EU lawmakers that negotiations could create a back door for Washington into the EU’s regulatory actions over non-compliant US firms. 

Since the return of the Trump administration in 2025, the divergence of transatlantic digital governance has continued to widen. During the Paris Artificial Intelligence (AI) Action Summit in February 2025, US Vice President J.D. Vance openly criticised the EU’s regulation of digital technologies, arguing that the EU’s AI governance framework is excessively restrictive and risks undermining technological innovation. Vance also spoke for American digital giants, warning that the EU’s regulation should not unfairly target American companies. His remarks came shortly after the European Commission (EC) launched formal proceedings against X (formerly Twitter) under the EU’s Digital Services Act at the end of 2025. 

Furthermore, US President Donald Trump threatened potential tariffs to counterattack penalties imposed on American technology firms, particularly labelling the EU Digital Services Act (DSA) and Digital Markets Act (DMA) as unfair “censorship regimes” directed against US technology firms. Brussels, however, has consistently maintained that its digital legislations represent "non-negotiable" sovereignties of Europe, even amid broader discussion in the context of transatlantic trade.

Nevertheless, critical voices remain concerned that Brussels’ inability to withstand the pressure from Washington will ultimately undermine its long-term commitments to Europe’s digital sovereignty and regulatory autonomy over non-compliant American firms.  

Brussels Enforcement Wave Against American Tech Giants

Between 2024 and 2025, punitive measures introduced by the European Commission primarily targeted major technology firms, including Apple, Google, Meta, and X. 

In 2024, citing EU antitrust regulations, the Commission accused Apple and Meta of abusing their dominant market positions by restricting competition in music streaming and digital advertising. Following a 2.5% decline in its US share price, Apple argued that the Commission’s enforcement would devastate fair market competition by disproportionately benefitting Spotify as the world-leading music streaming app. Meta similarly contended that the Commission failed to provide sufficient evidence proving that its business practices had produced meaningful harm to market competition in Europe.

By the following year, regulatory measures intensified under the Digital Markets Act. The Commission fined Apple €500 million for maintaining persistent restrictions on alternative application distribution channels, while Meta received a €200 million penalty over the “consent-or-pay” model embedded on Facebook and Instagram. Both companies appealed that the Commission’s decisions would fundamentally disrupt the technological architectures and the business models which their platforms highly relied on. 

The enforcement wave continued in the second half of the year. Google received further antitrust penalties related to its advertising instrument abuse , while X was investigated under the Digital Services Act (DSA) over alleged transparency failures toward its users. These firms collectively asserted that the EU’s expanding regulatory scrutiny has not only eroded their market valuations, but also imposed obstacles to their ongoing technological innovation. 

The Political Alliance Between Trump and Big Tech

The solid coalition between Trump and major US technology companies became evident during the first year of his second term. Prominent technology leaders, including Meta founder and CEO Mark Zuckerberg and X owner Elon Musk, called for more support and closer cooperation with the US government to resist what they described as accelerating global censorship pressures. Both Zuckerberg and Musk framed their arguments by citing the American First Amendment, claiming that growing regulatory interventions targeting social media platforms challenge the universal principle of freedom of speech. In particular, they identified the expanding framework of EU digital legislation as major long-term challenges for American firms. 

Given Musk’s close relationship with Trump, some analysts have described this trend - in which US tech firms increasingly call for political protection from Washington against foreign regulatory pressures - as “Muskification” of the US technological firms. This dynamic also reflects the nature of the relationship between Silicon Valley and the US government. An analysis from the Brookings Institution points out that the American firms have successfully lobbied the US government to weaken domestic digital marketplace protections for US users, and are now lobbying Washington to discourage regulatory enforcement in the rest of the world.

Transatlantic Digital Conflict Is Becoming Multidimensionally Geopolitical

Trump’s alignment with American Big Tech is fundamentally geopolitical, and is anchored in the intensifying strategic competition between the US and China over cutting-edge technologies such as AI. Beyond attempting to contain the expansion of Chinese digital influence, Washington also seeks a less restrictive regulatory environment to ensure the continued global expansion and market dominance of American Big Tech firms. In this regard, coordination with the EU is especially important, with EU member states collectively representing the world's largest market for digitally delivered services imports in 2025 at 55% of the global total according to the World Trade Organisation.

Simultaneously, the Trump administration is concerned about the accelerating normative influence of EU digital laws in global digital governance. For example, the EU’s Digital Markets Act has already become a template of digital regulations of several major digital economies, such as South Korea and Brazil, while other advanced digital markets, such as Japan, the United Kingdom and India, are also moving toward similar governance frameworks. Given the structural divergence between American and the EU regulatory values, the diffusion of the “Brussels Effect” may create persistent resistance to both Washington’s strategic goals and the commercial dominance of the US Big Tech. In response, the Trump administration has increasingly leveraged tariffs as a political instrument to discourage other countries from adopting regulatory frameworks perceived as unfavourable to American interests.

Summary

The structural divergence of digital regulation between the EU and the US originates from differences in values regarding the governance of digital technologies. Europe, relying on its significant normative influence and global market share, has a significant structural impact on Washington's strategic posture within the shifting technological landscape. This  dynamic must be considered a crucial contestation between the transatlantic partners. 

Even though Brussels remains open to dialogue, both the European Commission and civil society are likely to regard the core agendas of EU regulations as non-negotiable. Given the discretionary power of the European Commission, there are concerns that Brussels may consider making concessions on the enforcement side under tariff pressure from Washington. However, the Commission’s discretionary authority in enforcement can also serve as a bargaining chip for Brussels to defend its normative values and sovereignty if properly utilised.

In essence, the transatlantic dialogue on digital governance cannot avoid the conventional paradox between regulation and innovation, as well as the inevitable divergence in priorities between Europe and the US. As full regulatory convergence is unlikely, the major agenda of the future EU-US dialogue may involve finding a balance between these competing priorities. Broadly, geopolitics is increasingly restructuring the transatlantic digital governance beyond purely regulatory debates. Strategic bargaining driven by the shifting geopolitical landscape may emerge as the defining feature of future EU-US digital relations.

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Suyong (Gavin) Wang is an International Relations Master’s graduate whose research and publications focus primarily on European Studies and EU foreign policy.