President Donald Trump recently announced a trade deal with the European Union that will be a major victory for America.
While the deal was rightly widely celebrated, one of the key pillars with massive economic implications was largely overlooked in the media’s coverage: addressing “unjustified digital trade barriers.”
Europe is deliberately siphoning revenue from American tech and telecommunication companies while shielding its own firms from meaningful competition. They are also turning these tech platforms into tools of censorship that punish their own constituents and undermine our shared belief in the open exchange of ideas.
My colleagues and I exposed Europe’s attack on the American digital services industry in a new report. We examined the tools the EU and its constituent countries have used to build a web of protectionist policies and targeted regulations and fees to tip the scales in favor of European business and attempt to end American leadership of the digital economy.
While our open market allows competition among competitors, this European system is curtailing American companies’ growth in Europe. As we write in the report: “Despite the fact that American companies are by far the biggest players in this sector globally, EU digital service exports to the U.S. rose by more than $8 billion from 2013-2023, while the U.S. digital services exports to the EU rose by only $5 billion in the same time period.”
Addressing these targeted fees was a significant, hard-fought win for the Trump administration. When American tech and telecom companies are unfairly targeted with exorbitant fees — in some cases more than double than fees assessed to Chinese competitors — it crushes their ability to be leaders in innovation and creates uncertainty that is bad for business and consumers.
That’s why for months President Trump, Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, National Economic Council Director Kevin Hasset, and more members of the administration have called our allies to the carpet for their unfair treatment of American tech and telecom companies. The administration said addressing this egregious non-tariff barrier would be part of any trade deal and they delivered on that promise.
But even after President Trump declared victory on the issue, commentators raised questions about the details of how the deal would address the Europeans’ predatory digital tax and regulatory regime. In fact, unnamed EU officials have asserted that their digital regulation scheme was not sacrificed.
In his first public appearance after the trade deal was announced, Bessent doubled down on the Trump administration’s strong stance against the EU regulatory regime.
“They [Europeans] have just given up. It is a regulatory morass,” he said. “The EU internally taxes themselves 100% on services and 50% on goods. The EU was supposed get rid of economic friction, whether it is in finance, whether it is in technology, whether it was in energy. All the EU wants to do is overregulate.”
At the same time, Lutnick hammered home President Trump’s position reiterating that the EU’s “attack on our tech companies” was “going to be on the table.”
The unnamed EU officials claiming they’d made “absolutely no commitment on digital regulation, nor on digital taxes” might want to check back with their bosses. Ditto those EU constituent countries already looking for backdoors to impose network usage fees on American companies — explicitly taken off the table in the trade deal — through new and creative regulatory schemes.
But President Trump has made clear his expectations, and he maintains significant leverage. After Canada announced it was putting a digital service tax on American technologies, President Trump proclaimed on Truth Social, “They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us.”
At his promise of reciprocal tariffs, Canada quickly reversed course.
While the EU tries to muddy the waters and cast doubt on President Trump’s deal, one thing that is not in doubt is the president’s negotiating prowess. Whether through their own firsthand experience or the short-lived episode with Canada, the EU would be wise not to backtrack or try to weasel out of commitments to end the targeting of American companies.
President Trump has made it clear he is fighting for a fair relationship that no longer punishes American innovation, emboldens Chinese influence, or weakens America’s relationship with Europe. Our European allies must stick to their end of the deal.
Joe Grogan served as Assistant to President Donald Trump for Domestic Policy from 2019-2020 and Associate Director of the Office of Management and Budget from 2017-2019.
The views expressed in this piece are those of the author and do not necessarily represent those of The Daily Wire.