In April 2025, the European Commission fined Meta 200 million euros over its controversial “pay or consent” model, which forces EU users to either pay for ad-free access to Facebook and Instagram or consent to targeted advertising. Shortly after the fine was announced, Meta issued a press release denouncing the fine as “a multibillion-dollar tariff on Meta”. The claim was absurd; the fine had nothing to do with tariffs in any meaningful or legal sense. But that was never the point. Meta was not addressing European policymakers or the public; it was speaking directly to the White House.

By framing the fine as a tariff, Meta aimed to provoke a political response from the White House. The company claimed that the EU was unfairly targeting American businesses while allowing Chinese and European companies to operate under different standards. The strategy worked. The White House soon echoed Meta’s argument, denouncing the fines as “extraterritorial regulations that specifically target and undermine American companies” and framing them as a barrier to trade.

Tech companies have long labelled any kind of regulation or measure affecting their operations, whether related to privacy, competition, protection of children, or the public interest, as a “non-tariff barrier”.

Tech companies have long labelled any kind of regulation or measure affecting their operations, whether related to privacy, competition, protection of children, or the public interest, as a “non-tariff barrier”. Each year, tech companies and their trade associations submit comments to the Office of the United States Trade Representative (USTR) identifying such barriers for inclusion in the National Trade Estimate Report (NTE).

The Computer and Communications Industry Association, a prominent lobbying group whose members include Google, Meta, Amazon, and Apple, recently identified 395 non-tariff barriers globally for the 2025 NTE Report. 220 of these barriers were in Asia & Pacific, 69 in the Americas, 55 in Europe, 46 in the Middle East and North Africa, and 5 in the United Kingdom.

These so-called non-tariff barriers include restrictions on cross-border data flows and infrastructure localization mandates, taxes on digital goods and services, “experimental” platform regulations, ad revenue sharing with local news publishers, and restrictions on cloud services. In other words, there appears to be no clear limit to what can be framed as a non-tariff barrier. The tech policy space is not heavily regulated; there are only a limited number of regulations. Yet, this has not deterred the industry from labeling virtually any measure it opposes as a non-tariff barrier, or, more recently, as in Meta’s case, going even further to call a regulatory fine a “tariff”.

For years, the United States Trade Representative (USTR) has acted as the guardian of Big Tech’s global interests, often conflating freedom of internet commerce with “freedom of speech.”

This approach illustrates how tech companies have systematically used trade policy to influence the regulatory landscape in foreign markets. For years, the United States Trade Representative (USTR) has acted as the guardian of Big Tech’s global interests, often conflating freedom of internet commerce with “freedom of speech.” It has been instrumental in helping US tech companies build their empire internationally, free from any foreign regulatory and legislative intervention.

Trade has been a central pillar of US tech policy since the Clinton Administration. Clinton’s signature Framework for Global Electronic Commerce established the foundation for a laissez-faire regulatory approach that shaped both domestic and international tech policy. It championed industry self-regulation and positioned the US government as a guardian of Silicon Valley’s interests abroad, using trade negotiations and agreements to advance those interests on the global stage. Since then, every US president has largely adhered to this approach, except notably Biden’s USTR, which has adopted a more cautious approach. Even then, other federal agencies involved in trade have continued to promote the interests of Big Tech.

When Trump took office in January—following an inauguration where tech CEOs were treated as guests of honor—it was no surprise that his administration would continue the long-standing US policy and practice of championing the global interests of Big Tech. However, Trump did more than continue the tradition; instead of negotiating new trade deals, he reinstated tariffs and asked countries to offer concessions in exchange for tariff exemptions.

In this new landscape, tariffs became a powerful bargaining chip. US trade officials leveraged the size of the American market to pressure trading partners into removing long-standing tariff and non-tariff barriers. Countries that enjoyed tariff-free access to the US market under the WTO rules or free trade agreements, which had already made concessions to secure that preferential access, suddenly found themselves offering concessions to preserve the status quo.

They reframed the narrative around tariffs, casting them as market-correcting mechanisms designed to penalize distortive practices and level the global regulatory playing field.

This created a significant opening for Big Tech. They no longer needed digital trade rules; they reframed the narrative around tariffs, casting them as market-correcting mechanisms designed to penalize distortive practices and level the global regulatory playing field. They placed so-called non-tariff barriers at the center of Trump’s trade diplomacy, making them central to negotiations. In practice, they transformed Trump’s trade policy, originally intended to restore manufacturing jobs and support American workers, into a strategic instrument for advancing their own strategic priorities abroad.

The US is actively negotiating with more than 70 countries, so-called no-tariff barriers are a key part of these discussions. It is speculated that USTR is urging governments to make digital trade commitments similar to those in the United States-Mexico-Canada Agreement (USMCA). One of the early harvest deals was with the UK, where both parties agreed to negotiate an ambitious digital trade agreement. Since the first Trump administration, the UK has been eager to negotiate an ambitious digital trade deal with the US to claim its digital sovereignty from the EU. So, it remains an open question whether this deal reflects a significant concession from the UK side. Time will tell.

Among all the ongoing tariff talks, negotiations with the EU are particularly crucial for Big Tech. The EU has long positioned itself as a global regulator of tech. First, with the Global Data Protection Regulation (GDPR), and more recently through a wave of legislation including the Digital Services Act (DSA), the Digital Markets Act (DMA), and most recently the Artificial Intelligence Act (AI Act). These measures have been supported by high-profile, though relatively modest, fines. While enforcement has been limited and these regulations have had only a marginal impact on tech’s surveillance capitalist business model, compliance still costs companies time and some money. According to the CCIA:

“EU legislation targeting tech has grown exponentially from 27 pages in 2015 to 931 pages in 2024. U.S. companies are the primary target of this digital regulation, which costs the typical covered company $430 million annually per company in compliance costs. Opportunistic litigation, fines, and penalties are likely to add between $4.3 billion and $12.5 billion in additional costs annually per company. EU digital regulation also costs $14.8 billion in lost online advertisement revenues and $18.1 billion in lost platform, subscription, and cloud revenues across the five largest companies.”

It is no secret that tech companies are deeply critical of the EU’s expansive regulatory regime. The reinstated tariffs, particularly on steel and automobiles, sectors vital to the EU economy, have created a strategic opening for Big Tech to push back against these regulations in the tariff negotiations.

Talks are reportedly still ongoing. However, the parties have already made progress in addressing a number of long-standing economic pain points for US tech companies, including the DMA. According to the Wall Street Journal, discussions have included the possibility of exempting US companies from enforcement under the DMA. If adopted, such exemptions for Big Tech, which are designated as gatekeepers under the DMA, would significantly undermine one of the EU’s most ambitious digital regulatory efforts.

Much of the EU’s digital legislation has been significantly watered down thanks to sustained tech lobbying efforts. The European Commission’s recent trend of issuing only modest fines may satisfy some civil society groups and academics, but it does little to suggest a serious appetite for meaningful enforcement.

This probably came as a surprise to many who are big fans of the EU’s tech regulatory model, despite its limited enforcement and minimal impact, and those who have long championed the so-called “Brussels effect”. Much of the EU’s digital legislation has been significantly watered down thanks to sustained tech lobbying efforts. The European Commission’s recent trend of issuing only modest fines may satisfy some civil society groups and academics, but it does little to suggest a serious appetite for meaningful enforcement.

While regulations with 100-plus pages may look impressive in academic journals or legal commentaries, they are hardly enforced in practice. Since the AI Action summit in January, even EU political leaders have shifted their rhetoric, talking more about innovation and less about regulations in the books. There have even been discussions about revising the GDPR, delaying the implementation of the EU AI Act, and recalibrating the EU’s approach to digital governance.

At the same time, there is growing recognition that the EU lacks a strategic footing in the global AI race. After years of investing in regulation—much of it watered down by tech lobbyists or left unenforced—Europe finds itself more dependent on Big Tech, not less. With limited technological capacity or AI infrastructure, the EU has begun to explore industrial policy strategies and initiatives like Eurostack, an EU-grown infrastructure to reduce dependence on foreign platforms and build European strategic digital sovereignty.

Meanwhile, the EU’s trade policy has operated in a silo, largely disconnected from the EU’s broader political and regulatory priorities. The only significant exception has been privacy, which was treated as a fundamental right in trade agreements, thanks to long-standing European values and the efforts of DG Justice. Even that provision, however, has been weakened in recent EU digital trade partnerships, where privacy was no longer treated as a red line.

Beyond that, EU trade officials have taken a technocratic approach, narrowly focused on addressing so-called trade barriers. In doing so, they often reinforced the surveillance capitalist business model in EU trade agreements under the heavy influence of tech companies and their lobbyists. Unfortunately, these agreements, especially those negotiated with the Global South countries, have received little scrutiny from digital rights experts, civil society, and academia.

Following the US shift in digital trade during the Biden Administration, the EU, along with Japan, Australia, and Singapore, emerged as the key defenders of digital trade rules in the WTO. These rules carry far-reaching consequences, shaping not only the digital economy but also the digital infrastructure, balance of power, information ecosystems, the broader fabric of society, and democracy worldwide.

Now, the EU is at the negotiation table with the US, which no longer plays by the rules they once wrote together.

The EU has long portrayed itself as the principled defender of the global trade order, a true believer in rules-based multilateralism. Now, the EU is at the negotiation table with the US, which no longer plays by the rules they once wrote together. In the end, when the choice comes down to shielding core industries like steel or automobiles or defending symbolic regulatory ideals, Brussels will likely prioritize its industrial base over its regulatory doctrine.

Time will tell what choices European leaders will make. But for now, Meta and other tech companies have little to worry about. In this new era, their interests are not only protected; they are the ones setting the terms of the debate, both in Washington DC, and far beyond.