Mathias Döpfner is chair and CEO of Axel Springer, POLITICO’s parent company. America and Europe have been transmitting on different wavelengths for some time now. And that is dangerous — especially for Europe. The European reactions to the new U.S. National Security Strategy paper and to Donald Trump’s recent criticism of the Old Continent were, once again, reflexively offended and incapable of accepting criticism: How dare he, what an improper intrusion! But such reactions do not help; they do harm. Two points are lost in these sour responses. First: Most Americans criticize Europe because the continent matters to them. Many of those challenging Europe — even JD Vance or Trump, even Elon Musk or Sam Altman — emphasize this repeatedly. The new U.S. National Security Strategy, scandalized above all by those who have not read it, states explicitly: “Our goal should be to help Europe correct its current trajectory. We will need a strong Europe to help us successfully compete, and to work in concert with us to prevent any adversary from dominating Europe.” And Trump says repeatedly, literally or in essence, in his interview with POLITICO: “I want to see a strong Europe.” The transatlantic drift is also a rupture of political language. Trump very often simply says what he thinks — sharply contrasting with many European politicians who are increasingly afraid to say what they believe is right. People sense the castration of thought through a language of evasions. And they turn away. Or toward the rabble-rousers. My impression is that our difficult American friends genuinely want exactly what they say they want: a strong Europe, a reliable and effective partner. But we do not hear it — or refuse to hear it. We hear only the criticism and dismiss it. Criticism is almost always a sign of involvement, of passion. We should worry far more if no criticism arrived. That would signal indifference — and therefore irrelevance. (By the way: Whether we like the critics is of secondary importance.) Responding with hauteur is simply not in our interest. It would be wiser — as Kaja Kallas rightly emphasized — to conduct a dialogue that includes self-criticism, a conversation about strengths, weaknesses and shared interests, and to back words with action on both sides. Which brings us to the second point: Unfortunately, much of the criticism is accurate. Anyone who sees politics as more than a self-absorbed administration of the status quo must concede that for decades Europe has delivered far too little — or nothing at all. Not in terms of above-average growth and prosperity, nor in terms of affordable energy. Europe does not deliver on deregulation or debureaucratization; it does not deliver on digitalization or innovation driven by artificial intelligence. And above all: Europe does not deliver on a responsible and successful migration policy. The world that wishes Europe well looked to the new German government with great hope. Capital flows on the scale of trillions waited for the first positive signals to invest in Germany and Europe. For it seemed almost certain that the world’s third-largest economy would, under a sensible, business-minded and transatlantic chancellor, finally steer a faltering Europe back onto the right path. The disappointment was all the more painful. Aside from the interior minister, the digital minister and the economics minister, the new government delivers in most areas the opposite of what had been promised before the election. The chancellor likes to blame the vice chancellor. The vice chancellor blames his own party. And all together they prefer to blame the Americans and their president. Instead of a European fresh start, we see continued agony and decline. Germany still suffers from its National Socialist trauma and believes that if it remains pleasantly average and certainly not excellent, everyone will love it. France is now paying the price for its colonial legacy in Africa and finds itself — all the way up to a president driven by political opportunism — in the chokehold of Islamist and antisemitic networks. In Britain, the prime minister is pursuing a similar course of cultural and economic submission. And Spain is governed by socialist fantasists who seem to take real pleasure in self-enfeeblement and whose “genocide in Gaza” rhetoric mainly mobilizes bored, well-heeled daughters of the upper middle class. Hope comes from Finland and Denmark, from the Baltic states and Poland, and — surprisingly — from Italy. There, the anti-democratic threats from Russia, China and Iran are assessed more realistically. Above all, there is a healthy drive to be better and more successful than others. From a far weaker starting point, there is an ambition for excellence. What Europe needs is less wounded pride and more patriotism defined by achievement. Unity and decisive action in defending Ukraine would be an obvious example — not merely talking about European sovereignty but demonstrating it, even in friendly dissent with the Americans. (And who knows, that might ultimately prompt a surprising shift in Washington’s Russia policy.) That, coupled with economic growth through real and far-reaching reforms, would be a start. After which Europe must tackle the most important task: a fundamental reversal of a migration policy rooted in cultural self-hatred that tolerates far too many newcomers who want a different society, who hold different values, and who do not respect our legal order. If all of this fails, American criticism will be vindicated by history. The excuses for why a European renewal is supposedly impossible or unnecessary are merely signs of weak leadership. The converse is also true: where there is political will, there is a way. And this way begins in Europe — with the spirit of renewal of a well-understood “Europe First” (what else?) — and leads to America. Europe needs America. America needs Europe. And perhaps both needed the deep crisis in the transatlantic relationship to recognize this with full clarity. As surprising as it may sound, at this very moment there is a real opportunity for a renaissance of a transatlantic community of shared interests. Precisely because the situation is so deadlocked. And precisely because pressure is rising on both sides of the Atlantic to do things differently. A trade war between Europe and America strengthens our shared adversaries. The opposite would be sensible: a New Deal between the EU and the U.S. Tariff-free trade as a stimulus for growth in the world’s largest and third-largest economies — and as the foundation for a shared policy of interests and, inevitably, a joint security policy of the free world. This is the historic opportunity that Friedrich Merz could now negotiate with Donald Trump. As Churchill said: “Never waste a good crisis!”

The Trump administration is forming a coalition to counter China’s dominant control of critical minerals and emerging power as a center of AI and other tech sectors. The administration plans to launch the coalition of partners with the signing Friday of the Pax Silica Declaration, uniting Singapore, Australia, Japan, South Korea and Israel in a collaboration intended to address deficits in critical mineral access edging out China’s massive investment in its critical minerals and tech sector. The administration is actively looking to enlist other countries to join the group. The initiative underscores the degree to which the Trump administration considers China’s near monopoly in rare earths – minerals that are critical to civilian and military applications – and dominance of other parts of the global supply chain, as a significant threat. Beijing has wielded its dominance of the sector through export restrictions intended to hit back against the Trump administration’s aggressive tariff policy on Chinese imports. The declaration also reflects U.S. concern about China’s massive investment in artificial intelligence and quantum computing that could give it a competitive edge in the 21st century economy. “It’s an industrial policy for an economic security coalition and it’s a game changer because there is no grouping today where we can get together to talk about the AI economy and how we compete with China in AI,” Helberg said. “By aligning our economic security approaches, we can start to have cohesion to basically block China’s Belt and Road Initiative — which is really designed to magnify its export-led model — by denying China the ability to buy ports, major highways, transportation and logistics corridors.” Helberg said that the Trump administration aims to expand the coalition from the initial five countries that sign the declaration to include more allies and partners with mineral, technological and manufacturing resources. The signing of the declaration kicks off the administration’s one-day Pax Silica Summit, which will include officials from the European Union, Canada, the Netherlands and the United Arab Emirates. The summit will feature discussions about cooperation in areas such as advanced manufacturing, mineral refining and logistics. “This grouping of countries will be to the AI age what the G7 was to the industrial age,” Helberg said. “It commits us to a process by which we’re going to cooperate on aligning our export controls, screening of foreign investments, addressing anti-dumping but with a very proactive agenda on securing choke points in the global supply chain system.”

BRUSSELS — The EU has struck a political agreement to overhaul the bloc’s foreign direct investment screening rules, the Council of the EU announced on Thursday, in a move to prevent strategic technology and critical infrastructure from falling into the hands of hostile powers. The updated rules — the first major plank of European Commission President’s Ursula von der Leyen’s economic security strategy — would require all EU countries to systematically monitor investments and further harmonize the way those are screened within the bloc. The agreement comes just over a week after Brussels unveiled a new economic security package. Under the new rules, EU countries would be required to screen investments in dual-use items and military equipment; technologies like artificial intelligence, quantum technologies and semiconductors; raw materials; energy, transport and digital infrastructure; and election infrastructure, such as voting systems and databases. As previously reported by POLITICO, foreign entities investing into specific financial services must also be subject to screening by EU capitals. “We achieved a balanced and proportionate framework, focused on the most sensitive technologies and infrastructures, respectful of national prerogatives and efficient for authorities and businesses alike,” said Morten Bødskov, Denmark’s minister for industry, business and financial affairs. It took three round of political talks between the three institutions to seal the update, which was a key priority for the Danish Presidency of the Council of the EU. One contentious question was which technologies and sectors should be subject to mandatory screening. Another was how capitals and the European Commission should coordinate — and who gets the final say — when a deal raises red flags. Despite a request from the European Parliament, the Commission will not get the authority to arbitrate disputes between EU countries on specific investment cases. Screening decisions will remain firmly in the purview of national governments. “We’re making progress. The result of our negotiations clearly strengthens the EU’s security while also making life easier for investors by harmonising the Member States’ screening mechanism,” said the lead lawmaker on the file, French S&D Raphaël Glucksmann. “Yet more remains to be done to ensure that investments bring real added value to the EU, so that our market does not become a playground for foreign companies exploiting our dependence on their technology. The Commission has committed to take an initiative; it must now act quickly,” he said in a statement to POLITICO. This story has been updated.

BRUSSELS — The European Commission has opened an antitrust investigation into whether Google breached EU competition rules by using the content of web publishers, as well as video uploaded to YouTube, for artificial intelligence purposes. The investigation will examine whether Google is distorting competition by imposing unfair terms and conditions on publishers and content creators, or by granting itself privileged access to such content, thus placing rival AI models at a disadvantage, the Commission said on Tuesday. In a statement, the EU executive said it was concerned that Google may have used the content of web publishers to provide generative AI-powered services on its search results pages without appropriate compensation to publishers, and without offering them the possibility to refuse such use of their content. Further, it said that the U.S. search giant may have used video and other content uploaded on YouTube to train Google’s generative AI models without compensating creators and without offering them the possibility to refuse such use of their content. The formal antitrust probe follows Google’s rollout of AI-driven search results, which resulted in a drop in traffic to online news sites. Google was fined nearly €3 billion in September for abusing its dominance in online advertising. It has proposed technical remedies over that penalty, but resisted a call by EU competition chief Teresa Ribera to break itself up.

BRUSSELS — The EU will start using high-resolution satellites and the latest drone technology to crack down on drugs smuggled through its borders, as cocaine and synthetic drugs swarm European capitals and the bloc grapples with growing drug trafficking violence. “When it comes to illegal drugs, Europe is reaching a crisis point,” said European Commissioner for Internal Affairs and Migration Magnus Brunner on Thursday, while presenting the new EU Drugs Strategy and action plan against drug trafficking. They lay out actions to boost international cooperation, stop the import of illicit drugs, dismantle production sites, curb recruitment of young people to criminal networks and tackle the growing drug-related violence that has taken capitals hostage. As gang networks evolve and drug traffickers constantly find new “loopholes” to bring their drugs into Europe, the EU and countries will work with customs, agencies and the private sector to better monitor and disrupt trafficking routes across land, sea or air. This includes using the latest technologies and artificial intelligence to find drugs sent via mail, monitoring aviation and publishing its upcoming EU Ports Strategy for port security. EU border security agency Frontex will get “state of the art resources,” said Brunner, including high-resolution satellites and drones. “Drug traffickers use the latest technologies, which means we need innovation to beat them,” Brunner said. To stay up to date, the European Commission is establishing a Security and Innovation Campus to boost research and test cutting-edge technologies in 2026. “We send the drug lords and their organizations a clear message: Europe is fighting back,” Brunner said. On top of the increased import of illegal drugs, Europe is grappling with the growing in-house production of synthetic drugs, with authorities dismantling up to 500 labs every year. To tackle this, the European Union Drugs Agency will develop a European database on drug production incidents and an EU-wide substance database to help countries identify synthetic drugs and precursor chemicals. The EU is also looking at its existing laws, evaluating the current rules against organized crime and the existing Framework Decision on drug trafficking by 2026. The EUDA’s new European drug alert system, launched a couple of weeks ago, will also help issue alerts on serious drug-related risks, such as highly potent synthetic drugs; while its EU early warning system will help identify new substances and quickly inform the capitals. Europe is grappling with a surge in the availability of cocaine, synthetic stimulants and potent opioids, alongside increasingly complex trafficking networks and rising drug-related violence, particularly in Belgium and the Netherlands. The quantity of drugs seized in the EU has increased dramatically between 2013 and 2023, the commissioner said, with authorities seizing 419 metric tons of cocaine in 2023 — six times more than the previous decade. But it’s not just the drugs — illicit drug trafficking comes with “bloodshed, violence, corruption, and social harm,” Brunner said. Criminal networks are increasingly recruiting young and vulnerable people, often using social media platforms. To fight this, the EU will launch an EU-wide platform to “stop young people being drawn into drug trafficking,” connecting experts across Europe. “I think that is key — to get engaged with the young people at an early stage, to prevent them getting into the use of drugs,” Brunner said. The new strategy — and accompanying action plan — will define how Europe should tackle this escalating crisis from 2026 to 2030. “Already too many have been lost to death, addiction and violence caused by traffickers. Now is the time for us to turn the tides,” he added.

BRUSSELS — The European Commission will open an investigation into Meta’s integration of artificial intelligence into its WhatsApp chat app, competition chief Teresa Ribera said. “I can confirm you that today we will adopt a decision on Meta AI and we will open a procedure around this,” Ribera told a hearing of the European Parliament’s economic affairs committee on Thursday. She added: “But we have not signed it yet.” The commissioner was replying to a question by Renew lawmaker Stéphanie Yon-Courtin, who’d asked her to comment on a press report on the matter. The Financial Times reported that the EU was set to launch an antitrust probe into Meta over the use of AI in WhatsApp. A similar probe was opened earlier this year by the Italian competition authority. The European Commission confirmed earlier this week that it was looking into complaints that Meta had put up barriers that effectively excluded other AI assistants from the Facebook parent’s popular messaging app.

Microsoft’s CEO said Monday that his company is increasingly looking to Europe as a key region for its artificial intelligence strategy, as the continent seeks to bolster digital independence from the United States and China. “We are investing in Germany, in the European Union with our capital, putting it at risk,” Satya Nadella said during an interview on the MD Meets podcast, hosted by Mathias Döpfner, the chair and CEO of Axel Springer, the German media group that owns POLITICO. “These are not AI factories or cloud factories that sit in the United States. They are in the continent and in the country,” he added. In the conversation, Nadella stressed that digital sovereignty is a critical consideration for any nation. “I think that every country, whether it’s at the European Union level or at the country level, like in Germany, I think sovereignty is an important consideration,” he said. “So every country would like to ensure that there is continuity of their supply, there is resilience in their supply. And there’s agency in which they operate. And that’s one of the reasons why we have made all these commitments.” Nadella said that true sovereignty goes beyond infrastructure. “The new chapter of sovereignty is … what is a German automaker or a German industrial company? How are they going to have their own AI factory and foundation model that is unique to them?” he said. “That is, to me, the true definition of sovereignty.” Nadella’s comments come as European leaders increasingly warn that the continent cannot afford to cede the “digital sphere” to the global superpowers of the U.S. and China without serious consequences. At the Digital Sovereignty Summit in Berlin on Nov. 18, Germany and France unveiled a series of initiatives aimed at strengthening European technological independence, spanning cloud services, AI and public procurement. Among the measures were commitments to favor European solutions in public contracts, safeguard European data from foreign surveillance and confront the market dominance of major U.S. cloud providers. “If we let the Americans and the Chinese have all of the champions, one thing is certain: we may have the best regulation in the world, but we won’t be regulating anything,” French President Emmanuel Macron warned. Nadella acknowledged China’s strength in human capital and open-source innovation but stressed the continued leadership of the U.S. “The United States still continues to lead, whether it’s on the AI systems or whether it is the frontier models or the AI products around the world,” he said. “It is not just the ingenuity of the American tech sector, but also the American tech stack being the most trusted tech stack in the world.” Nadella argued that Europe could emerge as a major winner in the global AI landscape if it focuses on actually implementing and spreading the technology across industries. “Quite frankly, the country that is going to really win is going to be the one that can scale up broadly on AI, use AI broadly in their economy, in their health sector, in their manufacturing sector, in the education sector, and grow their economy,” he said. “Germany or Europe could be the big winner as long as they do the hard work of actually getting the technology in, re-skilling, using that technology,” he added.

BRUSSELS — Russia’s drones and agents are unleashing attacks across NATO countries and Europe is now doing what would have seemed outlandish just a few years ago: planning how to hit back. Ideas range from joint offensive cyber operations against Russia, and faster and more coordinated attribution of hybrid attacks by quickly pointing the finger at Moscow, to surprise NATO-led military exercises, according to two senior European government officials and three EU diplomats. “The Russians are constantly testing the limits — what is the response, how far can we go?” Latvian Foreign Minister Baiba Braže noted in an interview. A more “proactive response is needed,” she told POLITICO. “And it’s not talking that sends a signal — it’s doing.” Russian drones have buzzed Poland and Romania in recent weeks and months, while mysterious drones have caused havoc at airports and military bases across the continent. Other incidents include GPS jamming, incursions by fighter aircraft and naval vessels, and an explosion on a key Polish rail link ferrying military aid to Ukraine. “Overall, Europe and the alliance must ask themselves how long we are willing to tolerate this type of hybrid warfare … [and] whether we should consider becoming more active ourselves in this area,” German State Secretary for Defense Florian Hahn told Welt TV last week. Hybrid attacks are nothing new. Russia has in recent years sent assassins to murder political enemies in the U.K., been accused of blowing up arms storage facilities in Central Europe, attempted to destabilize the EU by financing far-right political parties, engaged in social media warfare, and tried to upend elections in countries like Romania and Moldova. But the sheer scale and frequency of the current attacks are unprecedented. Globsec, a Prague-based think tank, calculated there were more than 110 acts of sabotage and attempted attacks carried out in Europe between January and July, mainly in Poland and France, by people with links to Moscow. “Today’s world offers a much more open — indeed, one might say creative — space for foreign policy,” Russian leader Vladimir Putin said during October’s Valdai conference, adding: “We are closely monitoring the growing militarization of Europe. Is it just rhetoric, or is it time for us to respond?” Russia may see the EU and NATO as rivals or even enemies — former Russian President and current deputy Kremlin Security Council head Dmitry Medvedev last month said: “The U.S. is our adversary.” However, Europe does not want war with a nuclear-armed Russia and so has to figure out how to respond in a way that deters Moscow but does not cross any Kremlin red lines that could lead to open warfare. That doesn’t mean cowering, according to Swedish Chief of Defense Gen. Michael Claesson. “We cannot allow ourselves to be fearful and have a lot of angst for escalation,” he said in an interview. “We need to be firm.” So far, the response has been to beef up defenses. After Russian war drones were shot down over Poland, NATO said it would boost the alliance’s drone and air defenses on its eastern flank — a call mirrored by the EU. Even that is enraging Moscow. Europeans “should be afraid and tremble like dumb animals in a herd being driven to the slaughter,” said Medvedev. “They should soil themselves with fear, sensing their near and agonizing end.” SWITCHING GEARS Frequent Russian provocations are changing the tone in European capitals. After deploying 10,000 troops to protect Poland’s critical infrastructure following the sabotage of a rail line linking Warsaw and Kyiv, Polish Prime Minister Donald Tusk on Friday accused Moscow of engaging in “state terrorism.” After the incident, the EU’s foreign policy chief Kaja Kallas said such threats posed an “extreme danger” to the bloc, arguing it must “have a strong response” to the attacks. Last week, Italian Defense Minister Guido Crosetto slammed the continent’s “inertia” in the face of growing hybrid attacks and unveiled a 125-page plan to retaliate. In it he suggested establishing a European Center for Countering Hybrid Warfare, a 1,500-strong cyber force, as well as military personnel specialized in artificial intelligence. “Everybody needs to revise their security procedures,” Polish Foreign Minister Radosław Sikorski added on Thursday. “Russia is clearly escalating its hybrid war against EU citizens.” WALK THE TALK Despite the increasingly fierce rhetoric, what a more muscular response means is still an open question. Part of that is down to the difference between Moscow and Brussels — the latter is more constrained by acting within the rules, according to Kevin Limonier, a professor and deputy director at the Paris-based GEODE think tank. “This raises an ethical and philosophical question: Can states governed by the rule of law afford to use the same tools … and the same strategies as the Russians?” he asked. So far, countries like Germany and Romania are strengthening rules that would allow authorities to shoot down drones flying over airports and militarily sensitive objects. National security services, meanwhile, can operate in a legal gray zone. Allies from Denmark to the Czech Republic already allow offensive cyber operations. The U.K. reportedly hacked into ISIS’s networks to obtain information on an early-stage drone program by the terrorist group in 2017. Allies must “be more proactive on the cyber offensive,” said Braže, and focus on “increasing situational awareness — getting security and intelligence services together and coordinated.” In practice, countries could use cyber methods to target systems critical to Russia’s war effort, like the Alabuga economic zone in Tatarstan in east-central Russia, where Moscow is producing Shahed drones, as well as energy facilities or trains carrying weapons, said Filip Bryjka, a political scientist and hybrid threat expert at the Polish Academy of Sciences. “We could attack the system and disrupt their functioning,” he said. Europe also has to figure out how to respond to Russia’s large-scale misinformation campaigns with its own efforts inside the country. “Russian public opinion … is somewhat inaccessible,” said one senior military official. “We need to work with allies who have a fairly detailed understanding of Russian thinking — this means that cooperation must also be established in the field of information warfare.” Still, any new measures “need to have plausible deniability,” said one EU diplomat. SHOW OF FORCE NATO, for its part, is a defensive organization and so is leery of offensive operations. “Asymmetric responses are an important part of the conversation,” said one NATO diplomat, but “we aren’t going to stoop to the same tactics as Russia.” Instead, the alliance should prioritize shows of force that illustrate strength and unity, said Oana Lungescu, a former NATO spokesperson and fellow with London’s Royal United Services Institute think tank. In practice, that means rapidly announcing whether Moscow is behind a hybrid attack and running ‘no-notice’ military exercises on the Russian border with Lithuania or Estonia. Meanwhile, the NATO-backed Centre of Excellence on Hybrid Threats in Helsinki, which brings together allied officials, is also “providing expertise and training” and drafting “policies to counter those threats,” said Maarten ten Wolde, a senior analyst at the organization.  “Undoubtedly, more should be done on hybrid,” said one senior NATO diplomat, including increasing collective attribution after attacks and making sure to “show through various means that we pay attention and can shift assets around in a flexible way.” Jacopo Barigazzi, Nicholas Vinocur, Nette Nöstlinger, Antoaneta Roussi and Seb Starvecic contributed reporting.

BRUSSELS — You can even put an exact date on the day when Brussels finally gave up on its decade-long dream of seeking to be the predominant global tech regulator that would rein in American tech titans like Google and Apple.  It came last Wednesday — Nov. 19 — when the European Commission made an outright retreat on its data and privacy rules and hit pause on its AI regulation, all part of an attempt to make European industries more competitive in the global showdown with the United States and China.   It sounded the death knell for what has long been described as the “Brussels Effect” — the idea that the EU would be a trailblazer on tech legislation and set the world’s standards for privacy and AI.  Critics say Washington is now setting the deregulatory trajectory, while U.S. President Donald Trump is battering down Europe’s ambitions by threatening to roll out tariffs against countries that he accuses of attacking “our incredible American Tech Companies.” “I don’t hear anybody in Brussels saying ‘We’re a super regulator’ anymore,” said Marietje Schaake, who shaped Europe’s tech rulebooks as a former European Parliament member and special adviser to the European Commission. The big pivot away from rule-setting came in a “digital omnibus” proposal on Wednesday — a core part of Commission President Ursula von der Leyen’s “simplification” program to cut red tape to make Europe more competitive. The digital omnibus was one of the “main discussion points” at a meeting between the EU’s tech chief Henna Virkkunen and U.S. Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer. | Nicolas Tucat/AFP via Getty Images “Whether you call it ‘simplification’ or ‘deregulation,’ you are certainly moving away from the high watermark era of regulation,” said Anu Bradford, a professor at Columbia University who coined the term “Brussels Effect” in 2012. The deregulation drive followed a year in which the Trump administration pressured the EU to roll back enforcement of its tech rulebooks, which Big Tech giants and Trump himself deem “taxes” targeted at U.S. companies. The digital omnibus was one of the “main discussion points” at a meeting between the EU’s tech chief Henna Virkkunen, U.S. Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer on Monday. “We adopted a major package that would have an impact not only on EU companies, but also on U.S. companies, so this is the appropriate moment … to explain what we’re doing on our side,” European Commission spokesperson Thomas Regnier told reporters on Monday when asked why Virkkunen had discussed the topic with her U.S. counterparts. Lutnick, however, told Bloomberg that Washington was seeking more than just an explanation of EU laws — it wanted changes to its tech rulebooks as well. U.S. giants like Google and Meta have led a full-frontal lobbying push to replace heavy-handed EU enforcement with lighter-touch rules. Behind the push to break the shackles for tech firms is a fear of missing out on the promised economic boom linked to AI technologies. The bloc has traded its role as global tech cop for a ticket to the AI race.  GLOBAL FIRST Brussels showed its ambition to lead the world in regulating the online space throughout the 2010s. In 2016 it adopted the General Data Protection Regulation. Since then, the law has been copied in new legislation across more than 100 countries, said Joe Jones, director of research and insights at the International Association of Privacy Professionals.  When the GDPR came into force, international companies like Microsoft, Google and Facebook acknowledged it spurred them to apply EU privacy standards globally.  It served as a quintessential case of the Brussels Effect: When setting the bar in Brussels, multinational firms would roll out standards across their businesses far beyond the EU’s borders. Other governments, too, copied some of Brussels’ early attempts at setting the rules. After the GDPR, the EU adopted other laws that had the ambition of reining in Big Tech, either by pressing platforms to police for illegal content through its Digital Services Act or by blocking them from using their dominance to favor own services through the Digital Markets Act. Right after the EU adopted its risk-focused AI rulebook, Trump took office and scrapped AI safety rules embraced by his predecessor Joe Biden.  | Chip Somodevilla/Getty Images The EU’s latest blockbuster tech rulebook, the Artificial Intelligence Act, was Brussels’ latest attempt at pioneering legislation, as it sought to address the risks posed by the fledgling technology. “There was more confidence in the EU’s regulation, partially because the EU seemed confident. Right now, when the EU seems to be retreating, any government around is also asking the same question,” Bradford said. Right after the EU adopted its risk-focused AI rulebook, Trump took office and scrapped AI safety rules embraced by his predecessor Joe Biden.   The changing of the guard in Washington came right as Brussels was waking up to the need to be competitive in a global technology race. Former Italian Prime Minister Mario Draghi presented the EU’s competitiveness report in 2024, just weeks before Trump won a second term. “I think the Brussels effect is still alive and well. It just has a bit of the Draghi effect, in that it has a bit of this geopolitical innovation, pro-growth effect in it,” said IAPP’s Jones.  According to German politician Jan Philipp Albrecht, a former European Parliament member who was a chief architect of the GDPR, Europe has become blind to the benefits of its regulatory regime that set the gold standard. “Europeans have no self-secureness anymore … They don’t see the strength in their own market and in their own regulatory and innovative power,” Albrecht said.  WASHINGTON EFFECT Other critics of deregulation are taking a step further, claiming that Washington has hijacked the Brussels Effect — but just on its own terms.   “In an odd way, maybe the Trump administration has taken inspiration from the Brussels Effect, in the sense [that] they see what it means for this one regulating entity to be the one that sets global standards,” said Brian J. Chen, policy director at nonprofit research group Data & Society. It’s just, “they want to be the ones setting those standards,” Chen said. The Trump administration pressured Brussels to tone down its tech regulation during heated trade talks this summer, POLITICO previously reported. That the EU followed through with scaling back its tech laws just as the U.S. is pressing the EU is bad optics, said Schaake, the former lawmaker. “The timing of the whole simplification [package] is very bad,” she said.  She argued that it’s essential to deal with the unnecessary burden on companies, but issuing the digital omnibus after the U.S. pressure “looks like a response to that criticism.” Commission spokesperson Thomas Regnier dismissed the idea that the EU was acting on U.S. pressure. “On the digital omnibus, absolutely no third country had an influence on our sovereign simplification agenda. Because this omnibus is about Europe: less administrative burden, less overlaps, less costs,” Regnier said in a comment on Friday. “We have always been clear: Europe has its sovereign right to legislate,” Regnier added. “Nothing in the omnibus is watering down our digital legislation and we will keep enforcing it, firmly but always fairly.” This article has been updated to include new developments.

BRUSSELS — The EU’s push for the U.S. to scrap its tariffs on steel and aluminum has opened the door to an old demand from Washington: Loosen your digital rulebook, and we’ll meet you halfway. Brussels raised its concerns over Washington’s expanded list of goods covered by high steel and aluminum tariffs at meetings on Monday between Trade Commissioner Maroš Šefčovič and EU trade ministers and, from the U.S. side, Secretary of Commerce Howard Lutnick and Trade Representative Jamieson Greer. The Commerce Department in August subjected over 400 products containing steel and aluminum to a 50 percent tariff — a list the EU feels is so broad it goes against the spirit of a framework trade deal struck in July. That trade deal, which President Donald Trump and European Commission President Ursula von der Leyen clinched at Trump’s Turnberry golf resort in Scotland, sets a baseline tariff of 15 percent on most EU imports to the U.S., while the EU committed to cutting most of its own tariffs to zero. At the time, the EU and the U.S. pledged to work together to reduce tariffs on steel and aluminum — but remained vague on the details. After the Europeans raised the steel tariffs on Monday, Lutnick responded by calling on the EU to “analyze their digital rules, trying to come away with a balance … not put them away, but find a balanced approach that works with us.” “And if they can come up with that balanced approach, which I think they can, then we will, together with them, handle the steel and aluminum issues and bring that on together,” he added. Lutnick’s remarks signal a departure from the previous U.S. position, which threatened to retaliate against the bloc’s digital laws, while advocating for light-touch artificial intelligence regulation.  Lutnick sold the loosening of the bloc’s digital rules as an “opportunity” for the EU, offering U.S. investment in return, mainly through data centers that could power artificial intelligence.   “If the European Union can find a way to have a balanced digital set of rules, I think the European Union can see $1 trillion of investment,” he said. PUSHING BACK — SORT OF In response, Šefčovič reiterated the bloc’s commitment to its regulatory autonomy and its belief that its rules are not — contrary to what Washington asserts — discriminatory.  The EU side, he added, “explained how our legislation is working, we explained that this is not discriminatory. It’s not aimed at American companies. And I think that we just simply need to do more of the explanation in that regard.”  A Commission official, speaking on condition of anonymity, was more direct: “Steel and digital are completely unrelated. Steel has always been part of the discussions with the U.S. and has been formalized in the joint statement. Our sovereign digital legislation is not up for negotiations.” The EU’s digital rules are a major concern for the Donald Trump administration, and U.S. Commerce Secretary Howard Lutnick raised the matter on a visit to Brussels. | Pool photo by Aaron Schwartz/EPA The EU executive has already moved to simplify its tech rules through a digital omnibus presented last week, an effort that the EU’s tech chief, Henna Virkkunen, raised with Lutnick and Greer at an earlier meeting that day. That omnibus brought major changes to the EU’s GDPR data protection regulation, and also proposed to pause the rollout of a key part of the EU’s Artificial Intelligence Act — a controversial move championed by U.S. Big Tech companies and lobby groups.  European lawmakers and civil society groups have expressed concerns in recent weeks that the Commission’s digital simplification push is meant to placate Washington, a claim the Commission has vehemently denied.   Lawmakers are due to discuss the digital simplification package with the Commission on Tuesday. Last week, the Commission also kicked off a process to review all of its tech rulebooks, which could lead to further simplification efforts.  STEEL TALKS  Washington’s earlier decision to widen the list of steel products facing the 50 percent tariff caused uproar in Brussels, with some European lawmakers arguing that the EU should refrain from lowering its own tariffs on steel until the issue is resolved. In a bid to cozy up to the White House, the EU side on Monday pushed the idea that Brussels and Washington should jointly face up to a common enemy — China — rather than dwelling on their differences.  Danish Foreign Minister Lars Løkke Rasmussen said the two sides had addressed “some of the challenges we are facing together,” such as “overcapacity” and “China’s role in the global economy.” Asked about joint work on overcapacity, Lutnick said such issues are “easy for us to work together, and those don’t take up a lot of time when we’re talking, because when everybody just agrees right away, it’s not very difficult.” Behind closed doors, however, the U.S. stressed to its European counterparts that cooperation on China didn’t mean they would simply give the EU a pass on steel and aluminum tariffs. Šefčovič said a team from Brussels would travel to Washington in the coming weeks to address these issues.