Europe’s chemical industry has reached a breaking point. The warning lights are no longer blinking — they are blazing. Unless Europe changes course immediately, we risk watching an entire industrial backbone, with the countless jobs it supports, slowly hollow out before our eyes. Consider the energy situation: this year European gas prices have stood at 2.9 times higher than in the United States. What began as a temporary shock is now a structural disadvantage. High energy costs are becoming Europe’s new normal, with no sign of relief. This is not sustainable for an energy-intensive sector that competes globally every day. Without effective infrastructure and targeted energy-cost relief — including direct support, tax credits and compensation for indirect costs from the EU Emissions Trading System (ETS) — we are effectively asking European companies and their workers to compete with their hands tied behind their backs. > Unless Europe changes course immediately, we risk watching an entire > industrial backbone, with the countless jobs it supports, slowly hollow out > before our eyes. The impact is already visible. This year, EU27 chemical production fell by a further 2.5 percent, and the sector is now operating 9.5 percent below pre-crisis capacity. These are not just numbers, they are factories scaling down, investments postponed and skilled workers leaving sites. This is what industrial decline looks like in real time. We are losing track of the number of closures and job losses across Europe, and this is accelerating at an alarming pace. And the world is not standing still. In the first eight months of 2025, EU27 chemicals exports dropped by €3.5 billion, while imports rose by €3.2 billion. The volume trends mirror this: exports are down, imports are up. Our trade surplus shrank to €25 billion, losing €6.6 billion in just one year. Meanwhile, global distortions are intensifying. Imports, especially from China, continue to increase, and new tariff policies from the United States are likely to divert even more products toward Europe, while making EU exports less competitive. Yet again, in 2025, most EU trade defense cases involved chemical products. In this challenging environment, EU trade policy needs to step up: we need fast, decisive action against unfair practices to protect European production against international trade distortions. And we need more free trade agreements to access growth market and secure input materials. “Open but not naïve” must become more than a slogan. It must shape policy. > Our producers comply with the strictest safety and environmental standards in > the world. Yet resource-constrained authorities cannot ensure that imported > products meet those same standards. Europe is also struggling to enforce its own rules at the borders and online. Our producers comply with the strictest safety and environmental standards in the world. Yet resource-constrained authorities cannot ensure that imported products meet those same standards. This weak enforcement undermines competitiveness and safety, while allowing products that would fail EU scrutiny to enter the single market unchecked. If Europe wants global leadership on climate, biodiversity and international chemicals management, credibility starts at home. Regulatory uncertainty adds to the pressure. The Chemical Industry Action Plan recognizes what industry has long stressed: clarity, coherence and predictability are essential for investment. Clear, harmonized rules are not a luxury — they are prerequisites for maintaining any industrial presence in Europe. This is where REACH must be seen for what it is: the world’s most comprehensive piece of legislation governing chemicals. Yet the real issues lie in implementation. We therefore call on policymakers to focus on smarter, more efficient implementation without reopening the legal text. Industry is facing too many headwinds already. Simplification can be achieved without weakening standards, but this requires a clear political choice. We call on European policymakers to restore the investment and profitability of our industry for Europe. Only then will the transition to climate neutrality, circularity, and safe and sustainable chemicals be possible, while keeping our industrial base in Europe. > Our industry is an enabler of the transition to a climate-neutral and circular > future, but we need support for technologies that will define that future. In this context, the ETS must urgently evolve. With enabling conditions still missing, like a market for low-carbon products, energy and carbon infrastructures, access to cost-competitive low-carbon energy sources, ETS costs risk incentivizing closures rather than investment in decarbonization. This may reduce emissions inside the EU, but it does not decarbonize European consumption because production shifts abroad. This is what is known as carbon leakage, and this is not how EU climate policy intends to reach climate neutrality. The system needs urgent repair to avoid serious consequences for Europe’s industrial fabric and strategic autonomy, with no climate benefit. These shortcomings must be addressed well before 2030, including a way to neutralize ETS costs while industry works toward decarbonization. Our industry is an enabler of the transition to a climate-neutral and circular future, but we need support for technologies that will define that future. Europe must ensure that chemical recycling, carbon capture and utilization, and bio-based feedstocks are not only invented here, but also fully scaled here. Complex permitting, fragmented rules and insufficient funding are slowing us down while other regions race ahead. Decarbonization cannot be built on imported technology — it must be built on a strong EU industrial presence. Critically, we must stimulate markets for sustainable products that come with an unavoidable ‘green premium’. If Europe wants low-carbon and circular materials, then fiscal, financial and regulatory policy recipes must support their uptake — with minimum recycled or bio-based content, new value chain mobilizing schemes and the right dose of ‘European preference’. If we create these markets but fail to ensure that European producers capture a fair share, we will simply create new opportunities for imports rather than European jobs. > If Europe wants a strong, innovative resilient chemical industry in 2030 and > beyond, the decisions must be made today. The window is closing fast. The Critical Chemicals Alliance offers a path forward. Its primary goal will be to tackle key issues facing the chemical sector, such as risks of closures and trade challenges, and to support modernization and investments in critical productions. It will ultimately enable the chemical industry to remain resilient in the face of geopolitical threats, reinforcing Europe’s strategic autonomy. But let us be honest: time is no longer on our side. Europe’s chemical industry is the foundation of countless supply chains — from clean energy to semiconductors, from health to mobility. If we allow this foundation to erode, every other strategic ambition becomes more fragile. If you weren’t already alarmed — you should be. This is a wake-up call. Not for tomorrow, for now. Energy support, enforceable rules, smart regulation, strategic trade policies and demand-driven sustainability are not optional. They are the conditions for survival. If Europe wants a strong, innovative resilient chemical industry in 2030 and beyond, the decisions must be made today. The window is closing fast. -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is CEFIC- The European Chemical Industry Council  * The ultimate controlling entity is CEFIC- The European Chemical Industry Council  More information here.

BRUSSELS — European banks and other finance firms should decrease their reliance on American tech companies for digital services, a top national supervisor has said. In an interview with POLITICO, Steven Maijoor, the Dutch central bank’s chair of supervision, said the “small number of suppliers” providing digital services to many European finance companies can pose a “concentration risk.” “If one of those suppliers is not able to supply, you can have major operational problems,” Maijoor said. The intervention comes as Europe’s politicians and industries grapple with the continent’s near-total dependence on U.S. technology for digital services ranging from cloud computing to software. The dominance of American companies has come into sharp focus following a decline in transatlantic relations under U.S. President Donald Trump. While the market for European tech services isn’t nearly as developed as in the U.S. — making it difficult for banks to switch — the continent “should start to try to develop this European environment” for financial stability and the sake of its economic success, Maijoor said. European banks being locked in to contracts with U.S. providers “will ultimately also affect their competitiveness,” Maijoor said. Dutch supervisors recently authored a report on the systemic risks posed by tech dependence in finance. Dutch lender Amsterdam Trade Bank collapsed in 2023 after its parent company was placed on the U.S. sanctions list and its American IT provider withdrew online data storage services, in one of the sharpest examples of the impact on companies that see their tech withdrawn. Similarly a 2024 outage of American cybersecurity company CrowdStrike highlighted the European finance sector’s vulnerabilities to operational risks from tech providers, the EU’s banking watchdog said in a post-mortem on the outage. In his intervention, Maijoor pointed to an EU law governing the operational reliability of banks — the Digital Operational Resilience Act (DORA) — as one factor that may be worsening the problem. Those rules govern finance firms’ outsourcing of IT functions such as cloud provision, and designate a list of “critical” tech service providers subject to extra oversight, including Amazon Web Services, Google Cloud, Microsoft and Oracle. DORA, and other EU financial regulation, may be “inadvertently nudging financial institutions towards the largest digital service suppliers,” which wouldn’t be European, Maijoor said. “If you simply look at quality, reliability, security … there’s a very big chance that you will end up with the largest digital service suppliers from outside Europe,” he said. The bloc could reassess the regulatory approach to beat the risks, Maijoor said. “DORA currently is an oversight approach, which is not as strong in terms of requirements and enforcement options as regular supervision,” he said. The Dutch supervisors are pushing for changes, writing that they are examining whether financial regulation and supervision in the EU creates barriers to choosing European IT providers, and that identified issues “may prompt policy initiatives in the European context.” They are asking EU governments and supervisors “to evaluate whether DORA sufficiently enhances resilience to geopolitical risks and, if not, to consider issuing further guidance,” adding they “see opportunities to strengthen DORA as needed,” including through more enforcement and more explicit requirements around managing geopolitical risks. Europe could also set up a cloud watchdog across industries to mitigate the risks of dependence on U.S. tech service providers, which are “also very important for other parts of the economy like energy and telecoms,” Maijoor said. “Wouldn’t there be a case for supervision more generally of these hyperscalers, cloud service providers, as they are so important for major parts of the economy?” The European Commission declined to respond.

Europe’s far-right firebrands are rushing to hitch their fortunes to Washington’s new crusade against Brussels. Senior U.S. government officials, including Vice President JD Vance and Secretary of State Marco Rubio, have launched a raft of criticism against what they call EU “censorship” and an “attack” of U.S. tech companies following a €120 million fine from the European Commission on social media platform X. The fine is for breaching EU transparency obligations under the Digital Services Act, the bloc’s content moderation rule book. “The Commission’s attack on X says it all,” Hungarian Prime Minister Viktor Orbán said on X on Saturday. “When the Brusselian overlords cannot win the debate, they reach for the fines. Europe needs free speech, not unelected bureaucrats deciding what we can read or say,” he said. “Hats off to Elon Musk for holding the line,” Orbán added. Tech mogul Musk said his response to the penalty would target the EU officials who imposed it.  “The European Commission appreciates censorship & chat control of its citizens. They want to silence critical voices by restricting freedom of speech,” echoed far-right Alternative for Germany leader Alice Weidel. Three right-wing to far-right parties in the EU are pushing to stop and backtrack the integration process of European countries — the European Conservatives and Reformists, the Patriots for Europe, and the Europe of Sovereign Nations. Together they hold 191 out of 720 seats in the European Parliament. The parties’ lawmakers are calling for a range of proposals — from shifting competences from the European to the national level, to dismantling the EU altogether. They defend the primacy of national interests over common European cooperation. Since Donald Trump’s reelection, they have portrayed themselves as the key transatlantic link, mirroring the U.S. president’s political campaigning in Europe, such as pushing for a “Make Europe Great Again” movement. The fresh U.S. criticism of EU institutions has come in handy to amplify their political agendas. “Patriots for Europe will fight to dismantle this censorship regime,” the party said on X. The ECR group — political home to Italian Prime Minister Giorgia Meloni — issued a statement questioning the enforcement of the DSA following the U.S. criticism. “A digital law that lacks legal certainty risks becoming an instrument of political discretion,” ECR co-chairman Nicola Procaccini said on Saturday after the U.S. backlash. The group supported the DSA when it passed through the Parliament, having said in the past the law would “protect freedom of expression, increase trust in online services and contribute to an open digital economy in Europe.”

Elon Musk slammed the EU after it slapped a fine on his social media platform X for violating transparency rules, warning his response would target the top officials behind the penalty. “The ‘EU’ imposed this crazy fine not just on [X], but also on me personally, which is even more insane!” the billionaire Tesla CEO wrote on X. “Therefore, it would seem appropriate to apply our response not just to the EU, but also to the individuals who took this action against me.” The rebuke comes after the European Commission on Friday imposed a €120 million fine on Musk’s platform for breaching transparency obligations it faces as a very large online platform under the EU’s Digital Services Act, the bloc’s flagship content moderation law. The EU executive said the platform’s blue checkmark feature was deceptive after it was changed from denoting verified users into a paid feature. It also said X’s advertising library lacks transparency, and that it fails to provide access to public data for researchers. A Commission official said the executive has found three entities behind X; X Holdings Companies, xAI and Elon Musk “at the top.” Commission spokesperson Thomas Regnier said the fine is “for a breach committed by X” but “addressed to the entire corporate structure.” “The EU woke Stasi commissars are about to understand the full meaning of the ‘Streisand Effect,'” Musk fumed. The “Streisand effect” refers to when an attempt to keep something discreet backfires. Musk didn’t elaborate on what form his response to the X levy would take or which individuals he would target directly. The fine on X and its owner has already drawn a sharp rebuke from Washington, with U.S. officials depicting the bloc’s move as an assault on broader free speech rights, with some alleging that U.S. companies were being singled out. Vice President JD Vance criticized the fine after details leaked ahead of time. “The EU should be supporting free speech not attacking American companies over garbage,” Vance said. When asked about Vance’s remarks, the Commission’s Executive Vice President for Tech Sovereignty Henna Virkkunen told reporters: “The DSA is having not to do with censorship, this decision is about the transparency of X.”  Secretary of State Marco Rubio, in a Friday post on the platform, said the fine “isn’t just an attack on [X], it’s an attack on all American tech platforms and the American people by foreign governments. The days of censoring Americans online are over. Deputy Secretary of State Christopher Landau added to the criticism, saying that the “nations of Europe cannot look to the US for their own security at the same time they affirmatively undermine the security of the US itself through the (unelected, undemocratic, and unrepresentative) EU.” Trump’s EU envoy Andrew Puzder also slammed the penalty. The “excessive €120M fine is the result of EU regulatory overreach targeting American innovation,” Puzder wrote on X. “The Trump Administration has been clear: we oppose censorship and will challenge burdensome regulations that target US companies abroad. We expect the EU to engage in fair, open, & reciprocal trade — & nothing less.” The move adds another layer of tension to the EU’s strained relationship with the Trump administration, with the U.S. president threatening to impose additional tariffs on the bloc if it continues to penalize American tech giants. The topic has been a theme of tense trade talks in recent months, with the U.S. pushing Brussels to scrap the DSA, along with other enforcement measures. While the fine was cautiously praised in Brussels and other European capitals, where officials had worried that the EU executive would bow to demands that it rein in its enforcement of U.S. tech firms, some European politicians more aligned with the U.S. agenda joined in on the criticism. “Nobody elected you,” wrote far-right Dutch firebrand Geert Wilders. “You represent no one. You are a totalitarian institution and can’t even spell the words freedom of speech. We should not accept the fining of [X], but abolish the [Commission].” The fine was only the conclusion of the first part of the EU’s probe into X, which will also look at the content circulated on the platform. X did not immediately respond to request for comment.

BRUSSELS — European politicians expressed cautious praise as Brussels slapped a €120 million fine on Elon Musk’s X on Friday, despite American fury over the decision.  The reaction from national diplomats and lawmakers illustrated broad support as the EU finally crossed a Rubicon and issued its first fine under the EU’s rule book to rein in social media platforms, more than two years after it started its enforcement effort.  The divide between the reaction from European capitals and U.S. Vice President JD Vance — who slammed the move before it was announced — sets up a clash that is set to persist as Brussels turns its attention to more enforcement decisions under the Digital Services Act (DSA), and will likely spill into ongoing transatlantic trade talks. Friday’s decision “sends an important signal that the Commission is determined to enforce the DSA,” said Karsten Wildberger, Germany’s digital minister, during a meeting of EU ministers in Brussels. Polish Digital Minister Dariusz Standerski applauded it as a sign of “strong leadership.” After French President Emmanuel Macron last week expressed outspoken criticism of the EU for slow-walking the conclusions, his digital minister, Anne Le Hénanff, said Friday: “France fully supports this decision … which sends a clear message to all platforms.” She later described it as a “magnificent announcement.” Washington meanwhile was quick out of the gate to slam the move from Brussels, with Vance chiming in half a day before the fine was announced to describe it as a penalty “for not engaging in censorship.” He repeated the U.S. mantra of the past year that the EU’s DSA amounts to censorship and restricted speech. “Once again, Europe is fining a successful U.S. tech company for being a successful U.S. tech company,” said Brendan Carr, the chair of the U.S. Federal Communications Commission, in reaction to the decision. “Europe is taxing Americans to subsidize a continent held back by Europe’s own suffocating regulations.” “The only substantial meaningful fines that have been imposed so far have been against American companies,” Andrew Puzder, the U.S. ambassador to the EU, told Bloomberg Television. “So at some point, if you’re an American company, you’ve gotta sit back and say, look, am I being targeted here?” Asked for a response, the White House directed POLITICO to Vance’s earlier post. Much of the praise in Europe focused on the assessment that the EU didn’t bow to U.S. pressure, neither on the actual fine nor the enforcement steps — even if the move was seen as long overdue. “The Commission held the line,” said Felix Kartte, currently a special adviser to the European Commission.   “It’s important that the EU does not cave to pressure,” said Marietje Schaake, a former MEP and former Commission adviser.  “I am very pleased to see that the Commission is taking serious steps against the intolerable practices we encounter from some of the major tech platforms. Let’s have more of that!” said Danish digital minister Caroline Stage Olsen.  Several European Parliament lawmakers joined the praise but warned this is only the beginning, noting this is the first of several outstanding probes under the DSA, including others against X. Friday’s decision only concerned X’s transparency obligations; X still faces open probes over the spread of illegal content and information manipulation.  In total, 10 investigations into large platforms including Amazon, YouTube, Facebook and Instagram are still up in the air. “This is an important start, but not a breakthrough,” said German Greens lawmaker Alexandra Geese. “As long as the Commission fails to rule on the algorithms, the central level of manipulation remains untouched.”   French liberal lawmaker Sandro Gozi urged that “this long overdue decision must mark a step change,” while Danish Social Democrat Christel Schaldemose said she wanted “far greater transparency” on how the Commission enforces the DSA.  Speaking to reporters Friday, Commission digital chief Henna Virkkunen stressed repeatedly that this is only part of the investigation into X. Acknowledging the criticisms that the EU has been slow to reach this point, she promised that the next decisions would come quicker.   Other observers criticized the size of the X penalty. A fine of €120 million is seen as relatively modest compared to the €2.95 billion fine that Google got for antitrust issues under the bloc’s sister digital law, the Digital Markets Act.   “120m is no deterrent to X,” said Cori Crider, executive director at the Future of Technology Institute. “Musk will moan in public — in private, he will be doing cartwheels.”   “Yes, the fine may seem small,” acknowledged Kartte. The DSA law says fines will take into account “the nature, gravity, duration and recurrence of the infringement” and cannot exceed 6 percent of a company’s annual global turnover.  Commission officials refused to give a clear answer on how they came to the €120 million figure when pressed. A senior official repeatedly said the fine is “proportionate” to the infringement. But how it was calculated can’t be “drilled down to a simple economic formula,” they said. The official said the Commission has found three entities behind X; X Holdings Companies, xAI and Elon Musk “at the top.”   The fine is “for a breach committed by X” but “addressed to the entire corporate structure,” Commission spokesperson Thomas Regnier told reporters.   Based on estimates of company values, that means the upper threshold could have reached as high as €5.9 billion.

BRUSSELS — U. S. Vice President JD Vance has hit out at the EU’s digital rules enforcement, saying the EU should not be “attacking American companies over garbage.” “Rumors swirling that the EU commission will fine X hundreds of millions of dollars for not engaging in censorship. The EU should be supporting free speech not attacking American companies over garbage,” Vance wrote on X overnight. X owner Elon Musk immediately thanked the U.S. official, commenting, “Much appreciated.”  The European Commission opened formal proceedings against X under its Digital Services Act in December 2023, roughly a year after Musk bought Twitter and rebranded it as X. But the EU has yet to finalize its probe, after accusing X of breaching its obligations around transparency and blue checkmarks in preliminary findings in July 2024. A decision could come as early as Friday, according to media reports Thursday. Under the EU rules, companies can be fined up to 6 percent of their annual global turnover. French President Emmanuel Macron last week voiced concerns about the slow pace of Brussels’ probes into American tech giants, adding to a growing chorus of criticism that the bloc has been too slow to enforce its flagship Digital Services Act amid U.S. pressure. Washington has repeatedly asked the EU to roll back its digital rule book as part of trade negotiations, and last week U.S. Secretary of Commerce Howard Lutnick put this on the table again as an explicit exchange for scrapping tariffs on steel and aluminum in ongoing talks. Asked earlier Thursday how she feels about a looming diplomatic showdown if she slaps a fine on a U.S. tech giant, Commission digital chief Henna Virkkunen told POLITICO: “I’m quite calm in different situations. I’m not surprised about anything. I’m protecting our laws. But at the same time we are going to make Europe faster and simpler and easier for businesses.” Asked if she’s afraid of the U.S.’s reaction to a fine under the DSA, Virkkunen responded with a single word: “No.”

French President Emmanuel Macron said Brussels is too slow in its handling of probes into American Big Tech companies due to U.S. pressure over the EU’s digital laws. “We have cases that have been before the Commission for two years. It’s much too slow,” Macron said Friday in reference to the EU’s content moderation rule book, the Digital Services Act (DSA). The debate around the matter is “not gaining momentum,” Macron told a local town hall event in the Vosges region, and “many in the Commission and member states are afraid to pursue it because there’s an American offensive against the application of directives on digital services and markets.” Macron promised to push for action at the EU level, adding: “We have a geopolitical battle to fight. This is not Russian interference, it is clearly American because these platforms do not want us to bother them.” Macron’s remarks follow a week that saw renewed pressure from the U.S. over the EU’s two tech rulebooks, the DSA and the Digital Markets Act. U.S. Commerce Secretary Howard Lutnick urged EU ministers on Monday to “reconsider” the rulebooks in exchange for lower U.S. steel and aluminium tariffs, in line with the American playbook of treating the EU’s tech rules as a bargaining chip in a transatlantic trade war. The rules have been a target for the U.S. administration and tech executives ever since President Donald Trump returned to office. Both the EU’s tech chief, Henna Virkkunen, and her competition colleague, Teresa Ribera, came out against the U.S. pressure this week, with the latter accusing Washington of “blackmail.” The European Commission is also under pressure from European Parliament lawmakers, with the Socialists and Democrats group moving to set up an inquiry committee to investigate the EU’s enforcement of digital rules. Responding to Macron’s remarks, European Commission spokesperson Thomas Regnier said: “We have been very clear since the very beginning: We are fully behind our digital legislation and are enforcing it.” He argued that “some cases take a bit more time than others, because the DSA investigations are broad.” “The Commission services are building solid cases, because we have to win them in court,” he said. The EU has investigations open under the DSA into X, Meta, AliExpress, Temu and TikTok. The probes could lead to fines of 6 percent of a company’s annual global turnover, but none have been levied so far.

The European Commission did not follow the proper lawmaking procedure when it drafted a plan to cut red tape, the European Ombudsman office said in a damaging assessment released Thursday. The administrative watchdog — which has no enforcement powers — found “a number of procedural shortcomings” which “amount to maladministration” in how the Commission prepared several proposals to review EU rules on supply chain transparency, agricultural funding, and migration. It comes as the EU executive attempts to quickly pass a long list of legislative amendments to simplify rules for business and boost the bloc’s global competitiveness. The findings conclude three separate investigations launched by the Ombudsman, following complaints from civil society that the Commission was bypassing its own “Better Regulation” rules, which outline what steps the EU needs to take when drafting legislative proposals. “The Commission must be able to respond urgently to different situations, particularly in the current geopolitical context,” European Ombudswoman Teresa Anjinho said in a statement. “However, it needs to ensure that accountability and transparency continue to be part of its legislative processes and that its actions are clearly explained to citizens.” The Commission did not provide enough evidence to “justify the ‘urgency’ of the legislative proposals towards the public,” the Ombudsman conclusions state. It recommends that the EU executive be more transparent, evidenced-based and inclusive in its future lawmaking. The Ombudsman Office monitors whether the institutions are upholding transparency norms investigates complaints of poor administration by EU institutions.

BRUSSELS — The European Commission may act as sole enforcer of the EU’s Big Tech rules, but a settlement reached between Google and an Italian regulator demonstrates there is still plenty of room for its national counterparts to drive the agenda. The Italian Competition Authority disclosed on Friday that it had reached a settlement with the U.S. search giant to modify the design of its terms and conditions for users to consent to sharing their data. The investigation, which accused the tech giant of using “misleading and aggressive” commercial practices to get users to link services like Maps and Search, thus violating Italian consumer protection rules, struck at conduct that is also covered by the EU Digital Markets Act (DMA). While the DMA was designed to centralize digital enforcement in Brussels, it has not boxed out national regulators from pursuing Big Tech cases.  Responding on Monday, the Commission welcomed Google’s Italian settlement and said the changes it foresees would be rolled out EU-wide. “Google’s commitments are a good example of how the work of national authorities on consumer protection law complements the Commission’s enforcement of the DMA to achieve better results,” a Commission spokesperson said. “Google will change its consent screens to provide clearer, more accurate information — both about how Google combines and cross-uses personal data and what the implications of consent are for users.” 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 on Monday. Lutnick called for the bloc to “take the foot off this regulatory framework,” and held out the prospect of cooperation in other areas, like steel, in return. Washington’s main gripe is that the DMA, by design, targets the largest technology platform companies — and these are chiefly American. In addition, Google was recently fined nearly €3 billion in an antitrust case in which the EU’s trust busters found it had unfairly squeezed digital advertising customers. The search giant last week proposed a series of tweaks in response to the landmark antitrust decision, but snubbed calls to break itself up. CONTINENTAL PATCHWORK In the Commission’s ongoing review of the DMA, some tech sector stakeholders have raised concerns that this could recreate a patchwork of national rules that the regulation is supposed to harmonize. Google had argued to the Italian regulator that this issue should be handled by the Commission given its status as a gatekeeper, an argument that the Rome-based agency rejected citing jurisprudence that allows Italian consumer law to apply. 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 In its decision, the Italian Competition and Consumer Protection Authority said it had cooperated with the Commission on the case and engaged trilaterally on the remedies. The Italian regulator opened the case in 2024, shortly after the DMA came into effect, accusing Google of using misleading and aggressive commercial practices to get users to link services like Maps and Search. Google has now agreed to redesign the choice screen and prompt all of its Italian users to choose their data preferences once again. The broader design changes however will impact all European users. “Following coordinated discussions with the [European Commission] and [the Italian Competition Authority], we are making simple updates to our existing information screens we show users, to decide if they want to link our services,” said a spokesperson for Google. While the Commission has, to date, not specified its view on Google’s compliance with the DMA on data consent, the company’s solution has garnered criticism from consumer groups like BEUC for misleading users. In that vacuum, the Italians acted. Nor was it the first national agency to do so. Before the DMA came into effect, the German competition authority had intervened in Google’s data use policy on the basis of its national digital competition rules, leading to EU-wide remedies that saw DMA-like rules extended beyond designated services like Search to others like Gmail.

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.