The EU is considering hitting US services exports, including Big Tech’s operations, to retaliate against Donald Trump imposing 25 per cent tariffs on the car industry, according to Financial Times
A fightback could include restrictions on the intellectual property of Big Tech companies.
The bloc has wide powers to suspend intellectual property rights and exclude companies from public procurement contracts under its Enforcement Regulation, which was strengthened in 2021 after a trade conflict with the first Trump administration.
Any retaliatory measures taken by the EU would be drawn up by the commission but must be approved by a weighted majority of member states.
“The Americans think that they are the ones with escalation dominance [in the trade war], but we also have the ability to do that,” said one EU diplomat, adding that the aim was ultimately to de-escalate with a comprehensive trade deal.
“Services is where the US is vulnerable,” a second diplomat said. Washington ran a €109bn trade surplus with the EU in services in 2023, compared with a €157bn deficit in goods.
“If you don’t want to target energy, there’s a limit to what can be done on goods. Whereas on services there is greater room for retaliation without so much harm to the economy.”
I=6 EU Commission preliminarily finds Meta in breach of transparency obligations; potential fine up to 6% of annual turnover
EU Commission said its preliminary findings indicate Meta breaches its obligation to grant researchers adequate access to public data under the Digital Services Act (DSA).
It also said that Meta doesn’t appear to provide users with a user-friendly and easily accessible mechanism to flag illegal content.
The Commission said Meta Platforms now has the possibility to examine its findings and take measures to remedy the breaches.
If the Commission’s views are confirmed, it can impose a fine of up to 6% of Meta’s annual global turnover as well as periodic penalty payments to enforce compliance.
Meta spokesperson Ben Walters said they disagree with the Commission’s findings and are confident that the changes they have introduced match what is required under the law.
Assessment
Based on my revenue estimate of $195.2 billion for Meta Platforms in 2025, a 6% DSA fine would equate to around $11.7 billion. However, the European Commission’s €200 million DMA fine against Meta (for violations between March and November 2024) suggests that actual penalties tend to be far below the legal maximum.
Moreover, the Digital Markets Act (DMA) provides for stricter sanctions (up to 10% of global turnover, or 20% for repeat offences). As such, the DMA appears the stronger enforcement instrument.
Given that the DSA mainly targets transparency and risk-management obligations rather than structural changes to core business models, its implications for Meta are likely modest in both operational and financial terms.
Also, based on the progress of DMA discussions, the EU Commission and Meta are likely to find a common ground that doesn’t cause significant headwind for Meta.
I=5 Zuckerberg and Meta Platforms settles shareholder Cambridge Analytica lawsuit for $190 million
CEO Zuckerberg and Meta Platforms agreed to settle shareholder Cambridge Analytica lawsuit for $190 million, paid from an insurancy policy.
The shareholders who were seeking $7 billion compensation claimed that Meta Platforms directors overpaid when it settle the Cambridge Analytica lawsuit for $5 billion to protect Zuckerberg from personal liability.
The deal also requires Meta to improve its governance policies, including not retaliating against employees who point out privacy missteps.
I=6 IRS is seeking $16bn from Meta by challenging profits booked in Ireland before 2020
IRS is seeking $16bn from Meta by challenging profits booked in Ireland, escalating a decade-long dispute tied to a 2010 IP licensing structure.
The IRS is using a rare and untested “periodic adjustments” approach, reallocating profits based on what Meta actually earned later, not what was expected in 2010.
Similarly, a prior Tax Court ruling already favored Meta on tax calculations and Meta is challenging the validity of the IRS regulations themselves, complicating the IRS’s case and signaling that the dispute could take several years.
Meta unwound the Irish arrangement in 2020, hence the tax dispute relates to prior years.