The UK will surrender its right to set its own tech laws. Will the EU follow?
On the sidelines of Donald Trump's unprecedented second state visit to the UK today, he will sign a tech pact with Keir Starmer that trades sovereignty for US investment.
The United Kingdom is rolling out the red carpet for US President Donald Trump today, making good on Keir Starmer’s invitation during his grovelling White House visit in February. A second state visit is an honour never extended to any US president before. Trump will be escorted in a royal carriage heralded by three separate military bands and escorted by riders on horseback to Windsor Castle to meet King Charles III, after having already met Charles’ mother during his first term. Last month Trump claimed that European leaders jokingly told him he’s now the “President of Europe.” It’s unclear if Starmer was one of those leaders, but Trump sure does seem to be cosplaying as the King of England at the moment. And with the way UK and EU leaders have been prostrating themselves before him, his characterisation may not be far from the truth.
On the sidelines of this visit, Starmer and Trump will sign a “technology pact” which says that the American big tech companies will make significant investments in rolling out their technologies across Britain. It is only a few pages long, but its implications could be profound. Because in exchange for the investment, it is implicit that the UK will roll back the UK technology regulations (laws meant to protect citizens) that the American big tech companies and the US government have been railing against for the past months.
Just look at the people who will be joining Trump in his entourage, and the powerful forces behind this pact become clear. OpenAI’s Sam Altman, Blackstone’s Stephen Schwarzman and Nvidia’s Jensen Huang will all be with Trump in London. Nvidia is expected to announce an investment in Britain’s biggest data centre planned for Blyth in Northeast England, while Blackstone is expected to announce a partnership with OpenAI for a project being touted as the “British Stargate”.
Starmer has already signalled that he is willing to change UK tech law to suit Washington’s interests, and the pact seems to make this a foregone conclusion. Though he has defended the UK’s Online Safety Act and the Digital Services Tax that has come in for particular criticism from America, he has gone quiet on them of late as the pact paves the way for their dissolution. Gaia Marcus, director of the Ada Lovelace Institute think tank, told Politico this week that what’s being described as an investment pact could actually be a submission to tech vassalage. "The public deserves to understand who really benefits from these partnerships and what the return will be for taxpayers in years to come," she said. "We mustn't just focus on what the figures look like today, if the cost is technological lock-in tomorrow, limiting our ability to seek alternatives in the future."
Even more worrying, White House sources have said that the intent here isn’t just to get a veto over the UK’s tech laws, but also to “expand the US-UK relationship as a means to counterbalance the EU - and I think that’s a big part of this trip.”
A person briefed on the agenda for Trump’s visit told Politico that in exchange for the investment pact the US will be looking “to see some sort of support from the UK” against the pieces of EU legislation the US is most concerned about: the Digital Markets and Digital Services Acts, the CSDD supply chain disclosure reporting standard, and the AI Act.
While the technology pact doesn’t specifically mention any piece of regulation, the quid pro quo is clear. That has several British lawmakers very worried. “The UK needs to take decisions that are in its long-term strategic interest; true technology sovereignty cannot mean being dependent on one investor or country,” Chi Onwurah, chair of the House of Commons Science, Innovation and Technology Committee, told Politico.
Will the EU cave on tech regs?
As the UK goes clearly down the path of vassalisation (and with barely a peep of objection from the British media), with the US intending to weaponise it against the neighbouring EU, it is an open question whether the EU will follow suit in changing its laws. The signs so far have not been promising. EU Commission President Ursula von der Leyen’s humiliating trade war surrender to Trump in Scotland over the summer, which followed European leaders rushing to obey a non-sensical spending demand from Trump at NATO in June, has not given people much hope that she’s going to stand up for Europe. Nor have the actions of the EU’s national leaders from whom she takes her instructions.
But for the moment at least, the Commission is insisting that they will not bend to US demands that they change EU tech legislation. It’s a message President von der Leyen repeated in her State of the European Union speech to parliament last week. “I want to be crystal clear on one point: Whether on environmental or digital regulation - we set our own standards, we set our own regulations. Europe will always decide for itself.” However she didn’t name who was trying to decide for Europe.
As the US government has attempted to intimidate the EU from setting tech laws that would impact US companies operating in Europe (something that began with the Biden administration but became more aggressive with Trump), calls have been growing across the EU for “tech sovereignty”. The European Parliament is drafting a report that would force the Commission to map out all of the many tech dependencies it has on the United States and come up with a plan for lessening them.
Earlier this year, the so-called “Digital Nine” (now D9+) grouping of small-to-medium EU countries who banded together in 2016 to resist the efforts of big EU member states to set more regulations on American big tech suddenly changed their tune. The members - Denmark, Finland, Sweden, the Netherlands, Luxembourg, Belgium, Spain, Ireland, Estonia, Czechia, Poland and Portugal - describe themselves as “pro-tech advocates of an open digital economy”. But the declaration adopted at their summit in Amsterdam in March struck a suddenly different note, endorsing the principle of “tech sovereignty” and saying Europe “needs to strengthen its technological capabilities as well as trade relations.” These were the same voices who just two months earlier were defending JD Vance’s scolding of Europe’s attempts at tech sovereignty at the AI Summit in Paris.
“In a rapidly changing world order, characterised by a global race for technological dominance, digital competitiveness and tech sovereignty in an open manner are crucial enablers of economic and geoeconomic strength,” the declaration states. “All this is essential for Europe's competitiveness, economic security and its stature as a geopolitical actor.”
But here’s the rub: The Trump regime clearly views the trade pact signed in Scotland as an EU promise to start consulting on how they will change their tech laws in order to suit Washington’s demands. Even as the Commission insisted, following the Scotland deal at the end of July, that the deal did not in any way signal an openness to reopening the laws, the White House put out a “fact sheet” claiming the exact opposite. Members of the Trump administration were also contradicting the Commission’s claim.
In response, the Commission scrambled to put out its own memo insisting that it had done no such thing. The EU will retain its "right to regulate autonomously,” Olof Gill, the Commission's spokesperson for trade, said on 29 July in response to the White House's claims. "We're not moving on our regulations. We're not moving on our rules. We're not moving on the system that we built up over many decades that our citizens trust,” he said. "That will not form part of this agreement with the US."
Yet the EU-US joint statement fleshing out the details of the deal, put out at the end of August and signed by both sides, says that Brussels has pledged to address “unjustified digital trade barriers,” and has committed to “not adopt or maintain network usage fees” as had been planned. A Q&A statement released by the Commission after that joint statement was published makes no commitment on sticking to the EU’s digital laws as they were passed, though it also still insists, “the Joint Statement does not include any commitment on EU digital regulations.”
But it’s hard to trust the Commission’s assertions that they will not reopen EU tech laws (which were just passed in the previous two years) when they have just been on the losing side of a trade war surrender. It is especially hard to believe it when the joint statement explicitly says, “the European Union commits to undertake efforts” to adjust four pieces of climate and transport legislation.
Yesterday Matinale Europeenne wrote that President von der Leyen will face a series of key tests this Autumn to see if she is serious about defending Europe’s tech sovereignty.
“The Apple, Meta, and X platforms are in the crosshairs of the DMA (Digital Markets Act) and the DSA (Digital Services Act). And the Trump administration is exerting increasing pressure to prevent Europe from imposing restrictions on stablecoins (digital tokens), in which the American president's family has a direct interest. Some fear that the proposed Omnibus Digital Simplification Package—which the Commission is due to present by the end of 2025—will become the Trojan horse of digital deregulation, as demanded by American ‘Tech Bros.’
…In the coming weeks, two other cases concerning the DMA rules are due to be decided by the Commission. In April, the Commission fined Apple and Meta €500 million and €200 million respectively. Apple was ordered to remove restrictions preventing customers from redirecting users to alternative offers outside the App Store. Meta, for its part, was ordered to modify the "consent or pay" model (concerning the processing of personal data) to offer users a less personalized alternative. Both companies were given a 60-day deadline, or face a daily fine.
According to our sources, Apple is actively cooperating and moving in the right direction. Meta, on the other hand, is not making enough of an effort. The Commission's DMA enforcement services are inclined to propose a new fine against Meta to force it to modify its "Consent or Pay" system. Will von der Leyen and her commissioners have the courage? For now, it has been decided to give Meta more time, given its relationship with the Trump administration. This indicates the von der Leyen Commission's lack of determination to impose European digital sovereignty, regardless of political considerations.”
They also mention the Omnibus simplification package for the digital sector due to be proposed in December. “According to our sources, the AI Act (the law on artificial intelligence) will be seriously amended by the Digital Omnibus. This is what the Trump administration, but also some Member States, are demanding. Will Virkkunen at least defend the DMA and DSA, the two key regulations? "The Omnibus could be the Trojan horse to dismantle the DMA and DSA," warns an EU official. Even the GDPR (General Data Protection Regulation) risks losing some protections in the Omnibus simplification process.
But the omnibus, just like any other attempt to tear up EU legislation that has already been passed into law, will need the consent of a European Parliament that is keen on tech sovereignty. As I noted in comments to the National Journal in Washington earlier this month, the biggest impediment to the EU adjusting its tech rules at Washington’s command likely won’t be the courage of EU leaders but rather the onerous legislative process necessary to change them. MEPs will likely be the only thing standing between EU leaders and the erosion of citizens’ digital protections. But MEPs have a poor track record when it comes to not giving in to Commission and Council pressure.
If past is prologue, few people in Brussels have a high degree of confidence right now that the EU won’t bend to Trump’s whims, regardless of what the EU president may have said in her state of the union speech.