Trump Admin Is Right to Use Section 301 to Counter the EU’s Discriminatory Tech Rules, Says ITIF

WASHINGTON-Following President Trump's announcement that the administration plans to initiate a Section 301 investigation to retaliate against the EU's discriminatory digital practices, the Information Technology and Innovation Foundation (ITIF), the leading think tank for science and technology policy, released the following statement from Rodrigo Balbontin, associate director of trade, IP, and digital technology governance:

President Trump's announcement that the administration is initiating a Section 301 investigation puts Brussels on notice that discriminatory attacks against U.S. technology firms will not stand. This retaliatory measure follows a letter from 25 House members urging the White House to act. Yet it seems that EU policymakers either don't listen or don't care. The United States has long said that Europe must cease and desist from discriminatory policies such as the Digital Markets Act. But the EU has continued levying resource-extractive fines such as its recent decision targeting Alphabet, and its general approach to targeting U.S. companies has not changed-a clear sign the message has not gotten through.

Until now, the hope had been that a Section 301 investigation alone would serve as a deterrent and prompt the EU to eliminate discriminatory features of the DMA, such as its reverse-engineered gatekeeper thresholds, which overwhelmingly capture U.S. firms.The more likely scenario from this point forward is that the administration will use its Section 301 authority to selectively retaliate rather than just imposing blanket tariffs that would ultimately backfire and harm American producers. Policymakers should carefully study options to avoid self-defeating and unintended effects. These measures could include a targeted tax policy on EU companies, tariffs in non-tech sectors such as luxury goods, and exploring interventions in other areas such as foreign investment or space policy.

Contact: Austin Slater, [email protected]