EU prepares retaliatory measures against US tech, banks over Trump's mega tariffs

The European Union is gearing up to retaliate against the United States as President Donald Trump plans to impose reciprocal tariffs on all of America's trading partners.

This marks a significant escalation in the ongoing trade war, with the EU now considering countermeasures targeting US tech giants and major banks, a shift from its previous approach of matching tariffs on industrial goods, Caliber.Az reports citing foreign media.

European Commission President Ursula von der Leyen emphasized Europe’s strong position in the trade dispute, stating, “We will approach these negotiations from a position of strength. Europe holds a lot of cards. From trade to technology, to the size of our market. But this strength is also built on our readiness to take firm countermeasures. All instruments are on the table.”

The EU's new stance could include punitive measures against US services, including large financial institutions like J.P. Morgan or tech companies such as Google, Amazon, or Elon Musk's social network X. A senior EU official revealed, “We are certainly not excluding a bigger response, a better response and an even more creative response through services, through [intellectual property rights].”

While the EU enjoys a trade surplus of $50 billion in goods, it is a net importer of services from the US, which gives it a strategic advantage in the dispute. Experts note that pushing too far could provoke Brussels to impose taxes on US tech companies or tighten regulatory measures on Wall Street. Tobias Gehrke, a senior policy fellow at the European Council on Foreign Relations, commented, “America may wield the bigger stick, but Europe has plenty of sharp stones to throw.”

The EU has already begun preparing retaliatory tariffs, with plans to target $26 billion in US exports. However, the Commission is exploring broader responses that go beyond goods, including tightening regulations on Big Tech and potentially limiting the access of American firms to EU public contracts.

Options also include taxing financial transactions or imposing levies on digital flows. “The problem with the digital part is that the moment the EU does that, the pressure from the US on the regulatory framework will even increase,” warned Arnoud Willems, an international trade partner.

Should these measures fail to resolve the issue, the EU could invoke its "Anti-Coercion Instrument," allowing for a wide-ranging response, such as restricting US companies’ access to European markets. As one EU official explained, “These things are in principle … possible, for example, under the Anti-Coercion Instrument.”

Despite the threats, Brussels remains hopeful for negotiations. EU Trade Commissioner Maroš Šefčovič aims to establish a framework for talks with US counterparts, focusing on potential concessions like reducing duties or softening some regulations. However, EU businesses are cautious about escalating tensions, warning that such actions could harm European interests as well.

By Vafa Guliyeva