The 'big bazooka': How Europe could hit the U.S. tech industry if the Greenland trade war blows up

"If it does, leaders in European capitals have looked at what levers are available to pull to try and dissuade the U.S. president from moving toward more aggressive action. Some of the most significant U.S. exports are its tech apps, services, and platforms, putting them first in the firing line. U.S. social media platforms, for instance, account for more than a third of the entire value of the S&P-meaning any impact on them could be deleterious to the broader American economy."

"Within Brussels, the hub of European legislative decision-making, there has been discussion of how to bring some of the U.S.'s more outlandish ideas into line with the global order, says Zach Meyers, director of research at the Center on Regulation in Europe, noting, "Since they mostly provide services rather than physical products, reciprocal tariffs would not work." The European Union could use what has been described as its "big bazooka": the so-called Anti-Coercion Instrument."

"That's "specifically designed to deter and address this type of geopolitical bullying," says Meyers, and includes "a huge menu of other restrictions on how Big Tech [companies] operate in Europe, such as limitations on exploiting IP rights, on being able to compete in public procurement, and constraining incoming investment.""

An apparent agreement to placate Donald Trump's interest in Greenland leaves unresolved details and the risk that a nascent trade dispute could resume. European capitals are identifying levers to dissuade the U.S. president from aggressive action, focusing on major U.S. exports in tech apps, services, and platforms. U.S. social media platforms represent over a third of the S&P's value, so harm to them could damage the American economy. EU institutions have considered that reciprocal tariffs would not work for services, and have the Anti-Coercion Instrument, described as a big bazooka, to restrict Big Tech through IP limits, procurement bans, and investment constraints. European leaders have hesitated to deploy harsh measures to avoid escalating geopolitics.

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