US ambassador warns EU risks exclusion from AI economy over Big Tech fines

The United States ambassador to the European Union, Andrew Puzder, has delivered a blunt ultimatum to Brussels: ease up on the regulation and fines targeting American technology giants, or accept exclusion from the artificial intelligence economy that will define the next decade. Speaking to CNBC on Friday, Puzder argued that the very companies the Commission has been penalising, Meta, Apple, Google and X, are the ones that own the data centres, the training data and the advanced semiconductor supply chains without which Europe cannot build a competitive AI sector.

A year of escalating enforcement

The ambassador's intervention follows twelve months in which the European Commission has unleashed its most aggressive wave of enforcement against US platforms since the General Data Protection Regulation took effect in 2018. In April 2025 the competition directorate fined Meta 200 million euros over its advertising model and, in the same month, hit Apple with a 500 million euro penalty related to App Store rules. September brought a 2.95 billion euro fine against Google for alleged abuse of dominance in online advertising technology. In December, X was ordered to pay 120 million euros for failures under the Digital Services Act (DSA).

The pace has not slackened in 2026. In February the Commission warned Meta that it intends to impose behavioural remedies to reverse changes to WhatsApp's AI integration policy. On Thursday, 26 March, it announced formal proceedings against Snapchat, owned by Snap, to determine whether the platform complies with DSA obligations on child safety. Each case rests on a different legislative pillar, the Digital Markets Act, the Digital Services Act, competition law, but the cumulative effect is a regulatory environment that Washington now characterises as discriminatory.

The AI dependency argument

Puzder's core contention is structural rather than legal. Europe's ambition to be a global AI player, he says, runs on infrastructure it does not control. The most advanced graphics processing units are designed by Nvidia and manufactured by TSMC; the largest hyperscale data centres are operated by Amazon Web Services, Microsoft Azure and Google Cloud; the most valuable training datasets are held by the very platforms now under investigation. "You know the very companies that can bring you the data, the data centres and the American AI hardware stack," Puzder told CNBC. "If you regulate them off the continent, you're not going to be a part of the AI economy."

The argument finds some resonance among European industry groups. The European Digital SME Alliance has previously warned that compliance costs for the DMA and DSA fall disproportionately on smaller European firms, while the large American incumbents can absorb fines as a cost of doing business. But the Commission's counter-argument is that market power, not nationality, determines enforcement priorities. Teresa Ribera, the Executive Vice-President responsible for competition, stated in 2025 that "all companies operating in the EU must follow our laws and respect European values." Her office points out that European companies such as Booking.com and Spotify have also faced DMA scrutiny.

Washington's coordinated pushback

Puzder's remarks are not isolated. They form part of a coordinated diplomatic offensive by the second Trump administration. Secretary of State Marco Rubio went further than the ambassador, labelling the X fine an "attack on all American tech platforms and the American people by foreign governments" in a post on X itself. The language signals that the White House views digital regulation as a trade issue, not merely a regulatory one. USTR Katherine Tai's office has reportedly been assessing whether the DMA's designation criteria, which capture only firms above certain revenue and user thresholds, all of them currently American, constitute a de facto tariff on US services exports.

The transatlantic trade relationship is already strained by disputes over steel, aluminium and electric vehicle subsidies. Adding digital services to the list of retaliatory targets would raise the stakes considerably. The EU runs a substantial surplus in digital services with the United States, but US firms dominate the platform layer. A breakdown in data transfer agreements, such as the EU-US Data Privacy Framework, would hurt both sides but would be immediately catastrophic for European firms reliant on US cloud infrastructure.

The Snapchat case as a test

The Snapchat investigation opened on Thursday illustrates the Commission's willingness to extend DSA enforcement beyond the very large online platforms (VLOPs) initially designated in 2023. Snapchat was not on the original VLOP list; the Commission is using its powers to investigate systemic risks to minors, a priority that has grown since the European Parliament's 2024 resolution on child protection online. If the case results in a fine or behavioural order, it will confirm that the DSA's reach extends to any service with significant European user bases, regardless of size tier.

For Snap, the timing is awkward. The company has been cutting costs and refocusing on augmented reality advertising after a difficult 2024. A prolonged DSA proceeding adds legal uncertainty at a moment when investors are questioning the monetisation trajectory of social media platforms that are not named Meta or TikTok. The Commission has not indicated a timeline for the investigation, but DSA proceedings typically run 12 to 18 months before a preliminary finding.

European strategic autonomy versus regulatory sovereignty

The deeper tension is between two European ambitions: strategic autonomy in critical technologies, and regulatory sovereignty over the digital single market. The Chips Act, the EuroHPC joint undertaking, and the AI Factories initiative are all attempts to build indigenous compute capacity. Yet the first EuroHPC exascale machine, Jupiter, relies on Nvidia GPUs and SiPearl processors built on Arm architecture, both foreign-controlled supply chains. The AI Factories call, launched in 2025, explicitly invites proposals that leverage existing commercial cloud partnerships, which in practice means US hyperscalers.

European policymakers are aware of the contradiction. In private, several national digital ministers have acknowledged that the DMA and DSA were designed assuming a more pluralistic platform market than exists today. The hope was that European alternatives would emerge once gatekeeper power was constrained. So far, that has not happened at scale. The most successful European consumer platforms, Spotify, Klarna, Delivery Hero, operate in niches, not as general-purpose infrastructure.

What happens next

Three tracks will determine whether Puzder's warning translates into policy change. First, the Commission's own review of the DMA, due in 2027, could adjust designation thresholds or compliance requirements. Second, the Trade and Technology Council (TTC), dormant for much of 2025, is scheduled to reconvene in June 2026; digital enforcement is on the agenda. Third, the US Congress is considering legislation that would authorise retaliatory tariffs against countries deemed to discriminate against American digital firms, a measure that would force the Commission to calculate the cost of its regulatory purity in lost market access for European exporters.

For now, the two sides are talking past each other. Brussels sees a legal order that applies equally to all; Washington sees a trade barrier dressed in regulatory language. The irony, as several officials on both sides of the Atlantic privately acknowledge, is that Europe's regulatory power derives precisely from the size of its market, a market that American firms have no intention of leaving, fines or not. The question is whether the accumulated weight of compliance costs, behavioural remedies and reputational damage eventually tips the calculus for a chief executive deciding where to site the next data centre or deploy the next foundation model. That decision, when it comes, will be made in Silicon Valley, not in Brussels.