That tool, typically labelled the “bazooka” in the EUs trade arsenal, was established primarily as a deterrent option to avoid coercive economic practices by major trade partners such as China or the US.
The instrument allows for a broad range of options including restricting the operation of third countries’ services in the European market, but features a burdensome process designed to facilitate dialog first and ensure the control of member states.Over the weekend, France already suggested one response could be regulating the use of data by big American tech platforms.
Habeck spoke in Luxembourg before a meeting of EU trade ministers. Comments from his Austrian counterpart chimed with that approach, with Wolfgang Hattmannsdorfer saying that while negotiations are the “top priority,” taxes on tech companies would be an option if should such talks were to fail.
Similarly, Spain’s Carlos Cuerpo left the door open for such action.
“We need to find the right balance in our response at this point and need again to be cool headed,” Cuerpo told Bloomberg Television. “First, it is a message of, of course lines are open, we want to negotiate. But in case we are not able to actually reach that point, we are ready to enter into using our instruments, which go as you know from the tariffs to a wider set of instruments that could also reach other elements, not only goods.”
The region’s ministers are attempting to narrow their differences over countering Trump’s escalating tariff war, which has ravaged global markets.
Poland’s Michal Baranowski, who is chairing the meeting, highlighted the need for urgent talks with the US.
“It’s very clear that there will be no winners in this confrontation,” he said. “So far the approach that we have seen is perhaps a little bit too much shoot first, talk later. I hope that we can switch to negotiations as soon as possible, serious negotiations with the United States because again, the transatlantic economic relationship is the biggest one in the world.”
With no sign that the US president might back down, the bloc may explore concessions, even as it works to finalize retaliatory steps to strengthen its hand at the negotiating table and be ready to hit back if talks fail. Part of the problem is that the Trump team doesn’t know what it wants, EU trade chief Maros Sefcovic told envoys Friday in a closed-door meeting.
Some European officials are concerned a tit-for-tat trade conflict is unavoidable, and some EU capitals view the deployment of the anti-coercion tool as premature.
Lithuanian foreign affairs minister Kestutis Budrys said the bloc musn’t “rush to use it” and Artjoms Ursulskis of Latvia said that services shouldn’t be targeted.
Among grounds for such doubts are the view by EU officials and diplomats that the basis is lacking to consider US tariffs as coercion, which would provide the legal grounds to trigger the instrument, people familiar with the matter said.
