EU-US Trade Deal Stalls Over Digital Rules Dispute

The European Union's efforts to protect its Digital Services Act (DSA) have become a major obstacle in finalizing a joint trade statement with the United States, delaying formalization of a deal reached in July. The DSA, which mandates major tech companies to remove illegal content and take responsibility for harmful online material, is viewed by the EU as critical for a safer online environment, but U.S. officials argue it imposes costly compliance burdens and restricts free expression, especially affecting American tech firms. The U.S. has sought to keep open the possibility of concessions on the DSA within the trade talks, whereas the European Commission considers weakening the legislation a red line. The July agreement reduced tariffs on most EU goods to 15 percent, averting a broader trade war between the two economic powers, who together represent nearly a third of global commerce. Disagreements over language related to "non-tariff barriers," a category that includes the EU’s digital rules, are reported as primary reasons for the hold-up in issuing the joint statement. Both EU and U.S. officials have yet to publicly comment on the ongoing dispute.