FIRST ON FOX: A nonprofit organization that advocates for the protection of free markets is urging the U.S. Treasury Department not strike any trade or investment agreements with Latin American countries unless they block digital taxes or regulations that would undermine U.S. companies.
Public Policy Solutions sent a letter to Treasury Secretary Scott Bessent Tuesday claiming that protectionist measures seen in Europe that unfairly target U.S. companies are spreading to Central and South American countries — amid concerns that Latin America is imposing a similar framework as Europe, which has imposed taxes and fines on U.S. companies that provide digital services.
Protectionist measures in tech policy impose regulatory restrictions or other limitations on foreign companies.
Public Policy Solutions also unveiled a new report to accompany its letter to Bessent, titled “European-Style Digital Hostilities Infecting the Western Hemisphere: America’s Backyard is Becoming a Testing Ground for Regulatory Nightmare.”
“A growing number of Latin American countries are exploring or implementing digital services taxes, data-transfer regulation, innovation-killing AI legislation modeled on the EU, and competition frameworks that disproportionately burden U.S. firms,” Public Policy Solutions Co-founder and president Joe Grogan said in the letter.
“Some of our closest trading partners, including Brazil, Colombia, and Chile, have advanced or enacted measures that resemble Europe’s Digital Markets Act, Digital Services Act, and other punitive European-style regulatory frameworks,” Grogan said. “These policies risk replicating in our own hemisphere the same distortions that have undermined fair competition in Europe.”
The European Union’s Digital Markets Act identifies and imposes additional regulations on seven so-called “gate-keepers” of information, including Alphabet, Amazon, Meta and Microsoft. Meanwhile, six of the companies targeted are U.S., one is Chinese, and none are European, according to a report Public Policy Solutions published in June.
The Digital Services Act seeks to crack down on illegal content and misinformation. However, groups like Public Policy Solutions who are critical of the law have asserted that it restricts free speech and claim it imposes more harsh rules on larger companies. Fifteen of the 19 companies that qualify as a very large online platform (VLOP) are based in the U.S., and Public Policy Solutions have claimed that this unfairly targets U.S. companies.
TRUMP CALLS FOR FEDERAL AI STANDARDS, END TO STATE ‘PATCHWORK’ REGULATIONS ‘THREATENING’ ECONOMIC GROWTH
If a company doesn’t comply with regulations in the Digital Markets Act, fines are imposed. In April, the European Commission announced that it would slap a €200 million — amounting to more than $232 million in U.S. dollars — fine upon Meta for violating the law, claiming Meta failed to provide consumers options to use less personal data.
Meta did not immediately respond to a request for comment from Fox News Digital.
Meanwhile, the group claims that U.S. companies receive more stringent punishments, in comparison to their Chinese counterparts for similar violations. For example, the group pointed to a $1.3 billion fine that the EU imposed on Meta in May 2023 for sending data from European users to the U.S., while Chinese-based TikTok only faced a $600 million fine in May for sending European user data to China.
But now, the group is worried that Central and South American companies are adopting a similar playbook as Europe and also are unfairly targeting U.S. companies amid ongoing trade negotiations with the Trump administration.
TRUMP NATIONAL SECURITY BLUEPRINT DECLARES ‘ERA OF MASS MIGRATION IS OVER,’ TARGETS CHINA’S RISE
For example, Chilean prosecutors leveled an antitrust lawsuit against Google in May, where they sought to slap on $89 million in penalties for alleged market dominance. The lawsuit came after Chile passed a law in 2024 that sought to regulate data collection by tech companies and cross-border data transfers, according to Public Policy Solutions. Under Chile’s new law, each violation faces a $1.4 million penalty.
Additionally, Brazil is in the middle of considering legislation that the group claims is modeled after the Digital Markets Act that would establish regulations for digital markets for certain companies. Unlike the “gatekeeper” designation in the Digital Markets Act, the proposed Brazil measure establishes a minimum revenue threshold that translates to roughly $14 million U.S. dollars, which would ultimately subject hundreds of tech companies to these regulations, according to the Center for Strategic and International Studies.
Meanwhile, Public Policy Solutions is also concerned with Latin America’s ties to China in the technology space. While the first Trump administration outlawed the use of Chinese technology company Huawei and partially Chinese state-owned technology company ZTE for U.S. government workers and contractors, amid national security concerns in 2018, Latin America has become more dependent upon Huawei.
For example, Public Policy Solution’s new report claims that Huawei’s business in Latin America increased by 9% from 2021 to 2022, and the U.S. Institute for Peace reports that Huawei is working with every large mobile and internet service provider in Latin America.
Likewise, the report noted that Brazil’s National Telecommunications Agency revealed in 2024 that Huawei holds more than 44% share of 5G infrastructure in Brazil.
The U.S. is actively engaged in trade talks with a host of countries currently, including Chile, Brazil, El Salvador, Guatemala and Argentina.
AMERICA MUST WIN THE AI RACE — AND PREPARE FOR THE WORST
As a result, Public Policy Solutions is calling on the Trump administration to crack down on those who engage in discriminatory digital policies that negatively impact U.S. companies, and that any future trade and investment agreements block digital taxes or regulations that “discriminate against American innovators.”
Likewise, the group is urging the Trump administration to “withhold new partnerships or initiatives” from allied governments — until they move to restrict CCP-linked access to sensitive data systems.
“For far too long, the European Union has used a protectionist regulatory approach to the United States to use American tech and telecommunications companies as an ATM while shielding their own firms from competition,” Grogan said in a statement to Fox News Digital.
“We now see those same misguided and unfair tactics being adopted by countries in our own backyard,” Grogan said. “Our latest report highlights the danger of Latin American countries taking a page out of the European playbook, driving a wedge in our key economic and security relationships. Meanwhile they roll out the red carpet for an adversarial and unreliable partner: China.”
Read the full article here
