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The transatlantic technical team negotiates on China issues, but avoids facing key issues –

Although the United States and the European Union announced a broad technology and trade alliance on Tuesday (June 15) in response to Beijing’s technological rise, they failed to resolve the crux of the bilateral digital economy.

The two sides said in the joint summit communique: “We plan to cooperate on the development and deployment of new technologies based on our common democratic values, including respect for human rights, and encouraging compatible standards and regulations.”

The leaders also pledged to “closely consult and cooperate” on “their respective similar multi-faceted approaches to China, including elements of cooperation, competition, and systemic confrontation,” which also covers human rights violations.

EU and US officials agreed that China’s rise in technological power has created a sense of urgency for cooperation in technology and digital trade.

“The United States and the European Union share the same values ​​in terms of privacy, protection and democracy, and an open society, which means we need to jointly develop technology-related’rules of the road’,” Gina Raimondo, U.S. Secretary of Commerce Tell EURACTIV after the summit.

According to Raimondo, one of these areas may be emerging technologies such as cloud computing, artificial intelligence, network security or surveillance technology.

“The cooperation between the European Union and the United States is very important for employment growth and national and economic security. These standards are in line with and in line with our common values. Frankly speaking, China and other authoritarian regimes will not set’rules of the road’,” Raimundo said.

Raimondo added that since emerging technologies rely on semiconductors, it is very important for the United States and the European Union to strengthen their supply chains to counter China’s dominance.

However, the two sides still need to resolve bilateral issues on the issue of digital economy.

New Technology Agency

The leaders agreed to establish a new high-level EU-U.S. Trade and Technology Committee (TTC), which will establish an EU-U.S. working group around artificial intelligence, cybersecurity, competitiveness, data governance, and technology platforms to develop trans-Atlantic standards and Dominate the ever-increasing power of big technology.

One of the main goals will be to “promote cooperation in regulatory policies and law enforcement, and promote integration where possible.”

However, it is expected that the TTC can focus mainly on market access rather than achieving regulatory convergence, because the two groups have very different approaches, and artificial intelligence is an example.

“Given the decentralized nature of U.S. regulation, you will never see this [European] Principle-based regulation in the United States-In the United States, you can expect regulation on product safety, such as specific artificial intelligence applications,” Fredrik Erixon, director of the European Center for International Political Economy (ECIPE), told EURACTIV.

Erixon warned that because privacy and data regulation are very sensitive issues and are at the core of the digital economy, regulatory convergence on both sides of the Atlantic may never happen.

Erixon added that any convergence “will be based on some kind of bottom-up change, not a large global agreement.”

No data transmission breakthrough

The EU-US privacy protection agreement on international data transmission was rejected by the European Court of Justice for the second time last year, because the US surveillance laws were deemed not to meet GDPR-level protection.

The Commission and the US government are currently negotiating a new framework agreement, but EU leaders seem to doubt that if Washington does not change its surveillance practices, the new privacy provisions can withstand judicial review.

It is unclear whether the new US government has any plans to change its national security laws.

The summit did not bring about the diplomatic breakthrough that many technology companies hoped for, because the final statement contained only a broad commitment to “work together to ensure safe, reliable, and credible cross-border data flows to protect consumers and strengthen privacy protection.” “

Antitrust and Internet tax

In recent weeks, Washington has seen an antitrust push because the US Congress has been enacting some bipartisan laws and the large technology critic Lina Khan has been appointed as the chairman of the Federal Trade Commission.

“The United States is increasingly worried that Europe now has the wrong impression of what the new government wants to do. Just because it wants to have a fairly strong competitive agenda with large American technology companies, it does not mean that it accepts that Europe can adjust. Regulations affect American companies rather than European companies.” Erickson added.

Potential tensions still exist on the taxation front.

“Even though they may have some common principles in corporate taxation, when you dive into the details, you will realize that when these taxes are applied to large technology companies, the two parties are actually not very close,” Eric Sen said.

The European corporate income tax system proposal only targets technology companies and believes that foreign sales should be taxed in the revenue-generating market. Americans accept it as a general principle and therefore require it to be applied to all international companies.

For Erixon, “This will be a problem for some countries that have come forward, including France and Germany. Most large European companies are concentrated in these countries.”

In contrast, the United States, as a net importer, may see an increase in its taxes.

[Edited by Benjamin Fox]

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