| Hey all, it's Natalia in Brussels. Days after U.S. antitrust authorities took a swipe at Facebook Inc. as part of broader crackdown on tech giants, Silicon Valley is facing a fresh regulatory blitz from a different long-time adversary: Margrethe Vestager. On Tuesday, the European Union digital czar and her team will propose far-reaching rules that could hit American tech giants with hefty fines, and in some extreme cases, order the companies to break apart their European units. The regulations are some of the strictest to target the tech industry that Brussels has yet introduced. Under one set of rules, the EU's new Digital Markets Act, companies deemed to be so-called "gatekeepers" could face fines of as much as 10% of annual revenue for offenses including treating their own services more favorably in rankings, among others. A company that has repeatedly breached the rules could face orders to divest businesses. Another set of regulations published on Tuesday, the EU's Digital Services Act, could impose fines of up to 6% of revenue for tech companies that fail to take down illegal content, or don't adhere to other regulations such as carrying out reviews of systemic risks to their sites. The U.K., which left the bloc earlier this year, also announced similar rules on Tuesday. The EU rules are still a long way from becoming law (they still need to be agreed upon, and likely amended, by the European Parliament and the bloc's member states), but they could test the relationship between Washington and Brussels. The EU's proposals come at a time when the bloc is looking to reset ties with the U.S. and the incoming administration of President-elect Joe Biden, after difficult years under the Donald Trump presidency. The two powers have clashed over taxing technology giants, trade and data flows—all issues that will likely remain points of contention even after Biden is sworn in. The EU has even proposed a plan to create "a specific dialogue" with the next U.S. administration on those issues, as well as the "responsibility of online platforms and Big Tech." But while both Republicans and Democrats in the U.S. are pushing for a tougher line against tech giants, those same ideas are likely to be less well received by U.S. politicians if they come from a foreign regulator like Vestager. As with past regulatory issues in Europe, the tech giants will likely enlist the help of U.S. officials to lobby for their cause. It's possible they'll even find allies in people who used to work at their companies who have since been named to Biden's transition team. The U.S. was allegedly successful in helping water down the text of the EU's privacy laws before they were proposed, and American officials have already taken a firm stance against the tax penalties for Apple Inc. that were ordered by the EU. It's still too early to say how the U.S. will respond to Vestager's latest volley. Biden's administration may be strategic in any reaction to the EU's sweeping tech plans, particularly as it looks to enlist the help of allies in Europe and elsewhere to check the rising economic power of China. The U.S. could decide that China, not its tech giants, may be the more important battle. —Natalia Drozdiak | 
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