In a sweeping gesture of transatlantic tech diplomacy, Microsoft President Brad Smith reaffirmed the company's commitment to European regulation. Addressing Brussels, Smith announced Microsoft "has long respected and complied with European laws—even when we've lost cases in European courts." The visit is taking place against a backdrop of higher levels of regulatory scrutiny and tensions between the United States and the European Union.

The remarks came after the European Commission had charged hefty fines, fining Apple €500 million and Meta €200 million over violations of the Digital Markets Act (DMA). The response by former U.S. President Donald Trump came by way of a threat to use retaliatory tariffs, terming the EU action as "overseas extortion."

Steering clear of US Tech Lobbying

Microsoft took a different approach to the more confrontational approach taken by some American companies and politicians. While the White House has labeled the EU's regulatory approach as anti-U.S. technology, Smith reacted tactfully. "We understand that European regulations govern our business practices in Europe, just as local regulations govern in the United States," he wrote in introducing Microsoft's five digital commitments to Europe.

One of the greatest advantages of this proposal is Microsoft's alignment with the DMA, which is intended to foster fairness, transparency, and accountability in the digital environment. The company's reaction to the Microsoft Digital Markets Act response is being read far and wide as an attempt to lead by example and position itself as a reliable digital partner in Europe.

Massive Infrastructure Investment to Underpin Commitments

Backing its talk with action, Microsoft announced it would grow its European cloud infrastructure. Over the next two years, it will add 40% datacenter capacity in 16 countries in Europe. It will have over 200 datacenters in the region by 2027—a total investment of tens of billions of dollars.

This growth is not just a business strategy—it's also Microsoft's effort to be part of the European digital fabric. "We are not only dedicated to building digital infrastructure for Europe, but to respecting the role that European laws play in governing our products and services," Smith emphasized.

Maintaining Sovereignty and Securing Information

One of the highlights of the Microsoft Digital Markets Act response is a pledge of European digital sovereignty. Smith promised that if Microsoft is ever requested by a foreign government to temporarily suspend services in Europe, it will "immediately and vigorously challenge such action."

To further promote confidence, Microsoft has launched a new "European Digital Resilience Commitment." It will be legally binding and included in agreements with national governments and the European Commission, thus offering confidence and legal certainty.

A Bridge, Not a Battleground

Smith ended by saying, "We are at a moment in time when business needs to be a bridge across the Atlantic." By doing so, he was framing Microsoft as a stabilizing presence in the face of increasing transatlantic tensions.

Microsoft Digital Markets Act response can ultimately become an example for global technology businesses to operate in regulatory-heavy ecosystems without tension. By positioning itself in alignment with European values and legal systems, Microsoft is not just defending its business interests but also increasing its profile as a responsible technology leader.