UK

President Trump has threatened the UK with significant tariffs on British goods if it does not repeal its digital services tax. The 2% tax, enacted in 2020, targets revenue from U.S. tech giants like Google and Meta. Trump called the tax opportunistic and vowed retaliation, while the UK government defended it as a crucial fiscal tool. This dispute adds to trans-Atlantic trade tensions.

The UK is actively seeking to deepen ties with AI company Anthropic, contrasting with the US which sanctioned them for refusing to compromise on ethical AI guardrails. London aims to be a welcoming regulatory environment, offering proposals like a dual stock listing to attract Anthropic. This move highlights the UK’s strategy to position itself as a balanced leader in AI governance, valuing ethical development while fostering innovation, and competing for global AI talent.

The UK is piloting social media restrictions for hundreds of teenagers, testing curfews and time limits. This follows a failed ban proposal for under-16s. The initiative is part of a broader digital wellbeing consultation. Similar regulatory actions are occurring internationally, with Australia and Spain already enacting bans, and France considering one. Large-scale scientific trials are also underway to assess social media’s impact on adolescent mental health.

The UK’s CMA has designated Google with “strategic market status” for its search and advertising services after a nine-month investigation, granting the regulator new powers to potentially reshape Google’s operations. The CMA is concerned Google’s dominance may stifle competition and innovation, potentially requiring fairer search rankings and increased transparency. Google acknowledges the designation, but cautions against overly restrictive regulations that could hinder innovation and growth, especially in AI. The CMA’s move balances promoting competition and fostering an environment for investment, while Google emphasizes its contribution to the UK economy.

Nvidia and OpenAI are reportedly in talks to invest billions in UK AI infrastructure, collaborating with cloud firm Nscale. An announcement could coincide with President Trump’s UK visit. This reflects a global trend of nations seeking partnerships with US AI leaders for “sovereign AI” development. Nvidia CEO Jensen Huang previously praised the UK as an investment hub. The investment aims to diversify geographic presence and capitalize on AI demand while providing OpenAI access to talent and a supportive regulatory environment.