EU and Korea seal digital trade deal

BRUSSELS — The European Commission and South Korea agreed a digital trade deal on Monday that will slot into their existing free-trade agreement, with EU trade chief Maroš Šefčovič calling it “nothing short of a major milestone.”

The deal amounts to a vote of confidence from Seoul in how the EU regulates tech and e-commerce, and comes as U.S. President Donald Trump appears likely to launch a trade war on Brussels. One target that Trump’s political allies and U.S. Big Tech have in their sights is the bloc’s digital rulebook, which they view as an unfair market barrier.

“Politically, it’s an important signal,” a Commission source said ahead of the announcement, referring to the EU’s push to diversify its foreign trade as the $1.7 trillion transatlantic commercial relationship with America deteriorates.

“There might be more like-minded countries for the EU to work with than you would have thought,” added the source, who was granted anonymity to speak freely. The EU has racked up accords in recent months, including with the Mercosur bloc of South American countries and with Mexico — and wants to do a free-trade deal with India this year.

Šefčovič announced the agreement in Brussels after meeting with Korean Trade Minister Cheong In-kyo.

In comments to reporters, he emphasized the importance of the digital deal as efforts to head off a transatlantic trade escalation stall.

Although the European Union’s “doors are open,” the United States “does not seem to be engaging to make a deal” to avoid a tariff war ahead of the planned reimposition of U.S. tariffs on steel and aluminum on Wednesday.

“We jointly identified the few areas that would allow us to move forward by fostering a mutual benefit. But in the end, one hand cannot clap,” Šefčovič said.

The trade commissioner also placed a call with his Thai counterpart on Monday, ahead of a round of negotiations on a trade deal later this month. And he namechecked ongoing talks with Indonesia, Malaysia, the Philippines and partners in the Middle East to deepen commercial ties.

Digital dealings

Digital trade deals cover data flows, security around personal data, and business-enabling technologies such as digital contracts.

In the Commission’s words, the Korean deal will “build consumer trust; ensure predictability and legal certainty for businesses, as well as trusted data flows; while removing and preventing the emergence of unjustified barriers to digital trade.”

President Yoon Suk-yeol was impeached in December and arrested in January after controversially declaring martial law last year. | Chung Sung-Jun/Getty Images

It’s significant in light of the political crisis in South Korea.

President Yoon Suk-yeol was impeached in December and arrested in January after controversially declaring martial law last year. Yoon awaits judgment after a court completed hearings last month.

Prime Minister Han Duck-soo, who was seen as attempting to obstruct Yoon’s impeachment, was impeached himself, leaving Finance Minister Choi Sang-mok in charge of the presidency and the prime minister’s office.

Šefčovič and Cheong met in Brussels on Monday for the annual EU-Korea Trade Committee that oversees implementation of the broader trade agreement, which dates back to 2011.

The two sides began discussing the deal in the fall of 2023, right after the EU announced it had reached such an agreement with Japan. Digital issues were not included in the trade negotiations with Japan and Korea because the EU at the time was working on its landmark GDPR privacy legislation.

Šefčovič also said the EU wants to close a similar deal with Singapore in the next few months.

The EU has already made similar data rules part of agreements with trade partners such as New Zealand and the U.K.

This story has been updated.