The United States has threatened countermeasures against the EU over the bloc's efforts to tax American firms, pointing to major European companies as potential targets.
But the European Union swiftly vowed to keep enforcing its tech regulations "without discrimination."
In a social media post, the U.S. Trade Representative's (USTR) office criticized the EU and certain member states for their "continuing course of discriminatory and harassing lawsuits, taxes, fines, and directives" against American service providers.
It warned that if the bloc and its members pressed on with moves deemed to deter the competitiveness of U.S. companies, Washington "will have no choice but to begin using every tool at its disposal to counter these unreasonable measures."
The post also signaled that key European businesses could be targeted in response, listing Accenture, DHL, Mistral, Siemens and Spotify among others.
"Should responsive measures be necessary, U.S. law permits the assessment of fees or restrictions on foreign services, among other actions," the USTR said.
It added that Washington would take a similar approach to other countries that pursue an "EU-style strategy in this area."
Thomas Regnier, a spokesman for the European Commission, however responded that "as we have made clear many times, our rules apply equally and fairly to all companies operating in the EU."
"We will continue to enforce our rules fairly, and without discrimination," he said.
The U.S. statement also sparked pushback from Luther Lowe, head of public policy at startup accelerator Y Combinator.
Lowe called the move "a disappointing betrayal of 'little tech,'" adding that the EU's Digital Markets Act helps unlock market share for U.S. firms.
President Donald Trump has previously lashed out at the European bloc over its regulation of U.S. tech firms, and the USTR's statement marks a further attempt to put pressure on Brussels.
Trump threatened retaliatory tariffs in September after the bloc slapped Google with a $3.47 billion antitrust fine.
Earlier this month, the U.S. leader also criticized a "nasty" $140 million fine by the EU against tech tycoon Elon Musk's X social network. He warned that "Europe has to be very careful."
Tensions will likely continue to simmer, with Google, Microsoft and Amazon recently facing further scrutiny by authorities in Brussels.
The USTR post argued that American companies have provided "substantial free services" to EU citizens and "reliable enterprise services" to companies.
It also said that EU service providers, in turn, had been able to "operate freely" in the United States.
Trump's pushback against countries that he says are targeting US tech firms has prompted some changes elsewhere.
In June, Canada said it would rescind its digital services tax, which would have hit U.S. tech giants, after Trump said he was ending trade talks with Ottawa.
