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UK Could Weaken Online Censorship Law To Avoid US Trade Battle

London weighs free speech against trade as Washington pressures Labour to amend online censorship laws.

Starmer in a suit and glasses is sitting in front of a blurred Union Jack flag.

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As European leaders scramble to shield their economies from impending US tariffs, the UKโ€™s Labour government appears ready to make significant concessions. Facing the risk of economic fallout, Prime Minister Keir Starmerโ€™s administration has reportedly signaled to Washington that it is open to revising the controversial and dangerous Online Safety Act โ€” legislation critics have described as an aggressive censorship regime.

The Act, which gives UK regulators the power to fine tech companies for failing to remove vaguely defined โ€œharmful content,โ€ has been a major point of contention between the two allies and has become a major threat to free speech online. The Trump administration has been especially vocal in its opposition, viewing the law as an affront to free speech and a potential financial burden on US tech giants.

According to The Telegraph:

โ€œDowning Street is willing to renegotiate elements of the Act in order to strike a trade deal, should it be raised by the US, The Telegraph understands. The law has been heavily criticized by free speech advocates and economists, who argue its broad provisions to tackle harmful online content could lead to excessive censorship and deter investment from American tech giants.โ€

The Online Safety Act arms UK media regulator Ofcom with sweeping new authority over social media platforms, enabling the imposition of multimillion-pound fines for failing to police content according to government directives. While supporters claim the law is necessary to protect users, critics argue that its vague wording and punitive approach encourage preemptive censorship โ€” where platforms remove lawful content simply to avoid regulatory punishment.

President Donald Trumpโ€™s return to the White House has intensified scrutiny of the law. The president, who has been highly critical of social media censorship, has surrounded himself with influential voices in the tech world, including Elon Musk, whose platform, X, is already preparing to challenge Ofcomโ€™s authority.

โ€œAnother source close to the Trumpโ€™s (sic) administration suggested the act was viewed as โ€˜Orwellianโ€™ in the US and could become a flashpoint in negotiations. โ€˜To many people that are currently in power, they feel the United Kingdom has become a dystopian, Orwellian place where people have to keep silent about things that arenโ€™t fashionable,โ€™ they said. โ€˜The administration hate it [Online Safety Act]. Congress has been saying that [it is a concern] ever since it was enacted. Those in the administration are saying the exact same thing.โ€™โ€

Musk has publicly condemned the Act, and with Ofcom set to gain new enforcement powers in March, tensions between US tech firms and the UK government are likely to escalate. The entrepreneur recently welcomed Trumpโ€™s presidency as a potential counterweight to the UKโ€™s regulatory crackdown.

Free speech advocates on both sides of the Atlantic have long warned that Britainโ€™s approach to online regulation represents a stark departure from the First Amendment protections enjoyed in the US. The Free Speech Union and groups like the Electronic Frontier Foundation (EFF) argue that the lawโ€™s restrictions on โ€œharmful but legalโ€ speech will lead to widespread content suppression, limiting open debate and investigative journalism.

Lord Young of Acton, the founder of the Free Speech Union, underscored the looming confrontation between UK regulators and US tech leaders:

โ€œIf that happens, Trump will side with his tech bros and tell Sir Keir that if he wants a trade deal, heโ€™ll call off his dogs.โ€

Labour has previously doubled down on online regulation, with its election manifesto promising additional measures to โ€œkeep everyone safe online.โ€ However, in the face of potential US trade repercussions, the governmentโ€™s stance appears to be softening.

From Washingtonโ€™s perspective, the Online Safety Act has become an obstacle to trade negotiations, raising concerns that UK regulatory overreach could deter American investment. Andrew Hale, a trade policy expert at the Heritage Foundation, confirmed that this issue has been a recurring theme in discussions with US officials.

โ€œEvery meeting I have to discuss trade policy with people either in the administration or Congress, they always raise that. They say, โ€˜This is a huge roadblockโ€™.โ€

With Ofcomโ€™s enforcement powers set to take effect soon, Britain faces a fundamental choice: cling to its stringent online censorship policies or prioritize economic cooperation with the US. The decision could shape the future of free speech in the UK for years to come.

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