Microsoft would push back against Trump order to suspend European cloud operations

BRUSSELS — Microsoft said Wednesday it will retain the option to sue if it is ordered to suspend European cloud operations amid concerns that services could get caught up in a transatlantic trade war.

During an event in Brussels, Microsoft President Brad Smith addressed growing European concerns that using U.S. cloud services is a risk. Some have suggested that the Trump administration could order U.S. companies to pause operations for EU customers, as retaliation in the trade war or if the EU continues to enforce its tech regulation.

Such event is “exceedingly unlikely” to happen, Smith said, but said the company acknowledges it’s “a real concern of people across Europe.”

The company will add a binding clause to its contracts with European governments and the European Commission stating that it would keep the option open to go to court in the event other governments ordered it to suspend or cease cloud operations, it said in a blog post.

“People want to know that there’s more than words that we’re offering, that’s why we’re prepared to back this up with contractual commitments,” Smith said.

The company based in Redmond in Washington is one of the leading cloud providers in Europe through its Microsoft Azure service.

The move came as Microsoft promised to build out its data center capacity on European soil. It said it plans to expand its European data center capacity by 40 percent over the next two years and expand operations in 16 European countries.

The plans are a welcome commitment for the EU. The European Commission has said it wants to triple the EU's data center capacity over the next five to seven years, as part of a larger plan to keep up in the global artificial intelligence race.

Training AI models requires vast amounts of computer power and data storage capacity.

Speaking in Brussels, Smith struck a conciliatory tone at a time when the U.S. administration and other U.S. tech executives have launched a full-frontal attack on some of the EU’s tech rulebooks.

“We understand that European laws apply to our business practices in Europe, just as local laws apply to local practices in the United States,” Smith said in a blog post, referring to European competition law and the EU’s new digital competition rulebook, the Digital Markets Act.

He added that Microsoft wants to be a “voice of reason,” promoting “stable” ties across the Atlantic.

Microsoft’s pitch could be on a collision course with a growing movement pushing for a European tech infrastructure and calls by European governments to build a sovereign cloud.

This story has been updated.