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Global trade dynamics have become a defining factor for technology companies as they navigate an increasingly fragmented regulatory and economic landscape. The effects of 2025’s global economic reshuffle are still unfolding in 2026, with persistent geopolitical tensions, supply chain realignments and protectionism expected to further shape the technology sector.
Here’s what matters now and the crucial risk mitigation steps tech multinationals must take.
Technology companies’ crucial role in economic growth and national security makes them highly sensitive to changes in the geopolitical landscape and, in turn, to trade policies and tariffs.
Jennifer Revis, Global Head of Customs, London
The intersection of tariffs, trade and technology is exposing new chokepoints in tech supply chains, forcing multinational corporations to rethink risk and resilience.
Alison Stafford Powell, Partner, Palo Alto
The new trade realities
US tariffs and countermeasures
US import tariffs, and countermeasures taken by other countries, have prompted major technology companies to reassess their global footprints. In particular, manufacturers of technology devices and equipment are reconsidering their manufacturing operations’ locations and reconfiguring tech supply chains and sourcing strategies, as well as engaging in longer-term investment planning.
While global trade in 2025 remained largely resilient, the impact of US tariffs and countermeasures is expected to further materialize in 2026.
Export controls and sanctions
National security concerns, foreign policy and economic interests are increasingly blending and driving new non-tariff measures around emerging technologies and raw materials, such as restrictions on the exports of advanced semiconductors and critical minerals, including rare earths. Key components and inputs can become subject to increased administrative requirements and costs, as well as outright export bans, with little or no notice, disrupting carefully built supply chains overnight.
Traditionally, export controls are established through multilateral agreements among like-minded nations. However, with key countries such as Russia not participating and with increased fragmentation, over recent years, the growing trend has been toward more national measures, with the US and China particularly active. In Europe, Spain, the Netherlands and Italy — three EU member states — are among those countries that have also enacted national export controls on semiconductor production equipment and technology beyond EU requirements.
Such bespoke national export controls create a patchwork of divergent obligations for multinational companies that continue to evolve with geopolitical developments, as well as technological progress. The fluctuating sanctions landscape also adds complexity to the operations of tech multinationals, since many of them provide global services to multinational clients that may have differing obligations and risk appetites.
Foreign direct investment scrutiny
Foreign direct investment (FDI) regulations increasingly incorporate export control concerns. Proposed acquisitions that could result in the transfer of critical technologies to nations considered competitors in technological innovation and leadership, or even potential military adversaries, are subject to greater scrutiny, with an expanding regulatory landscape now encompassing both inbound and outbound investments.
How tech leaders should respond
Stay informed
The pace of change is rapid, and the impact can be unexpected, immediate and costly. Businesses should stay informed at all levels to be able to anticipate and assess the commercial and financial impacts. As a timely case in point, President Trump has imposed a multitude of tariff measures on a variety of countries and products, primarily relying on the authority of the International Emergency Economic Powers Act (IEEPA) and Section 232 of the Trade Expansion Act of 1962 (“Section 232”).
On 20 February 2026, after a lengthy court challenge, the US Supreme Court decided that the IEEPA does not confer power on the executive to impose tariffs. However, President Trump has several other tariff authorities that he can invoke to impose additional tariffs, and which he duly did following the Supreme Court’s decision. President Trump moved quickly to announce temporary special import measures with a 10% global tariff under Section 122 of the Trade Act of 1974, then saying he would increase it to 15%.
A number of trade deals followed the IEEPA and Section 232 tariff announcements. These include, for example, the US-UK Economic Prosperity Deal, the US-EU trade deal and the US China Framework Trade Agreement. However, these deals essentially set basic principles, with the precise details of the agreements to be determined and are now further complicated by uncertainty surrounding the impact of the IEEPA tariffs being ruled unlawful. Countries are likely to continue to negotiate and review provisions of implementing agreements, such as the EU Commission’s proposals and implementation of the US-EU trade deal still to be implemented by the European Parliament.
Suspended export control measures could also be reinstated. The BIS Affiliates Rule, which was issued on 29 September 2025 to introduce a 50% ownership flow-down rule into the Export Administration Regulations (“EAR”), was suspended as of 10 November 2025 for one year as part of the US-China agreement. This rule is due to be reinstated at the end of the suspension period but could be revisited sooner if trade deal discussions break down or are further extended or even modified.
On the AI front, the White House’s AI Action Plan unveiled on 23 July 2025 and the Executive Order on the same day on “Promoting the Export of the American AI Technology Stack” did not offer a replacement to the AI Diffusion Rule that the Trump administration announced would be rescinded. It did, however, offer some indications of what might come next in this area, such as creative approaches to export control enforcement, collaboration to prevent diversion and full stack export.
Stay agile and be prepared to address potential policy shifts
Companies should map out and monitor their supply chain flows top to bottom, identify potential chokepoints and vulnerabilities and update risk management frameworks in anticipation of further policy shifts. Businesses should monitor their import and export volumes in the US and elsewhere, broken down by products and current tariff rates, enabling quick assessment of tariff impacts.
To prepare for possible BIS Affiliates Rule reinstatement and further entity listings in the meantime, firms should refresh diligence of existing, cleared counterparties and consider mapping their exposure for targeted further action.
While the landscape is fluid, companies should be accelerating, not delaying, contingency planning.
Chandri Navarro, Senior Counsel, Washington, DC
Adopt comprehensive supply chain strategies
If products are impacted by existing or potential future tariffs, it may be possible to change the supply source or key production location through restructuring business operations. However, non-preferential rules of origin generally require substantial transformation.
Additionally, these types of business restructurings typically have various tax, regulatory, other trade and legal implications. Multiple layers of regulations and other criteria need to be considered as part of the planning process, as well as the associated costs. The global scale and sophisticated supply chains of many technology companies make this process particularly challenging, but this assessment may also help identify potential incentives and efficiency gains. In the current landscape, a company’s readiness to strategically accept short-term efficiency losses for longer-term gains in resilience may be a key differentiator.
Another possibility to mitigate tariffs is to identify product changes that may result in an alternative and more favorable Harmonized Standards (HS) classification or country of origin. It is important that any such re-classification or change in origin of products be defensible.
Other mitigation strategies should be considered based on potential impacts, for example, unbundling transfer prices or applying alternative customs valuation methods to optimize customs values (see our blog on this topic). Additionally, the use of customs procedures such as free trade zones, temporary importation under bond, duty drawback and bonded warehousing may also be explored.
Accurate tariff classification is essential for compliance and is more relevant than ever due to the implementation of tariffs, retaliatory duties and increased customs enforcement.
Patrick de Lapérouse, Associate, Washington, DC
Challenge existing assumptions and engage in scenario planning
Many multinational technology companies, specifically those involved in hardware manufacturing, are increasingly accustomed to reassessing their operations. However, import tariffs, export controls, sanctions and foreign investment policies have the potential to directly, or indirectly, impact technology companies in other sectors of the industry. Trade policy volatility also impacts unexpected areas.
Necessary components and equipment for communications and digital infrastructure projects may become more expensive. Customs and tariffs issues may also affect services-oriented technology companies, due to their involvement in manufacturing activities and physical movement of goods through subsidiaries, acquired companies or associated activities. Geopolitical tensions, sanctions and export control restrictions can also affect customers and providers’ choices for cloud infrastructure and data center locations. It can also impact the viability of these projects for investors and operators.
Scenario planning and updates based on ongoing monitoring of the environment should be incorporated into standard business planning processes to facilitate continuous adjustments and compliance, where contracting agility will be crucial.