Trump orders ban on DEI policies for European companies serving the US government

April 4, 2025

The Trump Administration has issued a letter to several major EU-based companies, urging them to comply with an executive order prohibiting DEI programmes, FT reports.

The letter said that President Donald Trump's executive order applied to companies outside the US if they were suppliers or service providers to the American government and that they were required to confirm their compliance.

It said that Department of State contractors must confirm they don’t run any DEI programmes that violate anti-discrimination laws. They must agree that this confirmation is important for the government’s payment decisions and is therefore covered by the False Claims Act.

The False Claims Act is a US federal law that holds federal contractors liable for defrauding government programmes by misrepresenting their obligations to the government.

However, initial legal assessments suggest that the extraterritorial action may not be enforceable, leading some executives and their advisers to decide not to respond at this time.

The documents seem to suggest that the Trump administration is broadening its campaign against DEI to include foreign companies, following its crackdown on DEI policies domestically.

In February, 18 Republican finance officials ordered leaders of the Securities and Exchange Commission and Department of Labor to prohibit asset and retirement plan managers from considering ESG or DEI factors in investment decisions.

Certain companies have also faced increased pressure to scrap DEI policies since Trump’s inauguration. BlackRock, Goldman Sachs, JPMorgan Chase, Bank of America, Citigroup and Morgan Stanley were warned of potential legal action over their DEI policies.

Meanwhile, shareholders of Apple and Costco rejected a proposal from The National Center for Public Policy Research, which called for the companies to abandon their DEI goals.

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