The arrest of Telegram co-founder and CEO Pavel Durov in Paris over the weekend has shocked the world. Although charges have yet to be filed, media reports suggest that the warrant was issued for Durov as part of an inquiry into “fraud, drug trafficking, organised crime, promotion of terrorism and cyberbullying” on the platform. These are extremely serious crimes, and the tech CEO stands accused of knowingly failing to prevent them.

The damage that this could do to France’s image in the eyes of the technology and entrepreneurial communities is profound. Shaun Maguire, a partner at Sequoia Capital, raised a counterfactual question, posting online: “The year is 1994 and Vint Cerf and Rob Kahn [sic] have just been arrested. Their invention (TCP/IP) is being used for drug dealers to communicate with each other and they were unwilling to install a back door.”

What Maguire’s tweet suggests is not simply that France is playing fast and loose with free speech, but that the French state’s position on technology is now such that it might bring serious criminal charges against people who develop communication platforms. The takeaway is straightforward enough: the tech community should avoid France and view it as akin to authoritarian countries such as China when considering doing business there.

It seems likely that the United States was made aware of Durov’s arrest before it was announced publicly. It also seems likely that Washington understands how France undermining its image amongst tech entrepreneurs is good for America: French engineers and entrepreneurs now have every incentive to migrate to the United States, where they are protected by the rule of law. Indeed, while the European media was playing up nefarious activity on Telegram, the New York Times was running stories framing the Durov arrest as part of the debate around freedom of speech. The Americans are preparing the ground to become a bastion of business freedom as Europe sinks into the sea.

Europe is already destroying its international competitiveness in its manufacturing sector through sanctions and counter-sanctions on Russian energy. Now, it seems, securocrats in the European bureaucracies want to turn the continent into a place where technologists fear the creation of platforms that allow for communications. They will no doubt soon move to ban Telegram and greatly restrict access to Twitter/X. Those who want to thrive outside of such a stifling environment will leave, and the cream of European entrepreneurship may soon cross the Atlantic.

Near the start of his presidency, Emmanuel Macron announced that he wanted to make France a “startup nation”. What happened to this optimism? Like much in Europe, it has collapsed into paranoia in the wake of the Ukraine War. In June, the Ukrainian media claimed that Russian intelligence agents were using Telegram and Tiktok to recruit saboteurs in Europe, just one among a litany of stories that accuse Telegram of undermining security on the continent. We do not yet know for certain if these reports fed into the decisions of French lawmakers to arrest Durov, but it seems likely they did.

There is always a trade-off between freedom and security. For the same reason, there is often a trade-off between entrepreneurship and security. That France has decided to prioritise security over freedom and entrepreneurship bodes very badly for the future of Europe. Creative minds will now look across the Atlantic for opportunity — and America will welcome them with open arms. In this regard, the United States appears to have snatched victory out of the jaws of defeat in Ukraine. Europe, meanwhile, has tied itself to the mast of a sinking ship.

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Philip Pilkington is a macroeconomist and investment professional, and the author of The Reformation in Economics

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