Eight European Union nations including Britain, Ireland and Poland have urged caution with regulating the internet as Brussels prepares a sweeping review of the behaviour of web giants.
In a letter to European Council president Donald Tusk, who will this week chair a meeting of the EU's 28 heads of state, the leaders of Britain, Ireland, Sweden, Estonia, Poland, Finland, Czech Republic and the Netherlands said the EU should only regulate "where there is clear evidence to do so."
In May the bloc's executive, the European Commission, unveiled its digital single market strategy, a broad range of policy proposals aimed at dismantling barriers to cross-border online shopping, updating copyright rules and ending blocks on watching online videos abroad.
Central to European Commission president Jean-Claude Juncker's strategy to create jobs in the EU, the plan also includes a review of the business practices of online platforms - such as Google, Amazon and Facebook - which could lead to new regulation.
France and Germany have been among those pushing strongly for platform regulation to enable smaller European upstarts to compete with American tech giants, prompting US president Barack Obama earlier this year to accuse Europe of taking a protectionist turn.
But in the letter, the eight leaders called for a prudent approach to regulation while urging strong political endorsement of the digital single market strategy.
"There is no greater opportunity at our disposal to make a real difference for investment, growth and jobs, and deliver a vital boost to Europe’s future global competitiveness," the heads of state wrote in the letter.
"This also means getting the regulatory balance right...It is very clear that a successful digital single market will not be one that stifles innovation, investment and entrepreneurship."
European Commission vice president Andrus Ansip, a former prime minister of Estonia, has strenuously denied an anti-American bias in his strategy, particularly in the area of online platforms.
A senior Google executive today said regulating the internet would hurt web companies and telecom operators alike.
"If Europe goes down the route of regulating the internet more, that would make [investors] less likely to invest more in European ISPs," Google public policy manger Theo Bertram said.
The warnings come as Australia passes new website blocking laws for overseas piracy-hosting sites such as The Pirate Bay.
On Monday night the Australian Senate approved legislation which will allow rights holders to apply to a court to block overseas websites facilitating copyright infringment.
The legislation had received strong criticism from the Australian Greens and a number of independent and minor party MPs, the telecommunications industry, technology companies and consumer groups, but the country's Coalition government and Labor opposition nevertheless united to vote it through.
The legislation has been labelled Australia's "second internet filter" behind powers that allow law enforcement agencies to block websites in order to disrupt illegal online activites.
The bill now awaits royal assent - a formality - before it officially becomes law.