By Supantha Mukherjee

STOCKHOLM (Reuters) -The European Union's content moderation law is incompatible with America's free speech tradition and there is a risk that it will excessively restrict freedom of expression, the Federal Communications Commission (FCC) chairman said on Monday.

"There is some concern that I have with respect to the approach that Europe is taking with the DSA (Digital Services Act) in particular," Brendan Carr, a Republican appointed to the FCC by U.S. President Donald Trump, said at the Mobile World Congress in Barcelona, Spain.

For U.S. tech companies in Europe, Carr said, DSA's censorship "is something that is incompatible with both our free speech tradition in America and the commitments that these technology companies have made to a diversity of opinions."

The DSA, which became effective a year ago, is meant to make the online environment safer and fairer by compelling tech giants to do more to tackle illegal content including hate speech and child sexual abuse material.

Violations of the DSA could potentially mean big fines. Social media companies X and Meta are currently being investigated under the DSA.

"The DSA is not about censorship and contains important protections against censorship," a European Commission spokesperson said. "The censorship allegations relative to the DSA are completely unfounded."

Geofencing, or the practice of restricting content according to a user's location, had been considered as a potential solution, dividing platforms into one consistent with EU law and a separate one for free speech.

Carr said it was unclear whether this approach was technically or economically feasible.

The European Commission had earlier taken a stance against blocking content based on geography, asking Apple in December to stop restricting content according to a user's location.

Last month, Trump signed a memorandum warning that his administration would scrutinise the EU's Digital Markets Act and the DSA "that dictate how American companies interact with consumers in the European Union".

In a letter to U.S. technology companies last week, Carr requested briefings on how they planned to reconcile the DSA with America's free speech tradition.

"If there is an urge in Europe to engage in protectionist regulations, to give disparate treatment to U.S. technology companies, the Trump administration has been clear that we are going to speak up and defend the interests of U.S. businesses," he said.