EU officials were negotiating Friday over the final details
of the Digital Services Act, which would overhaul the 27-nation bloc’s digital
rulebook and cement its position as the global leader in reining in the power
of social media companies and other digital platforms, such as Facebook, Google
and Amazon.
The new rules, which are designed to protect internet users
and their “fundamental rights online,” would make tech companies more
accountable for content created by users and amplified by their platforms’
algorithms.
“The DSA is nothing short of a paradigm shift in tech
regulation. It’s the first major attempt to set rules and standards for
algorithmic systems in digital media markets,” said Ben Scott, a former tech
policy advisor to Hillary Clinton who’s now executive director of advocacy
group Reset.
Once agreed to in principle, the law would still need to be
approved by the European Parliament and European Council, though that is not
expected to be a major hurdle. It has not been decided when the law would go
into effect.
Negotiators were hoping to hammer out a deal before the end
of Friday, ahead of French elections Sunday. A new French government could
stake out different positions on digital content.
Under the new law, social media platforms like Facebook and
Twitter would have to give users tools to flag things like hate speech in an
“easy and effective way” so that it can be swiftly removed. Online marketplaces
like Amazon would have to do the same for dodgy products, such as counterfeit sneakers
or unsafe toys.
These systems will be standardized so that they will work
the same way on any online platform.
That means “any national authority will be able to request
that illegal content is removed, regardless of where the platform is established
in Europe,” the EU’s single market commissioner, Thierry Breton, said on
Twitter.
Companies that violate the rules face fines amounting to as
much as 6% of their annual global revenue, which for tech giants would mean
billions of dollars. Repeat offenders could be banned from the EU market.
Europe is far ahead of the United States in drawing up
regulations for tech giants to force them to protect people from harmful
content that proliferates online.
The tech giants have been lobbying furiously in Brussels to
water down the EU rules. Google and Twitter declined to comment. Facebook
didn’t respond to requests for comment. Amazon referred to a blog post from
last year that said it welcomed measures that enhance trust in online services
and improve the experience of customers and businesses in Europe.
The Digital Services Act also includes measures to better
protect children by banning advertising targeted at minors. Online ads targeted
to users based on their gender, ethnicity and sexual orientation would also be
prohibited.
There also would be a ban on so-called dark patterns —
deceptive techniques to nudge users into doing things they didn’t intend to,
such as sign-up for services that are easy to opt into, but hard to decline.
Tech companies would have to carry out annual risk
assessments on illegal content, disinformation and other harmful information
and then report back on their progress.
Up until now, regulators have had no access to the inner
workings at Google, Facebook and other popular services. But under the new law,
the companies will have to be more transparent and provide information to
regulators and independent researchers on content-moderation efforts. This
could mean, for example, making YouTube turn over data on whether its
recommendation algorithm has been directing users to more Russian propaganda
than normal.
To enforce the new rules, the European Commission is
expected to hire more than 200 new staffers. To pay for it, tech companies will
be charged a “supervisory fee,” which could be up to 0.1% of their annual
global net income, depending on the negotiations.
This law would cement Europe’s role as the global pacesetter
for tech regulations. Scott said the new rules will likely spark copycat
regulatory efforts by governments in other countries, while tech companies will
also face pressure to roll out the rules beyond the EU’s borders.
“If Joe Biden stands at the podium and says ‘By golly, why
don’t American consumers deserve the same protections that Google and Facebook
are giving to Europe consumers,’ it’s going to be difficult for those companies
to deny the application of the same rules” elsewhere, he said.
The EU reached a separate agreement last month on its
so-called Digital Markets Act, a law aimed at reining in the market power of
tech giants and making them treat smaller rivals fairly.
The EU’s earlier groundbreaking law — the General Data
Protection Regulation — set the global standard for data privacy protection,
though it has faced criticism for not being effective at changing the behavior
of tech companies. Much of the problem with GDPR centers on the fact that a
company’s lead privacy regulator is in the country where its European head
office is located, which for most tech companies is Ireland.
Irish regulators have opened dozens of investigations into
Facebook, Google and other Silicon Valley companies since GDPR took effect in
2018, but have only issued judgements for a handful. Critics say the the
problem is understaffing but the Irish regulator says the cases are complex and
time consuming.
EU officials have learned from that experience and will make
the bloc’s executive Commission the enforcer for the DSA and DMA. -AP
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