European Executive Vice-President Margrethe Vestager.
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The European Union on Saturday agreed on new digital rules that will force technology giants like Google and Meta to police illegal content on their platforms more aggressively, otherwise risking potential fines of billions of dollars.
The European Parliament and EU Member States reached an agreement on the Digital Services Act, a landmark piece of legislation aimed at addressing illegal and harmful content by getting platforms to remove it quickly.
Margrethe Vestager, EU competition director and a key architect behind the bloc’s digital reforms, said the agreement is “better than the proposal we made” back in 2020.
“It is no longer a slogan that what is illegal offline must also be seen and handled online,” Vestager said in a video posted on Twitter. “Now that’s a real thing. Democracy is back.”
European Commission President Ursula von der Leyen issued a statement calling the agreement “historic”.
“The DSA will upgrade the ground rules for all online services in the EU,” she said. “It will ensure that the online environment remains a safe space that ensures freedom of expression and opportunities for digital businesses.”
What is DSA?
A key part of the legislation will limit how digital giants target users with online ads. DSA would effectively prevent platforms from targeting users with algorithms using data based on their gender, race or religion. It is also forbidden to target children with ads.
So-called dark patterns – deceptive tactics designed to push people towards certain products and services – will also be banned.
Technology companies will be required to implement new procedures designed to remove illegal material such as hate speech, incitement to terrorism and child sexual abuse. E-commerce marketplaces like Amazon must also prevent the sale of illegal goods under the new rules.
The law includes measures that force technology giants to be more transparent about the algorithms they use to recommend content to users. Another provision would require very large online platforms and search engines to take certain measures in the event of a crisis, such as Russia’s invasion of Ukraine.
Failure to comply with the rules could result in fines of up to 6% of companies’ global annual turnover. For a company like Meta, Facebook’s parent company, that could mean a fine of up to $ 7 billion based on sales figures for 2021.
The law must now be formally approved by the EU institutions. It is expected to enter into force as early as 2024.
The DSA is separate from the Digital Markets Act, which was approved by the EU institutions last month. Both come with the threat of large fines. But while the DMA seeks to limit the market power of Big Tech companies, the DSA is about ensuring that platforms quickly get rid of toxic content.
The law will affect user-generated content sites such as Facebook, Instagram, Twitter, YouTube and TikTok.
A Google spokesman said the company welcomed the DSA’s goals, but added that it wanted to work with EU policy makers to “get the remaining technical details in order to ensure the law works for everyone”.
“We welcome the DSA’s goal of making the Internet even more secure, transparent and accountable, while ensuring that European users, creators and businesses continue to benefit from the open web,” the spokesman told CNBC. “As the law is finalized and implemented, the details will matter.”
A spokesman for Twitter said the company looked forward to reviewing the regulation in detail.
“We support smart, forward-looking regulation that balances the need to tackle online harm with the protection of the open Internet – while understanding that a consistent approach does not take into account the diversity of our online environment,” the spokesman told CNBC. .
“It is Twitter’s top priority to keep people safe online and to protect health in the public conversation, and within the Digital Services Act we welcome the increased focus on healthier digital spaces in the EU.”
EU vs. Big Tech
Brussels has a long history of taking internet giants to account for competition abuse and data protection.
The bloc has settled a total of 8.2 billion euros ($ 8.8 billion) in fines against Google for antitrust violations and has active investigations into Amazon, Apple and Meta.
In 2018, the EU introduced the General Data Protection Regulation, a comprehensive set of privacy rules aimed at giving consumers more control over their information.
The emergence of new European rules for regulating Big Tech comes as policy makers in Washington quarrel over the question of how to curb the power of big technology companies and get them to clean up their platforms of harmful content.
On Thursday, former President Barack Obama called for reforms of Section 230, a law that protects online platforms from liability for their users’ posts, in order to combat the spread of online disinformation.
But how the EU manages to implement its new rules in practice is unclear. Critics say implementing such measures will create technical burdens and raise questions about what speech is or is not acceptable online.
In the UK, new laws designed to tackle insecure content have been heavily criticized by some in the tech industry – not least the Big Tech platforms – because of a vague description of material that is “legal but harmful.”
Proponents argue that this can greatly restrict free speech online. For its part, the British government said it would not demand that any legal freedom of expression be removed and that “democratically important” content be protected.