On Tuesday, the European Union (EU) published stringent draft rules punishing tech companies such as Google, Amazon and Facebook, whose influence is seen by Brussels as a challenge to innovation and even democracy.
The landmark reforms, which come as Silicon Valley confronts increasing global pressure, might shake up the way Big Tech does business by threatening mammoth penalties or bans from the European market for some of the world’s largest businesses.
Bringing order to chaos
EU antitrust chief Margrethe Vestager said the bloc’s proposed regulations to control the internet sought to add “order to chaos” and to reel in the market-dominating web “gatekeepers”
She told a press conference, “The Digital Service Act and Digital Markets Act will create safe and trustworthy services while protecting freedom of expression,”
The EU claims that long-trailed laws will place penalties on internet behemoths of up to 10% of their revenue for violating any of the more serious antitrust regulations or otherwise risking a breakdown.
It also proposes that they be fined six percent of their income or temporarily barred from the EU market “in the event of serious and repeated breaches of law which endanger the security of European citizens”
The Digital Services Legislation and its accompanying Digital Markets Act would set down stringent commercial requirements in the EU’s 27 member countries as regulators seek to curtail the dissemination of internet news and hate speech, as well as the business domination of Big Tech.New gatekeepers vs. Tech Giants
EU appoints ‘gatekeepers’ vs tech giant
According to a source near to the EU Commission, ten companies were appointed as ‘gatekeepers’ under competition law and were subject to unique legislation in order to curb their ability to control markets.
US titans Facebook, Google, Amazon, Apple, Microsoft and SnapChat, China’s Alibaba and Bytedance, South Korea’s Samsung and the Netherlands’ Booking.com are the businesses that will be subject to tighter regulations.
The proposals would go through a lengthy and complicated period of adoption, with the final legislation being affected by the 27 EU states, the European Parliament and the lobbying frenzy of businesses and trade associations.
As a means to offer the Commission finer teeth in prosecuting social networking sites when they allow illicit web material, such as terrorist messaging, hate speech, misinformation and child abuse, the Digital Communications Act is being touted.
The EU aims to grant Brussels new authority, under the Digital Markets Act, to apply antitrust regulations more quickly and to press for greater accountability in their algorithms and the usage of personal data.
The guidelines are meant to amend regulations going back to 2004, when several of the internet companies of today either simply doesn’t exist or were in their gestation.
The new legislation “are on the correct course to help maintain what is great about the internet” a Facebook spokesman said, insisting that it looked forward to to engaging with EU policymakers.”
The social network attacked fellow tech giant Apple, arguing that it required the guidelines for the iPhone manufacturer to “set boundaries” in which it has clashed over privacy.
The campaign group Avaaz said the law could prove to be a “bold and brave move” but Brussels demanded that it be strictly implemented.
Member of the European Parliament David Cormand, who sits on its Committee on the Internal Sector, said the regulation was a “step in the right direction” but lacking the ambition to “regain power over our digital services”
Regulators tackling big tech
The EU and US regulators has taken the lead globally over the past decade in attempting to grapple with the influence of big tech, placing billions of monopoly penalties on Google, for instance. But detractors think the strategy has become too slow and achieved nothing to alter actions.
The EU has required Apple to compensate Ireland billions of euros in back taxes, but the bloc’s top court quashed the ruling.
The movements in Brussels on Tuesday come when regulators across the world have grown deeply worried about the financial and social influence of big technology.
In addition to a legal attempt to rob Facebook of its Instagram and Whatsapp goods, US regulators have taken up the call, with many big antitrust lawsuits involving Google.
The British government was also due on Tuesday to announce new laws to counter “online harms” by adding the possibility of penalties for internet giants.