In a landslide vote, the European Parliament has adopted the Digital Services Act and the Digital Markets Act, which are legislations that aim to make the internet safer and provide a level playing field for smaller entities and businesses online.
These laws have the scope to regulate the actions of big tech companies including Google, Apple, Facebook parent Meta, and Microsoft, but concerns regarding its implementation remain.
The European Commission has planned for a taskforce of 80 officials for enforcing these rules, however critics have mentioned this to be inadequate.
Andreas Schwab, EU lawmaker, has said that a larger task force will be needed to combat the deep pockets of big tech and their array of lawyers, according to Reuters.
Thierry Breton, Commissioner for Internal Market of the European Union, in an attempt to allay concerns, wrote, "We have started to gear the internal organisation to this new role, including by shifting existing resources, and we also expect to ramp up recruitment next year and in 2024 to staff the dedicated DG CONNECT team with over 100 full time staff."
The European Commission has reportedly put out a 12 million euro tender to aid experts in investigations and for compliance enforcement.
A European Centre for Algorithmic Transparency is also to be set up, which will require data science and algorithm scientists to assist with enforcement of the DMA and DSA.
Violation of the DSA and DMA can lead to companies incurring hefty fines. Under the DSA, violation can lead to a fine of 6 percent of the company’s global turnover, while under the DMA, sanctions could be to around 10 percent of the company’s global turnover, and up to 20 percent for repeated offenders.
The law, crucially, differentiates between digital ‘gatekeepers’ which are very large companies in the space, and smaller companies, meaning that different rules apply to them.
What Are the Two Acts?
The Digital Markets Act aims to control gatekeepers to make the digital space more fair for deserving and up-and-coming players.
A gatekeeper is a company in the EU with a significant impact on the internal market, links a large user base to a large number of businesses, and has been able to maintain this status for three financial years.
The act will set up dos and don’ts for gatekeepers to prevent them from using unfair practices that will affect businesses depending on them from doing well, and customers as well.
The Digital Services Act comes with a lot of safety measures to prevent the circulation of illegal content on the internet, and attempts to make platforms more transparent.
The legislation calls for mechanisms online that allow people to report illegal activity, bans targeted advertising that might use certain types of personal data, or target children.
It also calls for very large platforms and search engines to prevent misuse of their services and do more to ensure that by taking risk-based action. It also allows for researchers to access data from big platforms that can help them trace how risks evolve online.
The proposals for these acts were made in December 2020, and a political agreement regarding DMA was reached in March 2022, and for the DSA, in April 2022. The DSA and DMA will not be immediately applicable, this will happen only after the stipulated time period mentioned in the acts respectively.
There is a chance that these rulings by the EU could lead to a wave effect, with other countries adopting similar legislations. This is currently being seen with the EU legislation standardising charging ports, and in the past with the General Data Protection Regulation EU, passed by the EU in 2016.
(With inputs from Silicon Republic and Reuters)
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