EU To Impose Major Fines In Tech Regulation Overhaul

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Digital Services Act to be unveiled by European Commission this week imposes fines of up to 6 percent of companies’ turnover for breach of new rules

Tech giants could be fined up to 6 percent of their annual turnover for breaching new EU rules set to be introduced this week, as the bloc prepares to overhaul its digital regulations.

Publication of the landmark Digital Services Act (DSA) is now set for Tuesday, 15 December, following delays.

The rules impose particular restrictions on “very large” companies such as Google, Facebook or Amazon.

Such firms are defined as those with more than 45 million users, or the equivalent of 10 percent of the EU’s population, according to a confidential draft of the regulation reported by several news outlets.

eu, digital services act

Transparency

The draft singles out “very large platforms” because of their “disproportionate influence” in users within the EU.

It adds that they have a “systemic role in amplifying and shaping information flows online and for the largest part of EU citizens”.

The proposal would require large companies to vet third parties that supply goods or services via their platforms and to share data with authorities on how they deal with illegal content.

The major platforms would also have to ensure advertising transparency by letting users know “unambiguously” that they are viewing an ad.

They would also have to let consumers know who is providing the ad and to give “meaningful information” on why they were targeted for it.

The largest companies would have to appoint one or more compliance officers to handle the provisions internally, with independent auditors monitoring compliance externally and EU countries enforcing the rules.

Misinformation

Companies would also have to do more to mitigate intentional manipulation of their platforms, such as the use of bot-driven misinformation to influence elections or public health.

“Such very large online platforms should therefore bear the highest standard of due diligence obligations, proportionate to their societal impact and means,” the draft states.

Thierry Breton, the French commissioner in charge of the internal market, said in June that new rules were needed to take account of the “central role” played by big tech companies in citizens’ lives.

“With such a role comes greater responsibility, but this can happen only against the backdrop of a modern rule book for digital services,” he said.

The regulations are set to take a year or more to enter into law, and are expected to face intense lobbying from tech companies at the EU member state and European Parliament level.

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