The bloc agreed on the general terms of the Digital Services Act, or DSA, early Saturday morning, after hours of negotiations. The DSA will oblige tech companies to take more responsibility for the content that appears on their platforms.
The additional requirements include eliminating unlawful content and commodities more swiftly, clarifying how its algorithms work for consumers and researchers, and taking tougher anti-misinformation measures. Noncompliance can result in fines of up to 6% of a company’s annual sales.
In a statement, European Commission President Ursula von der Leyen said, “The DSA will update the core regulations for all online services in the EU.” “It puts the concept that what is unlawful physically should also be illegal online into practice.” The higher the magnitude of an internet platform, the greater its responsibility.”
“What is criminal in the real world should be illegal in the virtual world.”
The rule would “ensure platforms are held accountable for the risks their services may pose to society and citizens,” said Margrethe Vestager, the European Competition Commissioner who has championed much of the bloc’s tech regulation.
The DSA is not to be confused with the Digital Markets Act, or DMA, which was passed in March. Both acts have an impact on the realm of technology, but the DMA focuses on leveling the playing field between businesses, whilst the DSA addresses how businesses govern material on their platforms. As a result, the DSA is more likely to affect Internet users right away.
Despite the fact that the Act solely applies to EU citizens, its impact will be felt around the world. Global tech corporations may conclude that implementing a unified content policing policy and using the EU’s comparably harsher standards as a benchmark is more profitable. While lawmakers in the United States who want to rein in Big Tech with their own restrictions have already begun to look to EU guidelines for guidance.
The DSA’s final text has not yet been released, but the European Parliament and other European Commissions have. They’ve outlined a set of responsibilities that will include:
- It is illegal to target advertisements based on a person’s religion, sexual orientation, or ethnic origin. Targeted advertising is also not permitted for minors.
- Dark patterns, or user interfaces that confuse or mislead people into making specific decisions, will be prohibited. According to the EU, canceling subscriptions should be as simple as signing up for them.
- Large online platforms, such as Facebook, will need to make the inner workings of their recommendation algorithms public to consumers (for example, to rank content in News Feed or to propose TV episodes on Netflix). Users should also have access to a “non-profile-based” recommendation mechanism. For example, on Instagram, this would imply a chronological feed (such as recently introduced).
- Hosting firms and internet platforms would have to explain why they have removed illegal content and give consumers the option to appeal such removals. The DSA, on the other hand, does not define what content is unlawful and instead leaves it up to each country to decide.
- To “give more insight into how online hazards are evolving,” the top internet platforms will be required to provide critical data to researchers.
- To track down anyone selling unlawful products or services, online marketplaces must keep basic information about merchants on their platforms.
- During crises, the major platforms will also have to implement new measures to combat disinformation (a provision inspired by the recent invasion of Ukraine).
The DSA, like the DMA, will differentiate between different sizes of technology companies, with additional requirements placed on larger companies. The largest businesses, those with at least 45 million EU users, such as Meta and Google, would be scrutinized the most. These technology firms have worked hard to weaken DSA regulations, notably those pertaining to targeted advertising and data processing for independent researchers.
Although EU member states have now agreed on the fundamental terms of the DSA, the formal text has yet to be finalized and the act officially adopted into law. This final stage, however, is regarded as a formality at this time. The requirements will apply to all firms 15 months after the bill is passed, or on January 1, 2024, whichever comes first.