New rules to limit dominance of big tech come into force

Author Moonshot.news

Published on: 16/11/2022

New European rules on how to limit the power and dominance of the world’s big tech companies are now active. The EU Digital Services Act entered into force on November 16 and the Digital Markets Act is in force since earlier this month. The new rules are meant to increase online competition and put pressure on big tech to be more active in fighting disinformation and harmful content.

“Designed as a single, uniform set of rules for the EU, these rules will give users new protections and businesses legal certainty across the whole single market. The DSA is a first-of-a-kind regulatory toolbox globally and sets an international benchmark for a regulatory approach to online intermediaries”, the EU Commission said in a statement.

DIGITAL SERVICES ACT, a short summary

• Aims to create a safer online space for users, stricter rules for platforms
• The DSA establishes a “notice and action” mechanism, as well as safeguards, for the removal of illegal content.
• Online platforms must be transparent about how algorithms work and platforms should be accountable for decisions they make.
• Measures to counter illegal products, services and content online, including clearly defined procedures for removals
• Mandatory risk assessments and more transparency over “recommender systems” to fight harmful content and disinformation
• Online platforms should be prohibited from using deceiving or nudging techniques to influence users’ behaviour through “dark patterns”
• Targeted advertising: the text provides for more transparent and informed choice for all recipients of services, including information on how their data will be monetised and to better protect minors from direct marketing, profiling and behaviourally targeted advertising for commercial purposes

DIGITAL MARKETS ACT, a short summary

• The Digital Markets Act(DMA) proposal blacklists certain practices used by large platforms acting as “gatekeepers” and enables the EU Commission to carry out market investigations and sanction non-compliant behaviours.
• The purpose of the Digital Markets Act is to ensure a level playing field for all digital companies, regardless of their size. The regulation aims to lay down clear rules for big platforms – a list of “dos” and “don’ts” – to stop them from imposing unfair conditions on businesses and consumers.
• Putting an end to unfair business practices by big online platforms
• Restrictions on “killer acquisitions”
• Gives users the option to uninstall pre-installed software applications, such as apps, on a core platform service at any stage
• Whistleblowers should be able to alert competent authorities to actual or potential infringements. They should be protect them from retaliation
• The Commission can impose fines of “not less than 4% and not exceeding 20%” of its total worldwide turnover in the preceding financial year.

NEXT STEPS

Next steps include national implementation in EU member states.The Commission is also setting up a European Centre for Algorithmic Transparency (ECAT) to support its supervisory role with in-house and external multidisciplinary knowledge. The Centre will provide support with assessments as to whether the functioning of algorithmic systems are in line with the risk management obligations that the DSA establishes to ensure a safe, predictable and trusted online environment.

Following the entry into force of the DSA, online platforms will have 3 months to report the number of active end users (17 February 2023) on their websites. The big platforms will after that have 4 months to comply with the obligations under the DSA. 

The EU’s Digital Markets Act is in force from November and in six months, by May 2, it should be implemented in all EU countries.