European lawmakers have finally reached an agreement over an exhaustive collection of new regulations for big tech platforms. The laws mean big changes in oversight for tech companies, from social media algorithms to digital advertising—with potential ramifications globally.
The Digital Markets Act (DMA) and Digital Services Act (DSA) were proposed by the European Commission in December 2020. Now, composed in a “Digital Services Package,” the legislation has been formally adopted by the European Parliament and seeks to address “gatekeeper” big tech companies.
The act will have significant consequences for Google, Meta, and Apple: the online “gate-keepers” that must now do business according to a list of dos and don’ts created to ensure the survival of smaller competitors.
This law is the second landmark tech legislation in Europe within a month. It aims to impose new rules on how the tech industry handles misinformation and illegal content on social media, as well as illegal goods and services on online marketplaces. The biggest companies that violate the law could face billions in fines.
“Today’s agreement—complementing the political agreement on the Digital Markets Act last month—sends a strong signal: to all Europeans, to all EU businesses, and to our international counterparts,” said European Commission President Ursula von der Leyen.
With this law, officials have more tools for removing hate speech, going after e-commerce sellers who promote illegal goods, and scrutinizing the recommendation algorithms of tech platforms, among other things. It applies not only to social media sites but also to app stores, gig economy platforms, and even cloud services and internet providers.
For large online platforms that have over 45 million European users, the law would require content moderation risk assessments and independent audits tied to their handling of illegal material, as well as content that may be legal but still threatens public health, human rights, or other public interest priorities.
Former Facebook whistleblower Frances Haugen told EU policymakers last year that the DSA could serve as a “global gold standard” for other lawmakers to follow.
The tech industry, meanwhile, has actively lobbied on the measure, in some cases warning about the risks that prescriptive requirements could pose to innovation.