New European Commission efforts to tighten regulations on big tech companies are getting some interesting review from an agency tasked with evaluating these types of laws within the European community as a whole.
This entity, called the Regulatory Scrutiny Board, is suggesting that legislators may not have drafted these new rules with enough specificity in terms of what companies are subject to the laws.
The new EC Digital Services Act identifies “online gatekeepers” that may need to pay fines of up to 10% of revenues, according to the regulatory formula in place, where evaluators use “break-up” to examine the subsidiary parts of a corporate whole.
However, the RSB posits insufficient precision in identifying these parties, and also talks about efforts to make sure that new regulation doesn’t restrict “economies of scale for consumers.”
That last bit might seem spurious to consumer advocates who want better consumer protections instead of ever-greater “economies of scale.” On the other side of the Atlantic, meanwhile, the United States has been implementing privacy related laws on the same tech companies, as in this New York Times coverage of FTC decisions in 2019.
“Until now, the biggest fines and restrictions against tech companies have come from Europe,” wrote NYT reporter Cecilia Kang July 12 of last year. “Officials there have imposed several charges of antitrust and privacy laws against Amazon, Apple, Facebook and Google. Last year, the European Union fined Google $5.1 billion for abusing its large market share in the mobile phone industry. More recently, numerous officials and lawmakers around the world have rushed to regulate Facebook.”
Here’s how some European leaders have described the two major goals of the new legislation:
“1. to create a safer digital space in which the fundamental rights of all users of digital services are protected
2. to establish a level playing field to foster innovation, growth, and competitiveness, both in the European Single Market and globally”
Now, though, the EC will have to satisfy the independent RSB in order to move the ball forward in a way that could have big effects on tech markets. Keep an ear to the ground.
