According to Bloomberg News, the biggest technology companies in the world might face billions of dollars as fines for breaching new European Union legislation. The details of the same will be agreed upon as soon as Friday by the lawmakers.
The Digital Services Act is the EU’s solution to what it ascertains as a failure by the technology giants to counter the presence of illegal content on their respective platforms. For non-compliance, companies could have to shell out around 6% of their annual sales globally once the rules come into effect towards the beginning of 2024.
Not complying could be a costly affair. Based on the annual sales of 2021, Amazon, for example, could be subjected to a theoretical fine of about 26 billion euros which is equivalent to $28 billion. For future noncompliance with DSA, or for instance, in the case of Google, it could cost as much as 14 billion euros.
Frances Haugen, the Facebook whistle-blower, stated that DSA could represent a global gold standard for regulating social media companies. After almost a year of wrangling internally, the key norms that are anticipated to be declared include the following.
- A ban that will be imposed on sensitive data like religion and race for targeting ads
- A prohibition on targeting any ad to the minors
- A ban on dark patterns compels people to give consent to online tracking.
The extended impact of the EU content rules
All websites are answerable to the DSA. However, those platforms that have extensive users with numbers exceeding 45 million must follow stricter norms like paying a supervisory fee to Brussels of as much as 0.1% of their annual revenue globally so that laws can be enforced and provide regulators with yearly reports related to content that is illegal and harmful on their websites.
Bloomberg News reports that an agreement on the DSA text will be the second most important piece of legislation in the digital rulebook of Brussels that requires to be cemented in one month. On the 24th day of March, the EU made final the Digital markets Act, which is a related framework requiring gatekeepers to comply with strict antitrust norms.
Both the maws were formulated to address issues related to market dominance and safety on the internet. However, while earlier announced DMA targets approximately a dozen of well-known tech companies that are mostly US-based, the DSA has set fundamental standards for all the websites.
Amazon and Google have been targeted for a long related to antitrust investigations from Brussels; however, these cases carry on for years in the courts and have had a negligible impact on behavior. Officials have said that they will require tools like DMA and DSA to break what the European Union states are a strange hold on the digital ecosystems and the platforms by a couple of stalwarts.
