What is going on
The European Parliament has voted to adopt the Digital Services Act and Digital Markets Act.
Why it matters
These two pieces of legislation will overhaul the way Big Tech and the Internet are regulated in Europe, introduce better protections for Internet users, and potentially lead to hefty fines for tech companies that fail to abide by the rules.
What’s next
Both legislations are due to be adopted by the Council of the European Union before coming into force later this year.
The EU moved one step closer to implementing its revised plan to regulate Big Tech and the internet on Tuesday when the European Parliament voted to approve the new digital services package.
The package consists of two legal texts: the Digital Services Actthat protects the rights of Internet users, and the Digital Markets Act, which is designed to create fair and open competition in the digital world. Together, the two laws propose a set of new rules for all digital services, including social media and online marketplaces.
Members of the European Parliament voted overwhelmingly on Tuesday morning in Strasbourg, France, to pass both laws. The DSA was passed by 539 votes in favor (with 54 against and 30 abstentions), and the DMA by 589 votes in favor (with 11 against and 31 abstentions). The next step in the lengthy EU legislative process is for both laws to be adopted by the Council of the European Union and are expected to come into force in the autumn.
“Ten years ago, a page was turned about ‘too big to fail’ banks,” Internal Market Commissioner Thierry Breton said in a statement. “Now – with DSA and DMA – we are turning the page on ‘too big to care’ platforms.”
The two laws mark the EU’s biggest effort to date to hold Big Tech accountable, with dazzling penalties for those who break the rules. Major tech companies can face fines of up to 10% of their global revenue for DMA violations and 6% for DSA violations, potentially up to billions of dollars.
As countries around the world struggle with the best way to regulate the internet, Europe has shown consistent leadership in this area by enacting laws to govern Big Tech and secure the rights of internet users in the online world. Not all of these efforts are unanimously regarded as successful by tech companies and critics, but they are hugely influential when it comes to shaping the policies of tech companies and urging other countries, including the US, to legislate on their own.
There are a number of ways the new laws could influence the actions of tech companies in years to come. The Digital Markets Act is the EU’s attempt to level the playing field between technology companies of all sizes and could force companies to make messaging apps interoperable. The DSA would prohibit certain types of advertising on platforms, targeted ads that target children or are tailored to people’s ethnicity or sexual orientation.
“We are finally building one digital market, the most important in the ‘free world’,” Breton said on Tuesday. “Across the EU, the same predictable rules will apply to our 450 million citizens, giving everyone a safer and fairer digital space.”