EU agrees on landmark law aimed at forcing Big Tech firms to tackle illegal content

The European Union agreed on new digital regulations Saturday that will force tech giants like Google and Meta to police illegal content on their platforms more aggressively, or else risk potential multibillion-dollar fines.

The European Parliament and EU member states reached a deal on the Digital Services Act, a landmark piece of legislation that aims to address illegal and harmful content by getting platforms to rapidly take it down.

A key part of the legislation would limit how digital giants target users with online ads. The DSA would effectively stop platforms from targeting users with algorithms using data based on their gender, race or religion. Targeting children with ads will also be prohibited.

So-called dark patterns — deceptive tactics designed to push people toward certain products and service — will be banned as well.

Tech companies will be required to implement new procedures designed to take down illegal material such as hate speech, incitement to terrorism and child sexual abuse. E-commerce marketplaces like Amazon must also prevent sales of illegal goods under the new rules.

Failure to comply with the rules may result in fines of up to 6% of companies’ global annual revenues. For a company like Meta, the parent company of Facebook, that could mean a penalty as high as $7 billion based on 2021 sales figures.

The DSA is separate from the Digital Markets Act, which EU institutions approved last month. Both come with the threat of hefty fines. But whereas the DMA seeks to curb Big Tech firms’ market power, the DSA is all about making sure platforms get rid of toxic content quickly.

The law will affect user-generated content sites like Facebook, Instagram, Twitter, YouTube and TikTok.

Brussels has a long history of taking internet giants to task over competition abuses and data privacy.

The bloc has leveled a combined 8.2 billion euros ($8.8 billion) in fines against Google over antitrust violations, and has active investigations into Amazon, Apple and Meta.

In 2018, the EU introduced the General Data Protection Regulation, a sweeping set of privacy rules aimed at giving consumers more control over their information.

It comes as policymakers in Washington wrangle with the question of how to rein in the power of large tech companies and get them to clean up their platforms of harmful content. On Thursday, former President Barack Obama said the tech industry needs regulation to address the spread of online disinformation.

“For too long, tech platforms have amplified disinformation and extremism with no accountability,” former U.S. Democratic Presidential candidate Hillary Clinton tweeted Thursday.

“I urge our transatlantic allies to push the Digital Services Act across the finish line and bolster global democracy before it’s too late.”

But how the EU manages to implement its new rules in practice is unclear. Critics say implementing such measures will create technical burdens and raise questions around what speech is or isn’t acceptable online.

In the U.K., new laws designed to tackle unsafe content has been heavily criticized by some in tech industry — not least the Big Tech platforms — due to a vague description of material that is “legal but harmful.”

Detractors argue this could heavily limit freedom of expression online. For its part, the British government said it won’t require any legal free speech to be removed, and that “democratically important” content will be protected.