EU and Britain Make New Rules to Curtail the Power of American Tech Giants in Europe

EU and Britain Make New Rules to Curtail the Power of American Tech Giants in Europe

The European Union is making a new set of rules that will guide the use of data in Europe. The EU commissioners said the move stems from the need to make Europe “No. 1 data continent”, and to check the excesses of American tech giants, Google and Facebook.

The use of personal data and online privacy have been a bone of contention between EU regulators and American tech companies; and now, the bloc wants stricter rules to curb abusive use of private data and anti-competitive practices.

EU Internal Market Commissioner Thierry Breton and the bloc’s executive Vice President Margrethe Vestager, have outlined plans on how Europe’s individuals, businesses and governing bodies could better handle data, according to DW.

But the aim of this move is more about making Europe the “No.1 data continent” that will square it up with China and the United States, than it is about curtailing American tech giants’ monopolistic practices.

The new regulatory rules will operate outside the 2016 EU data privacy laws, though it doesn’t replace the old rules which would be consulted for data sharing when there is need. In a sense, it will serve as alternative model.

Breton and Vestager shed light on how the new model will function. The bloc will create “European data spaces” where businesses, governments and researchers could store and access “protected” information.

That concept anchored in an EU Digital Governance Act would be followed by a Digital Services Act (DSA) and a Digital Market Act (DMA).

Vestager wants the DSA to use designated platforms to report hate speech and counterfeit produce to European regulators and remove it. He said the framework will offer an alternative model to those operated by big tech platforms, adding that the giants would be required to disclose their algorithms used to recommend online content.

EU and UK flags

Breton said the Europe’s novel Digital Market Act would via quantitative and qualitative rules seek to curb unfair behavior by internet giants, and many small and middle sized companies will benefit.

While the new rules will significantly change existing protocols, Breton said the EU would comply with the rules of the World Trade Organization (WTO), though there is going to be strict measures of enforcement.

“To ensure that data can circulate, we need to have rules, which will build trust and confidence,” he said. Adding that there will be sanctions, but forcing offenders into “structural separation” will be a last resort.

As part of the new rules, big tech companies seeking acquisition might also be required to inform the European Commission of their intentions, said Breton.

The EU Commission estimates that the new internet rules, if implemented, could increase the annual economic value of Europe’s data sharing from €7 billion ($8.3 billion) to about €11 billion by 2028. But the Commission admits that it could take up to two years to implement as it requires negotiations with individual EU states and the European Parliament.

Outside the EU, Britain is walking the same terrain to create new rules that will ensure competitiveness in the tech industry. The new regime, which will ensure that the monopolistic practices of Facebook and Google are curtailed, will kick off next year from a unit within the existing Competition and Markets Authority (CMA).

Britain’s Digital Secretary Oliver Dowden said there was a growing consensus that the concentration of power in a small number of companies was curtailing growth, reducing innovation and having negative impacts on the people and businesses that rely on them. He added that “it’s time to address that and unleash a new age of tech growth”.

Reuters reported that the newly created Digital Markets Unit, which is expected to start work in April, could be given powers to suspend, block and reverse decisions made by technology firms and to impose financial penalties for non-compliance.

The government said under the new unit, companies will have to be more transparent about how they use consumer data and restrictions that make it hard to use rival platforms will be banned. It added that the rules will also support the news industry, rebalancing the relationship between publishers and platforms.

Google, Facebook, Apple and Amazon have been on and off with governments in Europe, over antitrust concerns. Google and Facebook have been particularly caught in the web of government’s attention, as the push to get ahead in digital advertising is spurring the companies to breach private data rules.

The CMA said Google and Facebook dominate digital advertising, accounting for around 80% of 14 billion pounds spent in Britain in 2019.

But the companies said they are ready to work with the British government and digital regulators on advertising, to give users more control of their data and the ads they are served.

Share this post

Post Comment