Sergii Figurnyi - stock.adobe.co
Pressure is mounting on European Union (EU) institutions to cut back regulations they are preparing to impose on US big tech firms while forming laws to create a single digital market.
US government lobbying against a European Parliament vote that decided on 20 January, in effect, to make EU digital laws single out US tech platforms for more stringent regulations has been followed by calls from tech industry bodies and US representatives to undo that vote before it is made into law.
As EU institutions proceed with negotiations over the final terms by which that and another law (the Digital Services and Markets Acts) will govern digital platforms such as Facebook and Google, some experts have argued that the EU laws were designed with unprecedented speed and little evidence of either their necessity or efficacy, to the detriment of the economy.
But the French presidency of the European Union has wrapped the laws into a “European digital sovereignty” plan to build EU alternatives to US communications infrastructure and big tech platforms, resorting to open source systems and public money where EU companies have not gained supremacy by private means alone.
The US Senate Committee on Finance urged US president Biden in February to continue lobbying the EU to challenge what it said were protectionist laws that unfairly and, it implied, illegally, targeted big US corporations, while favouring EU firms and state-owned Russian and Chinese tech platforms. The US Trade Representative, an executive office of the president, had power to take retaliatory measures, warned committee chairman, senator Ron Wyden.
The EU was “hell-bent” on nailing dominant Silicon Valley platforms, according to an article for the Center for European Policy Analysis, a distinguished Washington think tank. It was effectively nailing “virtually any company that is successful, challenges old-fashioned business models – and, therefore, is rarely European”.
Henri Verdier, ambassador for French digital affairs, insisted in the same forum that “digital sovereignty is not anti-American” nor economic protectionism, but a means to protect democracy from the World Wide Web, where criminals and terrorists had been free to consort and propagandise.
Communications must be left free to flow on the internet infrastructure, he said. But rules were necessary where those communications were visible in the open on the World Wide Web.
Administrators at the European Commission (EC) wrote that balance into the Digital Services Act (DSA), prohibiting interference in internet communications infrastructure, and even forbidding web platforms from monitoring their own users for illegal or offensive communications, but empowering civil society bodies to monitor public forums and flag transgressive speech to authorities for deletion.
The immense regulation (the Parliament voted 457 amendments to it in January) forces platforms to be transparent about deletions as well, and allows public appeals for the sake of free speech. It forces transparency on targeted web trackers – which, according to digital rights campaigners, will protect people from industrial-scale data exploitation by advertisers. It also gives people power to control whether platforms use data profiles to determine what they see.
The EC created the law originally as an instrument of consumer protection, and to stop a growing patchwork of national platform regulations from obstructing the single market, and undermining commercial and human rights with arbitrary rules.
The DMA similarly sought to impose European social values on digital markets, according to Andreas Schwab, the parliamentarian who led it, and who has been singled out in US lobbying for stating that the EU law was intended to target US firms. He had been inspired to act against large platforms by historians, who argued that a concentration of economic power in 1920s Germany had helped the National Socialist Party (Nazis) take power, he said in a broadcast interview.
Market failures informed EU thoughts on ad transparency too. People no longer trusted web tech was not working against them, EC vice-president Věra Jourová told a French conference in support of the legislation in February.
Advertising bodies differed on whether the imposed transparency would restore people’s trust online, or whether parliamentarians, who voted to impose more exposure on advertisers, acted in the mistaken belief that targeted ads were a vehicle for disinformation and privacy breaches.
The EU believed ad-enabled free content had weakened the media sector and undermined democracy, Jourová said. Nearly half of all disinformation on the web was propaganda about Ukraine that came from Russian “troll factories”. The EU needed the law to defend against foreign interference operations.
The EC faced a problem in doing this, however. It could not force platforms to act as police in monitoring and censoring public communications without undermining the democracy it sought to promote. So it put obligations of transparency and accountability only on very large platforms with great reach and influence, and the governance of which could be monitored.
Parliament’s amendments raised the threshold to include only the very biggest platforms, effectively singling out US corporations, thus inciting US protests. Tech industry bodies are challenging many other of those 457 amendments as well.
Some EU states, meanwhile, believed France’s EU “digital sovereignty” plan would undermine NATO and the EU-US Transatlantic alliance, the Open Internet Governance Institute (an eminent Spanish think tank funded by Facebook parent Meta) said in January. French and German industry might benefit from it, but others (primarily with a liberal market bent) such as Holland, Finland and Spain, were opposed.
The EU intended digital sovereignty to bolster its digital single market by making it less dependent on US and Chinese technology, whereas the US got its superpower status from digital technology. And since China had threatened that technological economic power with trade dodges, espionage, surveillance and attempts to usurp international tech standards, the US sought to protect itself from EU attempts to sanction its own tech industry.
Yet the US sought a large, regulated Transatlantic digital market that would “set the rules of the game” and counter Chinese pressure, said the Open Internet Governance Institute. And the US shared with the EU a belief that technology was a means to facilitate democracy, undermine oppressive regimes, and catch the disinformation that was being spread, largely, by Russia and Iran.
While US legislators prepare to revise their own platform legislation, and Washington commentators concede that the EU has made its values and legislation the standard others follow, the US and EU have opened wide-ranging trade talks to clarify their common ground.
Read more about EU and US data concerns
- EU Committee on Civil Liberties, Justice and Home Affairs study calls for major reforms of US spying laws to enable an EU-US data-sharing agreement to replace Privacy Shield.
- Latest twist in long-running legal battle sees Facebook lose legal bid to prevent the Irish Data Protection Commissioner suspending its transfer of data about European citizens to the US.
- Helen Dixon, Ireland’s data protection commissioner, says EU regulators must agree on metrics to measure the effectiveness of data protection regulation.