New EU tech laws could sideline Irish regulators

A new package of EU legislation aiming to rein in tech monopolies and end illegal content online includes proposals that would allow the European Commission to step in to enforce rules on major multinationals directly if Irish authorities have not acted effectively.

The proposals would apply to all member states, not just Ireland, but are widely viewed as reflecting frustration in Brussels and other member states at a perceived soft touch by Irish authorities towards the major US tech multinationals that have headquarters in the country.

The Digital Markets Act and Digital Services Act are the first major overhaul of the bloc's internet regulations in 20 years and the latest challenge to the dominance of big tech, led by internal markets commissioner Thierry Breton and competition and tech chief Margrethe Vestager.

The laws take aim at what the European Commission dubs “gatekeepers”: big tech companies that dominate the market to the extent that the regulators are concerned they have such extensive access to data that they can stifle any potential competition.

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The new Digital Markets Act takes aim at anti-competitive practices in the tech industry, and will include fines of 10 per cent of global revenues if tech companies deliberately break the new laws.

Meanwhile, the Digital Services Act will force companies such as Facebook to take more responsibility for illegal content on their platforms, such as scams, terrorist content or images of abuse. Fines of up to 6 per cent of global revenue will face businesses that fail to adequately police content.

‘Enhanced supervision’

To enforce the Digital Service Act, the legislation proposes the establishment of a digital services co-ordinator in each member state. But in the case of “persistent infringements”, the commission could step in “on its own initiative” to take over enforcement.

“When it comes to very large online platforms, the new rules will provide for enhanced supervision and enforcement with the active participation of the commission,” the European Commission wrote of the proposals.

“In case of persistent infringements, the commission ... may initiate proceedings against very large online platforms. This will ensure speedy intervention in EU-wide cases where very large online platforms raise systemic risks and ensure the level of assistance required to deal with the complex technical and societal issues posed by the biggest online platforms.”

The proposals require the approval of member state governments and the European Parliament in order to be adopted, a process that can take several years and is likely to involve revisions to the plans.

The proposals are likely to receive sharp scrutiny in Dublin, where there is concern at hardened positions in Brussels and many member states towards the regulation and taxation of US multinationals with headquarters in Ireland such as Apple, Facebook and Google.