Digital Regulation Act Passes European Parliament Threshold... "Potential Conflicts with Big Tech over Application"

[Image source=AP Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] The European Parliament has passed digital regulatory bills that prohibit monopolistic practices by so-called 'Big Tech' companies such as Alphabet, Google's parent company, Meta, which operates Facebook and Instagram, and Apple, and prevent the distribution of illegal content.

According to the Wall Street Journal (WSJ) and others on the 5th (local time), the European Parliament approved the 'Digital Markets Act (DMA)' and the 'Digital Services Act (DSA)' on the same day. These two laws were prepared by the European Union (EU) to regulate Big Tech companies, and a provisional agreement among member states was reached earlier this year.

The DMA is a law that prevents market monopolies by Big Tech companies. It prohibits companies that provide services such as social networking services (SNS), search engines, and operating systems, acting as so-called 'online gatekeepers,' from prioritizing their own services over those of other companies. The DMA also includes provisions to allow users to delete pre-installed software or applications (apps) and to enable interoperability of messaging services.

The DSA is a law that imposes an obligation on IT companies to remove harmful content. It aims to prevent the online distribution of content related to illegal activities such as biased remarks based on specific race, gender, or religion, terrorism, and child sexual abuse.

Having passed the European Parliament, these bills are now awaiting approval from the 27 EU member states. Once approved by the member states, IT companies operating in these countries that violate the DMA can be fined up to 10% of their annual global revenue, and those violating the DSA can be fined up to 6%.

Thierry Breton, EU Commissioner, said, "The EU is the first jurisdiction in the world to establish comprehensive standards for regulating the digital space." Andreas Schwab, a German member of the European Parliament who led the passage of the bills, evaluated, "With this legislation, the European Parliament has entered a new era of technology regulation."

Ursula von der Leyen, President of the European Commission, welcomed the European Parliament's legislation on Twitter, stating, "The European Commission will become the digital regulatory authority for the largest platforms." She added, "We welcome the DSA, which controls illegal and harmful online content, and the DMA, which defines what gatekeepers must and must not do."

The DMA is expected to come into effect within a few months. However, the WSJ anticipates that it will not be easy for Big Tech companies to comply with it by 2024. The DSA is scheduled to be applied from January 2024, but the EU plans to expedite its introduction to mid-next year. The European Commission has formed a team focusing on the social, technological, and economic aspects of the new laws and plans to hire additional personnel related to this in the coming year and 2024.

With the EU's digital regulatory bills passing the parliamentary hurdle, Big Tech companies are focusing on issues of application. Some companies have reportedly communicated with the European Commission and submitted proposals analyzing whether their own products or services, or those of competitors, fall under the scope of the laws. The WSJ reported, "With the passage of the two digital regulatory bills, there is a possibility of conflicts lasting months or years between regulators and major technology companies over how to apply them."

This content was produced with the assistance of AI translation services.