Tightening its hold on online platforms operating within its borders, the European Union has recently added updates to its Digital Services Act (DSA). Earlier on, only giants like Meta or Google faced heat under the DSA but now, almost all platforms reaching a sizeable audience in the EU will fall under the jurisdiction, significantly expanding its reach and potential impact.
This decision was prompted by growing concerns over the spread of illicit content in the EU including illegal content, misinformation and unnecessary power yielded by larger tech companies. The act originally governed only firms reaching 10% or more of the EU’s total population. That is now changing with all but the smallest organizations falling under the jurisdiction of the act. Businesses with fewer than 50 employees and €10 million in annual revenue will not be affected by this change.
What does this mean for businesses?
- Platforms under the DSA’s jurisdiction must now:
- Provide users with a way to report unlawful content, so that it may be removed quickly.
- Make content moderation choices more transparent by giving users justifications and avenues for appeal.
- Offer the choice to opt out of personalized advertising and avoid using sensitive categories like sexual orientation or ethnicity to target children with advertisements.
- Put in place age verification procedures to keep children safe online.
- Strengthen protocols to protect electoral integrity from cyber-attacks.
- To prevent fraud and unlawful activity, make sure that companies using internet markets can be tracked down.
Wider Implications and Industry Reaction:
News of this expansion has sent shockwaves through the online business community with numerous concerns ranging from unnecessary compliance issues for smaller businesses to potential suppression of innovation in the future. The tech industry expresses uncertainty about the act’s capability to also act as a hurdle in legitimate activities and free expression. Despite acknowledging the dire need for regulation.
How is the future looking ahead for the EU?
This act’s updates also bring their share of opportunities and challenges. Businesses already operating inside the EU must find ways to adapt to the new regulations which require careful planning out and resource allocation. But at the same time, adapting to these changes can positively lead to enhanced user trust, boosted brand reputation, and long-term sustenance in the European Union.
More countries around the world are likely to be inspired by the EU’s move and spurn similar regulatory actions, molding a new way to shape the future of online platforms and content governance across the world. The one certainty we can take from this is that the level of digital transformation rapidly taking place is massive and businesses must adapt and evolve to navigate the dynamic regulatory environment in the making.