European lawmakers came to an agreement early Saturday in Brussels on a legislative package that will impose major new obligations on how Big Tech companies handle content on their platforms — and big fines if they fail to comply.
Why it matters: It's another aggressive step forward on tech for Europe, which has led the way in regulating the digital age and has already set the tone for how the world deals with online privacy and competition.
Driving the news: EU lawmakers came to a political agreement on the Digital Services Act (DSA) after hours of deliberation, hammering out final details of the proposal.
- Per an announcement from the European Council, the DSA follows the principle that what is considered illegal speech in Europe should also be considered illegal speech online, and it places new obligations on all online content hosts providing service in Europe.
- New rules will aim to stem the flow of misinformation, require transparency, and limit some kinds of targeted ads.
What they're saying: "It's not a slogan anymore, that what is illegal offline, should also be seen and dealt with as illegal online. Now it is a real thing," Margrethe Vestager, executive vice president of the European Commission and head of competition, said on Twitter.
- The DSA is "helping us to get our rights and to feel safe when we're online," she said.
The big picture: The DSA follows Europe coming to a political agreement on the Digital Markets Act, a major competition package, last month.
Details: The size of a company's business will determine which of the new rules apply. Services with more than 45 million active users in Europe will face the strictest requirements.
- The largest platforms and services will have to perform a yearly analysis on reducing risk associated with "dissemination of illegal content, adverse effects on fundamental rights, manipulation of services having an impact on democratic processes and public security and adverse effects on gender-based violence, and on minors and serious consequences for the physical or mental health of users."
- Online marketplaces will have a new "duty of care," obligating them to new transparency rules.
- Misleading interfaces, sometimes called "dark patterns," will be prohibited under the DSA.
- Platforms will have to let users opt out of recommendations based on their history and other information. There are also new rules around responding to misinformation about breaking news event and protection measures for minors.
- Platforms that fail to follow the rules could be subject to fines of up to 6% of their gross revenue, which for companies like Alphabet (Google) and Meta (Facebook) could add up to billions of dollars.
What's next: The agreement will have to pass the European Council and Parliament, which is nearly guaranteed to happen.
