The European Union has a new legislation to regulate tech giants. On Saturday, April 23, the Union agreed on the terms of the Digital Services Act (DSA), which will force tech giants to take responsibility to content that appears on their platforms.
The new rules include removing illegal content more quickly, and explaining to users and researchers how their algorithms work, further taking stricter action on the spread of misinformation. Companies could face fines of up to 6 percent of their total annual turnover for not complying with the new laws. “The DSA will upgrade the ground-rules for all online services in the EU," the European Commission President Ursula Von Der Leyen was quoted as saying in a statement.
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The DSA is similar to the Digital Markets Act or DMA that was agreed upon in March. While the DMA focuses on creating a level playing field between businesses, the DSA focuses on how companies handle and regulate content on their platforms. The legislation only applies to EU citizens, but reports suggest that the effects will be felt in other parts of the world as well.
EU has said that the DSA will have a numver of obligations like targeted advertising based on individuals’ religion, sexual orientation, or ethnicity will be banned. Further, minors can not be subjected to targeted advertising. Further, “Dark Patterns" will be prohibited. “Dark Patterns" are referred to confusing or deceptive user interfaces designed to steer users in making certain choices. The Union has said that as a rule, cancelling subscriptions should be as easy as signing up for them.
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The DSA also says that large platforms like Facebook will have to make the work of their ‘recommender’ algorithms transparent to users. Users should also be offered a recommender system “not based on profiling."
Hosting services and online platforms will also have to explain clearly why they have removed illegal content, as well as give users the ability to appeal such takedowns. The DSA itself does not define what illegal content is, and is leaving that for individual countries to decide themselves.
Apart from this, larger online platforms will have to provide key data to researchers to “provide more insight into how online risks evolve and online marketplaces must keep basic information about traders on their platforms to track down those who are selling illegal goods and services. Furthermore, large platforms will also have to introduce new strategies for dealing with misinformation during crisis.
The DSA is said to distinguish tech companies of different sizes, placing greater obligations on bigger companies. Those with at least 45 million users in the EU like Facebook and Google will face the most intensive scrutiny.
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While the terms of the Digital Services Act have been agreed upon by member states, the final text of the legislation is yet to be released. The rules will apply to all companies after 15 months of being passed, or January 1, 2024, whichever is earlier.2
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