Europe has laid out sweeping new tech regulation that could see big firms face huge fines in a further crackdown on big tech companies.
The European Commission today set out two new pieces of legislation as it looks to curb the power of some of the world’s most popular firms.
The EU has long had concerns over the growing influence of firms and the knock-on effect on smaller startups.
European Competition Commissioner Margrethe Vestager and EU Internal Market Commissioner Thierry Breton today announced plans for the Digital Services Act.
It will widen the requirements to define areas of additional responsibility around content, particularly illegal content.
The legislation will also force companies to be transparent on the algorithms used for rankings on products they feature or recommend.
It comes after the UK Government announced plans to hand Ofcom considerable powers over social media firms.
The regulator will be able to fine companies failing in their duty of care up to £18m or 10 per cent of their annual global turnover.
Meanwhile, in the US, nine companies, including the above, have been ordered to hand over information as part of a probe into consumer privacy.
The Commission also announced details of its Digital Markets Act with the end goal of fostering competition in the market. It is expected to apply to the big players like Google and Amazon.
Under the proposals set out today big tech firms could be fined between six per cent – under the Digital Services Act – and 10 per cent – under the Digital Markets Act – of global annual turnover.
Currently companies can only be fined up to four per cent of turnover under the existing GDPR regulations.
EU Internal Market Commissioner Thierry Breton dismissed suggestions the new rules could be discriminatory.
“Everybody is welcome in Europe. Our responsibility is to give direction, rules to protect what is important to us,” he told a news conference.
Regulatory scrutiny has been growing across the worldwide after concerns over privacy as well as complaints that they abuse their market power.
The US Federal Trade Commission recently announced nearly every US state sued Facebook claiming the tech giant had broken antitrust law.
In the complaint, the 46 states, Washington DC and Guam also asked for Facebook’s acquisitions of Instagram and Whatsapp to be judged to be illegal.