Thierry Breton, the European Union commissioner for international market and services, explained the proposals for tackling a variety of problems associated with ‘Big Technology’. The first draft of the Digital Services Act, which will update the e-Commerce Directive. European Union could shut misbehaving tech firms out of single market.
The 20-year-old framework for digital services in the European Union is expected to be unveiled by the end of 2020. It will then need to be passed by the European Parliament and the European Council.
The bill would increase the responsibilities and liabilities of the technology companies, particularly regarding content on social media platforms.
Breton said that European Union regulators are preparing a list of activities that technology companies would be required to eliminate. It may also establish a rating system that allows the public and shareholders to score companies on factors such as tax compliance and for online platforms how quickly they remove illegal content.
Under these types of proposals, the technology companies may be forced to break up and sell some of their European operations if their market dominance is judged to be a threat to the interests of consumers and competitors.
Sanctions could be earned for serious anti-competitive behavior, such as preventing users from switching to a competitor’s platform or forcing them to use only one service. Under extreme circumstances, some technologies companies may be excluded from the single market altogether.
Breton compared today’s technology giants to banks before the financial crisis, in terms of their size and apparent unwillingness to take responsibility.
Breton also said that “There is a feeling from end-users of these platforms that they are too big to care”. “We need better supervision for these big platforms, as we had again in the banking system.”
European leaders, and other OECD leaders, are under pressure to agree on rules for the fair taxation of technology companies which can be applied internationally, in order to prevent wealthy tech companies from shifting their revenue to countries with favorable tax rates.
In the last July month, the French parliament approved plans for a digital services tax of 3% on digital companies with global revenue above €750m and French revenue of over €25m.
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