Hefty fines stare at digital companies in Europe

Hefty fines stare at digital companies in Europe

Doubtful credentials of shady dealers and service providers and failing to regulate harmful contents on social media may spell troubles for digital companies in the various European countries.

Europe has started to tighten the noose around big tech companies by proposing hefty fines ranging between 6 and 10 per cent of their annual revenue for unfair treatment to rivals and failure to protect their users on their platforms under the next phase of technology regulations.

The European Union's draft outline for a new set of rules proposes fines up to 10 per cent of a company's global revenue if they continue to impose unfair condition like blocking businesses from accessing their own data or locking consumers into services and limiting their options for switching.

The new EU rules term the tech companies as "digital gatekeepers" in the sweeping overhaul of their existing rules under the proposed Digital Service Act.

The new set of rules also aims at updating the outdated rules governing e-commerce. The EU wants e-commerce companies to take more responsibility for goods and services being sold from their platforms, including identifying and throwing out shady traders.

It also wants the digital gatekeepers to swiftly take down illegal contests like hate speech from their platforms in order to maintain free speech requirements. Users will be given the option to lodge complain against any such post with such platforms. Any violation of the proposed new rules in this segment would attract upto 6 per cent of the company's annual turnover.

Britain which has walked out of the EU has come out with its own plans to step up vigil on harmful online material. Under the proposed new British rules, a penalty up to 1.8 million pounds ($24 million) or 10 per cent of their annual global revenue, whichever is higher, for failure to complying with the rules.; can be imposed on a social media platforms and other internet companies for their failure to promptly remove and limit the spread of harmful material like child sexual abuse or terrorist content. Social media giants such as Facebook, Twitter, Instagram and TikTok will be under strict observation and expected to company with the new rules expected to come into force in the first half of 2021. The new rules will apply to all social media and digital platforms accessible in the United Kingdom. Those failing to abide by it also risk being blocked besides forced to pay hefty fines. Besides, criminal cases against executives of such companies who fail to comply with the new set of rules are also under consideration. Executives of companies who fail to take the new rules seriously or delay in responding to the information requested from regulatory bodies could be in for trouble.

Britain also expects social media platforms to take extra measures to protect children using their platforms.

Micro social media platform Twitter recently got the bitter taste of what could be in store for it and other companies in Europe when the Data Privacy Commission of Ireland imposed a fine of 450,000 euro (5.4 lakh US dollars) for a security breach. Twitter had failed to remove a harmful post due to shortage of staff between Christmas Day and New Year Day in 2018.

Twitter accepted its mistake and has promised to remain fully committed to protecting the privacy and data of its customers.