Big techs: new law regulating the sector comes into force in the EU – 03/07/2024 – Tech

The ambitious DMA (Digital Markets Law), which regulates the activity of technological giants in the European Union (EU) to create a more competitive environment, comes into force this Thursday (7).

The DMA establishes special rules for six supergiants — the five American Apple, Alphabet (Google), Amazon, Meta (Facebook and Instagram) and Microsoft and the Chinese ByteDance (TikTok) —, which will be subject to permanent supervision.

In a statement, the European Commission —executive arm of the EU— highlighted that “from today” the six giants “must fully comply with all their obligations” provided for by law.

In addition to defining a list of what these companies can do in Europe, the DMA grants the European Commission the power to impose heavy fines and even determine their division.

The six giants will have to inform the EU of any acquisition, as well as offering European users more web browser and search engine options.

Soon, users will also be able to send messages between applications, for example from Meta’s WhatsApp to services like Signal or Telegram.

From now on, the six companies must prove their compliance with the DMA and present “an independently audited description of the techniques used to define user profiles, together with a non-confidential version”.

The reports will be “carefully analyzed” by the commission, which will decide whether the measures implemented by the companies are effective in ensuring compliance with the law.

If this does not happen, the commission can impose fines of up to 10% of a company’s global annual revenue, a penalty that can reach 20% in the case of a repeat offense.

In the statement, the European Commissioner for the Internal Market, Therry Breton, stated that the day represents a “turning point for the European digital space”.

For Bram Vranken, researcher at the Corporate Europe Observatory, “getting big technology companies to comply with these new rules will be a huge task.”

Eight years after the data protection law, “the EU is still fighting for Facebook to respect the privacy of millions of people in Europe”, noted the expert

In 2023, Brussels imposed a fine of 1.2 billion euros (around R$6.29 billion at the time) on Meta for data privacy violations.

In this scenario, analysts recognize that it may not be realistic to expect full and immediate compliance.

“We will see some compliance, full compliance from some companies. But I believe there will be cases of non-compliance,” said commission vice-president Margrethe Vestager, adding that the bloc will not hesitate to use the toughest measures provided for in the law.

Difficult application

EU countries are pressing the European Commission to focus its efforts on complying with at least nine important laws covering the digital space, created since 2019.

Analysts, however, urge the EU to be realistic about the resources it will need. “MEPs underestimate the challenge of implementing and enforcing the recent wave of digital laws,” said Zach Meyers, of the Center for European Reform think tank, in a February report.

According to Meyers, the sheer volume of new laws “creates the risk that the Commission and national authorities will not have the resources to implement them adequately.”

Vestager has already highlighted that the commission is reinforcing inspection, but recognizes that it is necessary to establish priorities between cases.

The commission currently has 80 people monitoring compliance with the DMA, according to a spokesperson for the institution.

At the same time, it has 123 full-time employees focused on applying the DSA (Digital Services Act), a content moderation law that complements the DMA.

Meta and TikTok admitted in 2023 that each had more than 1,000 people working on implementing the DSA.

Google claims to have “thousands of engineers” working just to comply with the DMA.