Big Tech Companies Could Face Hefty Fines Under New EU’s Digital Services Act Law

To curb the menace of managing illegal online content, the European Union will be introducing Digital Services Act law within a year. Therefore, if a technology company breaches the legislation, it would put them in severe trouble. European Union will slap big tech giants with hefty fines – as much as billions of dollars upon breaching the new regulation.

The competition chief at EU, Margrethe Vestager, said in a statement:

“With the DSA, we help create a safe and accountable online environment. We ensure that with today’s agreement, platforms are held accountable for the risks their services can pose to society and citizens”

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Digital Services Act will be here to stay

Primarily, the Digital Services Act will be introduced for big tech companies so that they can monitor disinformation, hate speech and other harmful content which gets viral on their platform. Therefore, companies would be required to police themselves more effectively besides making it easier for the users to flag problems. The new rules are designed specifically to protect the fundamental rights of the internet users.

Any sort of noncompliance will cost companies as much as 6% of their global annual sales. To put things in perspective, Amazon could face a fine of mammoth $28 billion in case they do not compliance with Digital Services Act. This colossal figure was based on Amazon’s 2021 reported annual sales. Moreover, if a company becomes a frequent offender then it could be barred from operating in the European Union.

It is pertinent to state that all websites shall be accountable to the new Digital Services Act. However, companies with over 45 million users in the EU will have to abide by firmer rules. The whistle-blower at Facebook, Frances Haugen said that the Act will represent a ‘global gold standard’ for regulating social media companies.

At least 27 EU countries need to sign-off this law before it is finally official sometime later in the year. Big firms will have four months to comply with the new law. However, smaller companies can apply for exemption from specific rules. Every other company – in between large and smaller firms – will have 15 months to abide by the rules.

One of the big tech giants Google has welcomed the objectives under the new Digital Services Act. The company has made sure to work with policymakers in order to safeguard that the law is applicable for everyone.

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