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INTERNATIONAL CO-OPERATION BETWEEN REGULATORY AUTHORITIES WILL BE VITAL IN REGULATING ONLINE PLATFORMS

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The digital services landscape has dramatically evolved over the past few years; therefore, it is important that the legal framework that regulates them keeps pace with these changes. Online platforms bring about significant benefits for consumers and encourage innovation as well as opening up new business and market opportunities. However, they also generate new risks such as exposure to a range of illegal goods, activities, or content which need to be addressed to ensure users remain safe online without restricting business innovation, and there are also growing concerns over the lack of openness and neutrality of these platforms.

In an era where online content is increasingly user-generated, the responsibility for removing illegal and harmful content, as well as disinformation and fake news, is increasingly lying with the platforms themselves which have been facing ever-increasing criticism regarding their role in protecting the public.The main regulatory challenge is how to achieve a more level playing field without undermining freedom of expression or hindering innovation and the user experience. In addition, the digital economy is not restricted by boundaries and spans many different jurisdictions around the world, which has created difficulties when it comes to regulation. Regulators have been grappling with ways in which to update the regulatory environment to better reflect technological developments. Often this has been in the form of voluntary self-regulation, but this hasn’t been effective. Therefore, recently there has been more prescriptive approaches targeting online content and harms in several countries such as the UK and Australia as well as fragmented activity across the EU.

The European Commission has taken steps toward creating a harmonized approach to regulating online platforms at a regional level. It announced a Digital Services Act package in June 2020 as part of its European Digital Strategy in an effort to foster innovation and competitiveness for the European online environment. The existing legal framework for digital services in the EU has been unchanged since the adoption of the e-Commerce Directive in 2000. This Directive has formed the foundations for regulating digital services across the region for the past 20 years. As part of the new Digital Services Act, the EC is now planning to propose clear rules that set out the responsibilities of digital services to address any risks and protect users’ rights. These include legal obligations that ensure the supervision of platforms and guarantee effective enforcement. It also proposes ex ante rules for large online platforms acting as gatekeepers, which ensures that platforms behave fairly and can be challenged by new entrants as well as existing competitors, to improve consumer choice.

However, even at a regional level introducing suitable regulation will be challenging, and the EU will come up against many obstacles when trying to address some of the issues, for example when it comes to regulating illegal and harmful content online. For a start, content defined as “illegal” is not necessarily harmonized across member states and agreeing on a definition for “harmful” will also prove problematic. The EU may find it easier to leave these definitions up to individual member states. Ultimately though, considering the global nature of digital platforms and the flow of data over national boundaries, regional collaboration will not be enough; international co-operation between competition authorities will be vital.

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- Contributed by knowledge partner: OMDIA