The European Union reached a deal on Saturday on landmark legislation that would force Facebook, YouTube, and other internet services to combat misinformation, disclose how their services amplify divisive content, and stop targeting online ads based on a person’s ethnicity, religion, or sexual orientation.
The law, called the Digital Services Act, is intended to address social media’s societal harms by requiring companies to more aggressively police their platforms for illicit content or risk billions of dollars in fines. Tech companies would be compelled to set up new policies and procedures to remove flagged hate speech, terrorist propaganda, and other material defined as illegal by countries within the European Union.
The law aims to end an era of self-regulation in which tech companies set their own policies about what content could stay up or be taken down. It stands out from other regulatory attempts by addressing online speech, an area that is largely off limits in the United States because of First Amendment protections. Google, which owns YouTube, and Meta, the owner of Facebook and Instagram, would face yearly audits for “systemic risks” linked to their businesses, while Amazon would confront new rules to stop the sale of illegal products.
The Digital Services Act is part of a one-two punch by the European Union to address the societal and economic effects of the tech giants. Last month, the 27-nation bloc agreed to a different sweeping law, the Digital Markets Act, to counter what regulators see as anticompetitive behavior by the biggest tech firms, including their grip over app stores, online advertising, and internet shopping.
Together, the new laws underscore how Europe is setting the standard for tech regulation globally. Frustrated by anticompetitive behavior, social media’s effect on elections, and privacy-invading business models, officials spent more than a year negotiating policies that give them broad new powers to crack down on tech giants that are worth trillions of dollars and that is used by billions of people for communication, entertainment, payments, and news.
“This will be a model,” Alexandra Geese, a Green party member of the European Parliament from Germany, said of the new law. Ms. Geese, who helped draft the Digital Services Act, said she had already spoken with legislators in Japan, India, and other countries about the legislation.
A deal was reached by European policymakers in Brussels early Saturday after 16 hours of negotiations. “Platforms should be transparent about their content moderation decisions, prevent dangerous disinformation from going viral and avoid unsafe products being offered on marketplaces,” said Margrethe Vestager, who has spearheaded much of the bloc’s work to regulate the tech industry as the executive vice president of the European Commission, the executive arm of the European Union.
The moves contrast with the lack of action in the United States. While U.S. regulators have filed antitrust cases against Google and Meta, no comprehensive federal laws tackling the power of the tech companies have been passed.
An estimated 230 new workers will be hired to enforce the new laws, a figure that critics said was insufficient when compared with the resources available to Meta, Google, and others.
The staffing figures “are totally inadequate to face gigantic firms and new gigantic tasks,” said Tommaso Valletti, a former top economist for the European Commission, who worked on antitrust cases against Google and other tech platforms.