Introducing DSA, DMA and Europe’s reasoned protectionism

The Les Echos newspaper published this article online on October 23, 2023

Out with the Far West’s digital domination…

That’s the crux of the message behind the European Union’s (EU) recent legislation on digital technologies. Whether it’s the Digital Services Act (DSA), the Digital Market Act (DMA), the Data Governance Act (DGA) or the more dated General Data Protection Regulation (GDPR), acronyms evolve, while the core purpose remains unchanged: to develop a safe, transparent and fair cyber playing field for one and all Europeans.

True to its principle that anything illegal offline should also be online, the EU seeks to safeguard the basic human rights of Internet users and consumers alike. Such legislation is also geared toward Internet players who grapple with the dominance of Big Tech, located in all corners of the globe. It comes as no surprise that the GAFAM (Google (Alphabet), Amazon, Facebook (Meta), Apple and Microsoft) empire sits high on the list of targets. But they’re not the only ones.

Across the board, tech companies must play by the new rules. Failure to do so will incur punishing penalties, namely fines up to 6% and 20% of global revenue for non-compliance with the DSA and DMA legislation. What better way to keep a low profile or steer clear of Europe, much to the detriment of users who would then be denied such services?

Exploring the ‘regulatory hubris’…

Quick analysis will point to Europe’s entrapment in a ‘regulatory hubris,’ stifling all forms of creativity. An Old Continent that’s a parody of herself, conforming to the received idea that “America does the innovating, China the copying and Europe the regulating!” To bridge the digital divide, Europe’s time would be better spent driving innovation than plugging regulatory inflation.

In some areas of expertise, Europe is unquestionably behind the times. A closer look reveals the pragmatism in deciding to regulate the digital sphere by championing principles of democracy. By formalizing its DSA and DMA legislation, the EU aims to boost its competitive streak worldwide, depending less on foreign players before ultimately cementing its status as a digitally sovereign region. It’s why Europe bolstered its ideological position with consequential punishments that are a match for any continent! The EU has resoundingly illustrated its political stance by exposing Big Tech, exactly where it hurts them most.

Shielding and promoting startups

The ramifications of this positioning will serve to protect EU-based companies, providing a potential boost to Europe’s ecosystem. Together, the Old Continent’s startups and SMEs would finally be able to flourish, in contrast with the current head-on battle they face as they compete with tech’s supersized giants. Acting as an offensive and defensive strategy in response to Europe’s competitors, the new legislation is expected to add value to EU Member State investments while delivering a competitive advantage.

Not sheepish in making its case heard, the EU is increasingly carving out a third way on the global stage. Against the background of Trump’s America First – and more recently Biden’s America Only – not to mention China’s firmly established nationalism, at long last Europe appears to be adopting reasoned protectionist measures, looking after its own citizens while boosting its economy.