A global satellite system that doubles as a universal translator. A pope who uses it to spread a message of peace in several languages simultaneously in the hope of preventing the world from fragmenting. If critics paid attention when “Vatican III” was published in 1985, they dismissed the novel by Thierry Breton, now European Union commissioner for the internal market, as a project of literary vanity typical of leaders ambitious Frenchman. However, “Vatican III” seems prescient today. Although the European Commission, the EUof the executive, may not be building a virtual equivalent of the Tower of Babel, Mr. Breton and other Eurocrats want to spread their own digital gospel universally and cement the EUas a global digital über-regulator.
The telecom-computer machine of Mr. Breton’s novel finally proves to be a success. Let the same be said of EUEvangelical digital regulation is another matter. The EU may have passed, or at least drafted, the most important digital laws in the world. But now he faces the considerably more difficult task of enforcing them. As if to mark this new stage, the commission opened an office in San Francisco on September 1, a kind of embassy to work with companies in Silicon Valley.
The EU did not seek the role of global digital regulator, but was sucked into it by a phenomenon called the “Brussels Effect”, named after a book by Anu Bradford of Columbia Law School, which makes the EU the default global regulator. America is too politically paralyzed to play this role; China disqualifies itself by its authoritarian leanings. In Brussels, on the other hand, the power of lobbyists is more limited and mandarins tend to know their files; this often results in regulations that other countries can rely on. As for global companies, they have no choice but to comply if they hope to sell in one of the largest digital marketplaces.
Until now, the symbol of the EUthe power to regulate the technology has been the General Data Protection Regulation, or GDPR. This privacy law requires, among other things, that individuals give explicit consent before their data can be processed. In effect since May 2018, it has taken the world by storm. Graham Greenleaf of the University of New South Wales says nearly 160 countries have passed legislation “significantly influenced” by it. A pair of other laws, however, which the European Parliament passed in early July, are likely to rival it: the Digital Services Act and the Digital Markets Act, which will start to come into force next year. The dsa deals with issues such as hate speech, illegal products and advertising. The dma defines a new class of dominant “gatekeeper” platforms primarily run by American tech titans – and prohibits them from engaging in practices deemed uncompetitive, such as giving preference to their own services or preventing their instant messaging services to interact with their rivals.
Yet the GDPR has already shown how difficult it is to hold such numerical rules. Enforcement has been slow, at least when measured in fines. Since 2018, penalties have amounted to nearly 1.7 billion euros ($1.7 billion) in about 1,200 cases, according to cms, A law firm. Although the cumulative fines imposed on the main targets of the regulations, the American titans of technology – Alphabet, Amazon, Apple, Meta and Microsoft – have reached 1.3 billion euros, it is less than a thousandth of that that they collectively achieved in sales last year.
The main reason for this relative indulgence is the way the EU set up execution. Cross-border cases are handled by the data protection authority of the country in which the company is based. This should make the Irish Data Protection Commission the EUThe strongest privacy watchdog: All major tech European headquarters except Amazon are based on the Emerald Isle. Yet, much to the chagrin of privacy advocates, the country has proven to be a bottleneck. He is under-resourced and unsure how aggressively he should go after companies that provide lots of local jobs and tax revenue. To avoid the same regulatory deadlock with the new dma and dsa, the commission now assumes the role of executor. He has already started building what will amount to a new industry watchdog. It will eventually have some 220 civil servants, contractors and national experts. It will have its own funding, through a levy on the companies it regulates, and a bespoke software platform to track cases.
“We are ready,” Mr. Breton said in a blog post recently. Observers are not so sure. Even if the organization works as planned, its regulators have their work cut out for them. They will probably only have a dozen companies to oversee. But assuming great goalkeepers have to comply with all dma‘s 21 bonds, there will only be 0.7 staff for each bond and custodial firm, calculate Christophe Carugati and Catarina Martins of Bruegel, a Brussels-based think tank. Such a ratio may suffice if companies are playing ball. But unlike the GDPRmany of dmaBonds go to the heart of their business models.
Then again…
If the application of the dma and dsa proves too weak, Brussels could face increasing competition from Great Britain and the Beltway. In the case of GDPR, some countries have already started to deviate from its trajectory. Britain is working on a lighter version. The often dysfunctional US Congress may soon succeed in passing a federal privacy law, the American Data Privacy and Protection Act, which improves the GDPR. In its current form, it would hold bosses personally responsible for privacy breaches.
All of this suggests that the premises of Mr. Breton’s book and the so-called Brussels Effect may be wrong. A central player, no matter how well placed, cannot unify digital. Instead, a different claim in Mr. Breton’s novel may be true: that digital technology will lead to the fragmentation of the world into what he calls “logical continents”. For a detailed explanation of what could be done about it, interested readers may have to wait until he leaves Europe’s capital, giving him time to write another novel. ■
Read more from Charlemagne, our columnist on European politics:
As war in Ukraine drags on, costs to Europe mount (August 25)
What the EU looks like after a decade of horrors (August 18)
Climate change is bad news for a continent that does not like change (August 13)
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