European Union’s Escalating Regulatory Actions on Big Tech May Offer Blueprint for U.S. Legislators

The European Union is intensifying its regulatory oversight on major social media entities, with Meta (NASDAQ: META), the conglomerate behind Facebook and Instagram, now subject to a new investigation under the Digital Services Act (DSA). This recent probe underscores Europe’s commitment to rein in the unchecked digital influence of Big Tech companies, particularly in matters concerning deceptive advertising and political content.

The European Commission's inquiry into Meta focuses on potential breaches of the DSA, which became fully operational in February 2024. The act empowers regulatory bodies to impose fines as steep as 6 percent of the global revenue of non-compliant firms. Meta is not alone in facing such scrutiny, with the Commission also zeroing in on practices at TikTok and the platform known as X, formerly Twitter.

In the face of this challenge, Meta has responded by affirming their dedication to identifying and managing risks on their platforms, expressing their readiness to work with European regulators. This showcasing of cooperative intent does not overshadow the pressing issue at hand: the DSA’s mandate for tech companies to transparently manage deleterious content and advertising deceit without encroaching on free speech rights.

The European approach, demonstrated through the DSA and its implementation, contrasts starkly with the U.S., where legislators have struggled to enact similar comprehensive digital regulations. The only notable exception is a directive by President Joe Biden ordering the sale of TikTok by its Chinese parent company ByteDance within a restricted timeframe, a move singular in its kind and limited in scope compared to the EU's broad regulatory spectrum.

The EU's actions could, however, light the path for the U.S. regulatory future. The DSA's framework emphasises disclosure over content policing, a strategy that could resonate with U.S. lawmakers attempting to strike a balance between mitigating cyber risks and respecting constitutional free speech protocols.

As the United States observes Europe's unfolding regulation of Meta and other tech giants, U.S. policymakers may find valuable lessons in the EU's strategy. By focusing on transparency and accountability, European regulators address issues without breaching the principles of free expression. Such a model could be vital for U.S. legislators navigating the delicate, and often contentious, arena of tech governance.