Final EU Digital Services Act promises transparency of recommendation algorithms and new restrictions on targeted advertising
EU lawmakers have accepted the final conditions on the Digital Services Act, a new law that focuses on large social media and retail platforms. The full text has not yet been made public, but the European Parliament and the European Commission have defined some of its main terms; these include new restrictions on how targeted advertising can use sensitive personal information, a ban on dark patterns, and a requirement that the inner workings of recommendation algorithms be visible to the public.
Digital Services Act moves forward with final terms, awaits final vote
The Digital Services Act has moved in parallel with the Digital Markets Act, which received similar agreement on its terms in late March, as a legislative check on the powers of major media ‘gatekeeper’ platforms. social media, messaging and online retail spaces. The terms were defined between the European Parliament, the Council and the Commission in proposals dating back to early 2021.
While these bills focus on so-called gatekeepers, which were previously defined as platforms with at least 45 million monthly active users, certain Digital Services Act terms relating to the processing of personal information also seems to be applicable to smaller platforms.
The full text of the Digital Services Act has not yet been made available to the public, but the European Parliament has listed many of its key terms in press releases. One of the main elements is “algorithmic accountability,” which requires under-the-hood scrutiny of processes that use user activity and personal information to provide recommendations on things like new videos to watch or products. to buy. There are also many new safeguards aimed at reducing a range of illegal activities and more necessary measures of user control over personal data.
The fines are also heavier than those listed by the General Data Protection Regulation (GDPR), and the app is handled in a different way. Gatekeeper class violators will respond directly to the European Commission and face maximum penalties of up to 6% of annual worldwide turnover.
Recommendation algorithms in focus
One of the main elements of the Digital Services Act is the requirement that recommendation algorithms be more transparent to lawmakers and the general public. The European Commission requires access control platforms to provide it and EU member states with access to the inner workings of recommendation algorithms for review, and the public will also receive more information about them.
Although intended for EU residents, this particular article will impact the operations of major tech companies around the world. It is likely that the big platforms will simply implement universal policies that voluntarily provide users in other countries with more information about recommendation algorithms; even if they don’t, more information about the technical innards of these platforms will inevitably make its way to the rest of the world.
The Digital Services Act also states that the end user must be offered at least one recommendation algorithm option that is “not based on profiling”, or any type of information typically collected for targeted advertising. . A simple model is the “chronological feed” which lists all posts from those on a user’s next list in the order in which they were posted, rather than engaging a recommendation algorithm as a filter. This type of feed was more common on social media platforms around the early 2010s, and many (including Twitter and Instagram) have already reintroduced it as an option.
Stricter regulation of recommendation algorithms is based on growing concerns about the the subtle harm they can do. Cases have been presented that recommendation algorithms tend to promote more sensational and extreme content, allow the spread of misinformation, discriminate by design, and lead users down a “rabbit hole” of ideological content from more and more divisive which can ultimately radicalize them.
Targeted advertising also faces tighter restrictions
Already subject to substantial GDPR restrictions and growing voluntary limitations imposed by companies such as Apple, the targeted advertising industry is not getting any good news from the Digital Services Act.
Targeted advertising is completely prohibited from using certain categories of sensitive personal information: a recent press release cites sexual orientation, religion, and ethnicity as specific examples. It is also forbidden to target minors. The bill also promises all users “greater control” over how personal data is used.
The “dark patterns” that often govern the process of disabling information sharing are also completely prohibited. And users should now be able to opt out of services that use targeted advertising as easily as they have subscribed to them.
In addition to restrictions on targeted advertising, merchant platforms will also face stricter requirements to identify and remove illegal products and services. Notices of collection of personal information for targeted advertising must also be non-arbitrary and non-discriminatory and respect fundamental rights such as freedom of expression and data protection.
Mandar Shinde, CEO of will erase, hopes to see this decision stimulate similar legislation in the country of origin of most of these giant technology platforms: “It is a step in the right direction; while businesses and consumers benefit from these large platforms, it is important to control their power. The archaic laws of the United States established in the late 90s are no longer relevant in 2022. Steps can be taken to hold them accountable like this new legislation passed by the EU, but the United States is slow to make progress on this. forehead. The Digital Services Act ensures that consumers and businesses benefit while being protected, even at the expense of shareholders – which has really been the sole purpose of these companies. »
The Digital Services Act is currently being scrutinized by legal and technical experts before going to a final vote by the EU Parliament and Council, a process she should easily clear up. It would enter into force 20 days after its publication in the Official Journal of the EU and its application would start 15 months after that time, although an unspecified “longer adaptation period” for the small and medium-sized enterprises concerned has been promised. .