content regulation / Copyright / Data protection / immunities / Internet intermediaries / ISPs / notice-and-take down

The EU Commission and its draft Communication on online platforms: sectorial voluntary action and soft law are the winners of the regulatory challenge!

dg connect

The topic of intermediary liability is a hot topic these days, with different types of institutions already having had looked, or still looking, at how to interpret/amend/improve the EU intermediary liability legal and regulatory regime.

The European Commission [EC] fuelled this debate with its Communication of 6 May 2015 on ‘A Digital Single Market Strategy for Europe’, which introduced a new category of actors: ‘online platforms’.

Meanwhile, the European Court of Human Rights (ECtHR) has had to deal with two important cases touching on this exact issue: the infamous Delfi case (discussed here); as well as the MTE case (discussed here), somewhat attempting to soften the edges of the Delfi case [“Success is stumbling from failure to failure with no loss of enthusiasm” once said a pragmatic man!].

As explained in my previous posts [here and here], the EC questioning could have led in different directions, one of which would have been the imposition of a duty of care on certain types of intermediaries, starting with online platforms. As Recital 48 of the e-commerce Directive suggests, this might be a necessary regulatory instrument to be applied at national level:

“(48) This Directive does not affect the possibility for Member States of requiring service providers, who host information provided by recipients of their service, to apply duties of care, which can reasonably be expected from them and which are specified by national law, in order to detect and prevent certain types of illegal activities”.

A few days ago, Politco leaked a draft version of what could soon become, most likely by the end of May 2016, the new Communication on ‘Online Platforms and the Digital Single Market -Opportunities and Challenges for Europe’. This document is dated 25 April 2016. [Our readers will remember that, while being non-binding legally, EC Communications acts as roadmaps, setting out the Commission’s future work in a legal/regulatory area that falls within its competence].

What are the most interesting points put forward in this soon-to-become Communication, at least from the standpoint of intermediary liability?

  1. Now it is certain, online platforms will become famous soon! But what are online platforms? A slightly different (and it would seem narrower) definition is introduced in this document which covers “undertakings that are capable of facilitating direct interactions between users [users include both businesses and private consumers] via online systems, and that capitalise on data-driven efficiencies enabled by network effects”. The EC nevertheless warns the reader: “this definition is neither closed nor exhaustive”. That said, some activities are expressly excluded: “online activities that are limited to retailing or single-sided content distribution, e.g. Netflix, are not directly covered by the definition, as they do not involve direct contacts between different users. Industrial platforms are also not within the primary scope of this Communication, as they focus on bringing various stakeholders together for agreements on specific technical issues, rather than focusing on direct transactions between different third-parties”. To (over)simplify, this Communication is for the Youtube, Dailymotions, Facebook and Twitter of this world [which are not targeted by the Audiovisual Media Services Directive that is concerned only with services which are under the editorial responsibility of a media service provider]! While online platforms are described as “magnets for innovation” [If the EC is becoming pragmatic, it is also poetic!], we are not in wonderland yet! Adverse effects are felt by both businesses and consumers. Hence the need to adopt a proper strategy!
  2. The EC stresses again [it started with the old e-signature Directive if I remember it well] the importance of the country-of-origin principle to make sure online platforms are governed by only one set of rules, as well as the principle of maximum harmonisation. [One question: is the e-commerce Directive really embodying the principle of maximum harmonisation when it comes to intermediary liability exemption? Looking at the way English law has evolved, I am not entirely sure].
  3. There seems to be a strong case for treating so-called “over-the-top” (OTT) online communications services and telecommunications operators the same way, although this solution seems to be, a least partially, the upshot of a consultation that is not closed yet (i.e. the consultation on the e-privacy Directive). [Could it be that the EC is convinced that the e-privacy Directive does embody a strong principle of confidentiality?] The EC identifies two ways to treat these services alike: either by extending existing rules to OTT, such as the e-privacy Directive; or by de-regulating the telecoms sector.
  4. It is written clearly in the draft Communication that “the Commission intends to preserve the existing liability” to be found in the e-commerce Directive! In other words, the horizontal approach is saved but and there is a big BUT, the EC is seriously considering additional sectorial actions: “the Commission considers that specific regulatory action would be more effective through sectorial legislation, on the basis of maximum harmonisation and a problem-driven approach, and without prejudice to the e-Commerce Directive”. [Is this a way of saying bye-bye to the duty of care, or at least a general duty of care?] The EC identifies three fields, in particular, which could require additional sectorial intervention: copyright, protection of minors, and harmful content. [Why is it that copyright always come first?!? Just wondering somehow naively…]
  5. And here is the cherry on the cake, since it would seem that if this point works well, the previous option could potentially be less important: “there is a need to further encourage all types of online platforms to take more effective voluntary action to safeguard key societal values” writes the EC, “in order to effectively fight hate speech and ensure non-discrimination, or to ensure transparent, fair and non-discriminatory access to information in the context of democratic processes, especially where this information is filtered via algorithms, or manipulated through opaque moderation processes”. [Does it mean that hard law becomes useless? Maybe not entirely… how can we make these platforms regulate in a transparent manner? Besides, such a finding clearly begs the question asked in my earlier post whether we finally need a ‘good Samaritan’ exemption for online platforms, although the EC seems to think that by issuing guidance on this point it will solve the matter!]) Later on in the Communication, the EC speaks even louder: “The Commission considers at this stage that immediate and effective action by industry is needed to fight incitement to terrorism and to prevent cyber bullying”. [It would be really interesting to know what the EC has in mind for regulating these types of content!]
  6. Finally, there is no recommendation for a notice-and-action procedure yet! Apparently the EC needs more time to think about this: “The Commission will continue to review the need for formal notice-and-action procedures during the second half of 2016, taking into account the effect of the updated audiovisual media and copyright frameworks on illegal content online”. [Could it be that, once again, the answer has to be sectorial? Would it be useful to compare and therefore get meaningful facts on notice-and-action procedures implemented in the field of both copyright and data protection? Should the potential of automation be considered as well? For an example see here].

What do we think of the work of the EC’s Directorate-General ‘DG Connect’? It is clear that DG Connect has had the difficult task of finding a decent position stuck right in the middle between its neighbouring EC DGs: ‘DG Growth’ (dealing with IP related issues and in particular copyright); and ‘DG Justice’ (dealing with data protection issues); while all under the watchful eye of ‘DG Competition’ (dealing with competition law issues). Could we call DG Connect people pragmatic chaps?

Sophie Stalla-Bourdillon

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2 thoughts on “The EU Commission and its draft Communication on online platforms: sectorial voluntary action and soft law are the winners of the regulatory challenge!

  1. Pingback: The EU Commission and its official Communication on Online Platforms: is the e-commerce Directive being attacked by the back door? | Peep Beep!

  2. Pingback: The EU Commission and its official Communication on Online Platforms: is the e-commerce Directive being attacked by the back door? – Sophie Stalla-Bourdillon | Inforrm's Blog

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