The important role of digital platforms necessitates its discussion. As this new phenomenon becomes increasingly sophisticated, the need for laws to govern it becomes more poignant. In consequence, the European Union has taken various actions towards realising this aim of regulating the digital platform horizon. This article focuses on the debate surrounding this bold step of the EU, with particular focus on the arguments of scholars, the positions of some EU member states, the position of the EU, and its policy plan towards the regulation of digital platforms.Digital platforms play a key role in our day-to-day interaction; be it economic, social, or political, they afford patrons the option of much smoother and simpler interaction with the rest of the world. Digital platforms, as a technological innovation, have made substantial contributions to the global economy and have generated substantial legal issues resulting from their dynamism.
What is a digital platform?
The definition of digital platforms has not seen much clarity. Indeed, the EU Commission has not come to an agreement on a concise definition of digital platforms.Since definitions may be useful, it is important to consider the features attributable to digital platforms to get a fair appreciation of this important technologicaltool. A digital or online platform is generally considered a two-sided or multi-sided medium where users are connected by a platform operator in order to facilitate the exchange of information or resources. Significant examples are Alibaba, Amazon, eBay, Facebook, and Uber.
Current EU regulation of digital platforms andthe social landscape of digital platforms.
Presently, within the EU, there is no uniform legal regulatory framework specifically governing digital platforms. In principle, they are presently governed by standard and well-established EU rules relating to data protection, intellectual property, consumer protection, competition, and intellectual property.Within the EU, there is mutual agreement by stakeholders that the advent of digital platforms, despite numerous advantages, poses myriad issues, including actual potential risks associated with unfair pricing, network effects, abuse of market dominance, infringement of privacy, and display of illegal content.The seemingly overwhelming question that arises: how do we regulate these platforms?
‘To regulate or not to regulate?’
There are views that digital markets are more regulated than analogue markets. This is based on the argument that, for instance, physical cash transactions are subject to less stringent measures than online transactions, thus buttressing the position that there is a need for better enforcement of existing rules within the new era of digital platforms. It is further that the digital market offers keen competition and, in addition, the financial and reputational incentives of the market are enough to ensure responsible use of data and creation of customer value, making further legislation obsolete.On the other hand, there is the argument to ‘score platforms before regulating them’. Thus, there is a need to gather factual evidence on specific concerns relating to digital platforms, which will inform the type of legislation to be adopted. Furthermore, there are suggestions for the need for specific regulation that targets evidence-based harm. This position is based on the risk of premature intervention, which may harm the innovative character of digital markets.On the ground that digital markets are consistently birthing new business models that are not regulated, the argument is that there is need for tailored regulation for each business model.
Positions of EU member states
Germany
In March 2017, the German Federal Ministry for Economic Affairs and Energy published a white paper on digital platforms. In the white paper, Germany advocates for a ‘made in Europe’ approach as opposed to individual regulation by member states. Unlike the EU, Germany advocates for the establishment of an appropriate general regulatory framework, including revision of existing competition laws to accommodate new antitrust threats.
Sweden and Italy
In a joint communication, Italy and Sweden express that a targeted assessment and response is more beneficial to the regulation of digital platforms. The position is in support of legislation targeted at specific regulatory lapses or legal uncertainties.
The Netherlands
The Netherlands expresses its position in a non-paper on the EU consultation. The Dutch government is in favour of a tailor-made regulation to address case-by-case scenarios. The Netherlands is in support of government collaboration with platform operators to reduce the risks associated with the use of these platforms. The Netherlands also encourages the need for a clearly outlined purpose for regulations, giving member states the latitude to achieve these identified objectives in diverse ways.
United Kingdom
The UK’s position is for a more flexible market that is regulated to accommodate the dynamism of the digital economy. Principally, the UK, through its Competitionand Marketing Authority, argues that the significant diversity of digital platforms makes it almost ineffective to have ‘broad-brush’ legislation or economic regulation to govern this wide spectrum.13 The country highlights the need for targeted regulation for specific harm as opposed to premature regulation. The primary focus supported is for the enforcement of pre-existing rules governing competition as well as fundamental rights such as privacy, clear standards relating to fair pricing, data protection and consumer protection, improved free trade across borders and possible deregulation to encourage innovation and market penetration by smaller companies.
Brexit and the EU regulation on digitalplatforms
Digital platforms cannot be discussed without considering the issue of Brexit and its attendant consequences in light of the UK’s position on EU regulation of digital platforms. The UK being anti-EU regulation of digital platforms creates a potential challenge for the UK when Brexit finallyoccurs; a less regulated UK digital platform market risks substantially less access to the EUmarket.
