Digital Transformation is one of the six priorities of the European Commission for 2019-2024. The European Union’s digital strategy aims to support people and businesses through the transformation, set strong regulatory standards and support the target of a climate neutral Europe by 2050. This Just the Facts outlines some of the recent major EU digital developments.
Artificial Intelligence (AI) refers to technologies programmed to analyse the world around them and take action to achieve specific goals. AI can bring a wide array of societal and economic benefits, but also new risks and negative consequences.
The European Commission has proposed a set of actions to build ‘excellence and trust’ in artificial intelligence, including the first ever legal framework on AI. In April 2021, the Commission introduced a proposal for an AI Act. It aims to address the risks that AI may bring about and categorises these risks into four different levels: unacceptable risk, high risk, limited risk and minimal risk. For example, anything considered a clear threat to EU citizens will be banned, such as toys using voice assistance which encourage dangerous behaviour in children. The use of AI in high impact sectors such as health, migration and justice will be carefully assessed and monitored before and during being put on the market. Negotiations on the Act are expected to continue into 2023, with implementation of the Act expected by late 2024 or early 2025.
The European Commission, along with EU Member States, have also developed a Coordinated Plan on Artificial Intelligence. The plan was first introduced in 2018 and was updated in 2021. It aims to increase investments in AI, to ensure the implementation of AI strategies and to align AI policies across the EU.
The EU works in several ways to promote cyber resilience and to ensure that online spaces are safe and secure for European citizens. The European Commission presented the EU Cybersecurity Strategy in December 2020. The Strategy focuses on building collective capabilities to respond to major cyberattacks, particularly in the areas of law enforcement, diplomacy, defense and the internal market. It also focuses on increasing EU cooperation with partners across the world who share similar values. The European Commission has also introduced other legislation such as the NIS Directive, which provides for the creation and cooperation of cybersecurity bodies in Member States, and the Cybersecurity Act, which includes an EU-wide cybersecurity certification framework for ICT products, services and processes.
The European Data Strategy aims to create a single market for data. Nine common European data spaces will be created which aim to ensure that more data becomes available for use while giving more control to those who generate data. European rules, especially those relating to privacy and data protection, as well as competition law, will apply to these spaces. The purpose of the single market for data is to allow the EU to become an ‘’attractive, secure and dynamic’ data economy.
A key pillar of the European Data Strategy is the European Data Act, which was proposed by the European Commission in February 2022. It aims to make more data available for the benefit of companies, citizens and public administrations by harmonizing rules on fair access to and use of data. The Data Act will allow users of connected devices to gain access to data generated by them, which is often exclusively accessed by manufacturers. The proposed regulation also includes means for public sector bodies to access and use data held by the private sector that is necessary for exceptional circumstances and emergencies, such as in the case of natural disasters. Additionally, it will allow European consumers to switch between different providers of cloud data-processing services and puts measures in place against unlawful data transfer. The legislative process for the Data Act is underway.
The Digital Services Act and Digital Markets Act
In December 2020, the European Commission proposed new legislation to improve digital governance in the European Union; the Digital Services Act (DSA) and the Digital Markets Act (DMA). The aim of the legislation is to “create a safer digital space where the fundamental rights of users are protected and to establish a level playing field for businesses”. Digital services include a large range of online services, such as social networks and online travel and accommodation platforms. The DSA introduces stronger mechanisms for the removal of illegal content and for the protection of users’ fundamental rights. The DSA also introduces stronger public oversight of very large online platforms, bans on certain types of targeted adverts and transparency measures for online platforms. The DSA was published in the official journal of the European Union on 27 October 2022 and will enter into force on 16 November 2022. It will become applicable in February 2024.
The DMA will allow the European Union to regulate digital ‘gatekeeping’ of the EU market. A digital gatekeeper is a large online platform who has a significant impact on the EU market and who links its user base to a large number of businesses. The DMA will prevent digital gatekeepers from treating their own products and services more favorably than similar products and services offered by third parties on the gatekeeper’s platform. The purpose of this is to allow consumers greater choice and flexibility with online products and services, such as browsers and apps. The DMA entered into force on 1 November 2022 and will become applicable six months later.
Virtual Worlds / Metaverse
In September 2022, President of the European Commission Ursula von der Leyen affirmed the European Union’s commitment to the digital transformation and committed to look at new digital opportunities and trends, such as the metaverse.
The metaverse is an “immersive and constant virtual 3D world where people interact by means of an avatar to carry out a range of activities”. Some technology companies, particularly Meta, are already designing products and services for the metaverse, although from a policy perspective it is not yet clear what the societal and economic impacts of the metaverse will be. Nick Clegg, President of Global Affairs at Meta, described the metaverse as a ‘the next generation of the internet’, that ‘could be a positive force for inclusion and equity’. In September 2022, the European Commissioner for the Internal Market, Thierry Breton, announced the launch of the Virtual and Augmented Reality Industrial Coalition. The coalition brings together stakeholders from key metaverse technologies and forms parts of the European Commission’s efforts to roll out the ‘European ambition’ for the metaverse. It is expected that the European Commission will present a proposal on the metaverse next year.
The European Skills Agenda is a five-year plan to increase the digital skills of people and businesses. The agenda outlines key actions, including ensuring that people have the right skills for jobs, tools to support people in lifelong digital learning and a framework to increase investments in digital skills. The agenda sets objectives to be achieved by 2025 and is part of the European Union’s post Covid-19 recovery plan, NextGenerationEU.
The Digital Education Action Plan (2021-2027) proposes greater cooperation at European level on the development of digital education and includes measures to enhance digital skills needed for the digital transformation. The Digital Skills and Jobs Coalition brings together Member States, businesses and organisations to tackle the digital skills gap through initiatives such as the European Digital Skills Awards and the Digital Skills and Jobs Platform.
The effects of the EU digital policy often reach beyond EU borders and influence global standards as international companies wishing to operate in Europe must follow EU rules. Further developments on these and related issues are expected in the year ahead. According to European Commission President Ursula von der Leyen the digital transition has “taken on additional importance as we have grappled with pandemics, lockdowns and now a war on our border”.