EU digital framework is a ‘seismic shift’ for businesses

A raft of incoming digital and online regulation will create a seismic shift for businesses, head of the William Fry technology group Leo Moore has said.

Sixteen new pieces of incoming EU legislation will affect businesses, primarily in the technology sector, by introducing new regulations in categories such as artificial intelligence, cyber, content, data, and platforms, he told Gazette.ie.

“There's a significant shift for businesses. For some more than others, it's quite challenging,” he said.

“There are 16 new laws coming in, and businesses must work out which laws apply to them. Not everything will apply to everybody.”

Raft of laws

The raft of laws would alter the way in which digital and online responsibility and risk was approached, he explained.

"They will require predetermined risk analysis before product launch, with evaluation of risk factors and protective measures.

“The NIS2 requires legal measures to boost the overall level of cyber-security to keep up with increased digitisation and the cyber-threat landscape. The Digital Services Act, another part of a much broader package that comprises the EU digital strategy, aims to create a safer digital space. There's a lot coming down the tracks", Leo Moore said.

However, he warned that the changes to the digital regulatory environment might feel “overwhelming” for in-house counsel and compliance teams.

In response, William Fry has built a tool that will help in-house counsel and businesses address how they are going to get on top of this legislation.

“This tool will allow businesses to quickly determine the specific regulations that apply to them, in a cost-efficient way. By using technology, we can quickly assess which of the new rules apply to a business,” he explained.

“With a clear understanding of what laws apply, we can work with the businesses to create a roadmap for implementation and ongoing support,” he said.

Innovation

Moore believes that the EU is seeking a balance between innovation, growth and competitiveness, and appropriate regulation, in the digital era.

“In the long run, people want trustworthy online products and services. It's arguable that, in some parts, EU regulations might slow up innovation, but generally for good reasons – it will create a more level playing field,” he said.

“From a wider societal perspective, this has several significant benefits. The EU digital-reform package will likely drive a global approach, much like the GDPR,” he added.

The GDPR had been adopted throughout the world as a model of data-protection regulation, he pointed out.

“The GDPR has taken the lead in terms of the protection of people's human rights and their privacy rights,” he said.

Bulky legislation

“It is quite a bulky, heavy piece of legislation, but what we're finding is that multiple other jurisdictions around the world have copied that model in ways, over time."

“I suspect there will be similar impacts for the wider global digital environment from the new EU digital reform package,” he said.

The EU is driving a direction of travel for digital technologies, and those who wish to trade with the bloc must follow suit and must comply with EU laws if they wish to operate in the EU.

To that end, while Britain was diverging in some ways from the EU, it was also very much aligned in many ways because of trade imperatives, Moore added.

Digital communication and information-exchange platforms had not, thus far, been subject to the same rigorous standards as ‘traditional’ media, he continued. 

However, the upcoming regulation of online media was a form of ‘catch-up’, he said.

The Digital Services Act would make those platforms more accountable. It introduces more clarity on concomitant responsibilities in relation to material and content provided by users of the platforms: “This actually goes to the heart of the DSA,” Moore said.

“Platforms can, in certain instances, be held liable for content published online, and new rules are being put in place under the DSA on notice and action mechanisms."

“One of the provisions of the DSA requires certain prompt steps to be taken by platform providers if information on the platform is illegal content,” he explained.

Overlapping elements

In Ireland, there is an additional element of online-safety provisions in the Online Safety Media Regulation Act 2022, which has a number of different and overlapping elements.

Under that legislation, an online-safety code to address harmful content is being drafted, with publication expected shortly.

“Ireland has a dual approach to dealing with some of the horrors online, in terms of harmful and illegal content,” Leo Moore said.