Reforming Intermediary Liability in the Platform Economy: A European Digital Single Market Strategy

In my recent paper, ‘Reforming Intermediary Liability in the Platform Economy: A European Digital Single Market Strategy’, I discuss a package of online intermediary liability reforms under consideration in the EU as part of the Digital Single Market Strategy.

Since the enactment of the first safe harbours and liability exemptions for online intermediaries,[1] market conditions have radically changed. Originally, intermediary liability exemptions were introduced to promote an emerging Internet market, but do safe harbours for online intermediaries still serve innovation? Should they be limited or expanded? These critical questions—often tainted by protectionist concerns—define the present intermediary liability conundrum. Apparently, safe harbours still hold, although secondary liability is on the rise.

In its Digital Single Market Strategy, the European Commission plans to introduce sectorial legislation that would de facto erode liability exemptions for online intermediaries, especially platforms. Under the assumption of closing a ‘value gap’ between rightholders and online platforms allegedly exploiting protected content, the proposal aims to implement filtering obligations for intermediaries and introduce neighbouring rights for online uses of press publications. Meanwhile, an upcoming revision of the Audio-visual Media Services Directive would ask platforms to put in place measures to protect minors from harmful content and to protect everyone from incitement to hatred. Finally, the EU Digital Single Market Strategy endorses voluntary measures as a privileged tool to curb illicit and infringing activities online.

The upcoming European Digital Single Market reform endorses a reaction to the platform economy that might be at least short-sighted and possibly the harbinger of dystopian scenarios. First, the Commission’s reductionist approach towards platform and sharing economies, digitization, and the Internet at large, might prove a bad policy approach. A narrative emphasizing the ‘value gap’—rather than the ‘added value’—of the platform economy seems counter-intuitive and disconnected from empirical evidence. In this respect, this reform package is apparently based solely on government and content industry assumptions, rather than independent empirical evidence. In contrast, there is plenty of evidence that might show positive externalities for creativity thanks to the Internet, digitization, and platforms that were never considered. Overlooking this evidence—or at least moving forward without an impact statement considering all evidence and possible narratives—might result in a reform that will prove obsolete before being implemented, and possibly detrimental for the Digital Single Market, rather than beneficial.

In addition, the present reform proposal might threaten systemic consistency. Apparently, the reformers would like to substantially intervene on intermediary liability principles through a so-called ‘sectorial approach,’ rather than through amending the eCommerce Directive where those principles are enshrined. This approach might create unavoidable conflicts between norms. Intermediary liability reform should happen first and foremost in the context of the eCommerce Directive, rather than through copyright and audio-visual reform—or the promotion of voluntary self-regulatory actions. This policy strategy—which de facto would turn the long standing European horizontal online intermediary liability approach into a vertical approach—might be easily exposed as a sloppy attempt to circumvent the lack of consensus in amending the present intermediary liability regimes—as emerged in multiple EU consultations.

Finally, the proposed EU reform deploys a strategy that would apparently turn online intermediaries into Internet police. Since the inception of the Internet, governments—and rights holders as far as IP enforcement online is concerned—have attempted to enlist intermediaries to sanitize the Internet from allegedly infringing and illicit materials. Proactive monitoring—and any ‘notice and stay-down’ regimes—will be a step in that direction. Meanwhile, the endorsement—as part of the EU Digital Single Market Strategy—of voluntary measures as a privileged tool to curb illicit and infringing activities online makes intermediaries prone to serve governmental purposes under murky, privately-enforced standards, rather than transparent legal obligations duly enforced by delegated agencies or the judiciary. In this respect, my paper contextualizes the recent EU reform proposal within a policy discourse shifting from intermediary liability to intermediary responsibility. Apparently, the European Commission aligns its strategy for online platforms to a globalized, ongoing move towards privatization of online enforcement through algorithmic tools. This process might be pushing an amorphous notion of responsibility that incentivizes intermediaries’ self-intervention to police allegedly infringing activities in the Internet. Due process and fundamental guarantees get mauled by algorithmic enforcement, silencing speech according to the mainstream ethical discourse.

Giancarlo Frosio is a Senior Researcher and Lecturer at the Center for International Intellectual Property Studies (‘CEIPI’) at Strasbourg University and a Non-resident Fellow at Stanford CIS.