Google and Meta Facing New EU Regulations To Curb Illegal Content

European Union countries and EU lawmakers have agreed upon a stringent regulation to curtail illegal content on online platforms. 

The bloc agreed on the broad terms of the Digital Services Act, or DSA, which will force tech companies to take greater responsibility for content optimization on their platforms.

With the new regulations in place, platforms like Alphabet Inc's GOOGL Google, Meta Platforms Inc's FB Facebook, and other large online firms will have to initiate strategies to more effectively tackle illegal content. 

According to the EU regulations, the new obligations include removing illegal content more quickly, explaining to users how their algorithms work, and taking stricter action on the spread of misinformation.

The companies face fines of up to 6% of their global turnover for violating the rules, while repeated breaches could see them banned from doing business in the EU.

“The DSA will upgrade the ground rules for all online services in the EU,” said European Commission President Ursula von der Leyen in a statement. “It gives practical effect to the principle that what is illegal offline, should be illegal online. The greater the size, the greater the responsibilities of online platforms.”

DSA is the second prong of EU antitrust chief Margrethe Vestager's strategy to rein in Alphabet unit Google, Meta, and other U.S. tech giants.

In March, Vestager won the backing of the 27-country bloc and lawmakers for landmark rules called the Digital Markets Act (DMA) that could force Google, Amazon.com, Inc AMZN, Apple Inc AAPL, Facebook, and Microsoft Corporation MSFT to change their core business practices in Europe.

"Google, Meta, and other large online platforms will have to act to better protect their users. Europe has made clear that they cannot act as independent digital islands," she said in a statement.