Digital will be central to the future of Europe

  • techUK techUK
    Thursday13Sep 2018

    European Commission President Juncker’s final State of the Union speech highlights immediate and long-term issues facing Europe and digital will be front and centre of...

Wednesday was a busy day in Strasbourg for the European Parliament. With key votes during plenary on Hungary and Copyright. These two controversial topics (you can see techUK’s view on the disappointing result on Copyright here) almost, but not quite, took attention away from what is usually considered a highlight in the EU’s calendar. European Commission President Juncker’s State of the Union speech.


The speech was partly a run down of the Commission’s achievements over the last five years as President Juncker proudly declared that the European Union was now a global force to be reckoned with. However, there was also plenty of acknowledgement that more needed to be done to tackle the significant challenges facing the Union and to secure a bright future for Europe.


This wasn’t quite a farewell just yet though, with President Juncker setting out a number of policies the Commission would pursue ahead of next year’s election. Despite reports to the contrary this included more than the monumental decision to abolish the semi-annual changing of the clocks allowing Member States to set their own times.


Digital is a clear theme for the Commission’s final year, with proposals around dissemination of terrorist content online, the need to take action on taxation, efforts to protect elections from hacking and interference and improved cybersecurity defences. The tech industry shouldn’t expect a ‘lame duck’ period from this Commission it seems.


Given the focus on digital and with this being President Juncker’s last State of the Union Speech before next year’s European elections, it is worth considering what the future might hold for Digital and Europe.


Immediate issues


Digital has been a clear focus of the Juncker Commission, with determined actors such as Vice-President Andrus Ansip keen to make progress on developing the Digital Single Market. How successful has that been? It would be fair to say its been mixed, with some success stories (see Free Flow of non-Personal Data) and some failures (see Copyright). As the Digital Single Market initiative has been developing, the digital sector has been on the receiving end of what has felt like an endless amount of legislation over the last four years.


It will take time for the various new pieces of legislation to bed-in and for their effectiveness to be evaluated. Enforcement of the new rules will likely be a key focus for the next Commission, who will need to allow time before producing another tranche of proposals for the European digital sector.


That said there are some big questions that will be asked of the sector relatively soon. We can expect the conversation on platform liability to continue. Following yesterday’s vote on Copyright a precedent may have been set that allows for the piece-meal transformation of the fundamental underpinnings of the free and open internet, and platforms’ role in moderating content uploaded by users. The new proposals on the dissemination of terrorist content online are evidence of this, which if passed will require platforms to remove flagged content within an hour. The objective of reducing the amount of terrorist content found online is of course right. However, legislators need to be incredibly careful about the tools used to act in this space. Definitions must be clear, scope targeted, and fundamental freedoms of users protected. At this stage it seems the proposals fail these key tests.


It is widely expected that the next Commission is likely to look again at the e-Commerce directive. This will be hugely significant and important in shaping the future direction of the digital economy in Europe and will touch on everything from limitations to liability, hosting provisions and caching.


Longer-term issues


President Juncker’s last State of Union Speech also addressed some of the fundamental challenges facing the European Union, which will not be resolved over night (or by the end of Juncker’s term in office).


With the United Kingdom leaving the European Union (which in itself is one of those fundamental challenges), one might think these issues matter less to the UK. That is wrong. As President Juncker said yesterday the UK will never be an ordinary third country. Our histories are shared histories, and, in all likeliness, our futures will be shared futures. The UK and EU will always be key strategic and economic partners and the European market will remain vitally important to UK businesses. The exact shape of the UK and EU’s future relationship remains to be seen. techUK has been clear that a close partnership is in the shared interest of UK and EU businesses and consumers.


The biggest challenge the EU is likely to face in the coming decade is migration, with increasing concerns coming from Member States about their ability to control borders. It is likely that technology will be sought after to provide a solution to these concerns. The industry will want to approach this carefully and avoid being caught up in the incredibly sensitive politics surrounding these concerns. The trend of rising nationalism, pointed at in Juncker’s speech, fuels some of these concerns and should be carefully monitored.


The EU has been trying to tackle the issue of taxation in an increasingly global economy, with limited success. Expect this one to continue into the longer term as countries continually look to find an international solution to concerns around where companies pay tax. Much of this debate is targeted at tech companies, who have been clear they support an international-level agreement. Progress has admittedly been slow so will the EU put up with many more delays? Juncker suggested yesterday that Member States shouldn’t be allowed to block EU tax policy so reluctant countries might not be able to delay much longer.


A large part of Juncker’s speech focused on Europe’s place in the world. Trade discussions will dominate the global conversation in the coming years which, matched with increasing nationalism, could take a different path to that trod in years gone by. The recent EU-Japan trade agreement and accompanying adequacy agreement is a clear indicator that the EU wants to demonstrate it is open to trade. With an increasing proportion of cross-border transactions taking place online, digital trade will be crucial in the coming years. Provisions for digital trade have been somewhat limited – if trade deals want to remain relevant that will have to change.


President Juncker’s final State of the Union speech certainly flagged a number of areas where work is needed to ensure unity and progress in Europe. Some will require immediate action and attention, some will require longer-term, more thoughtful, intervention. What is clear is that digital will play a key role Europe’s future.


For more information about techUK’s activities in Europe please contact Jeremy Lilley.

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