HIKMA SUMMIT
OF INTERNATIONAL RELATIONS

This article will explore the Brussels effect on the global regulation of digital technologies. I argue that this is the most relevant example of EU regulatory influence worldwide. To support my argument, I will first address some common objections about the contemporary relevance of the Brussels effect; I will then explore how Tech regulation is influencing the relations between Brussels and Washington; and finally, I will dig into EU’s most influent pieces of legislation in the Tech sector.

Is the Brussels effect dying?

When discussing the importance of the Brussels effect, a frequent argument suggests that EU regulations are progressively losing their relevance. Three elements are brought as a demonstration of this: 1. The EU has very few Tech giants, 2. The size of the EU’s economy is relatively shrinking, 3. EU laws in the Tech sector are too restrictive and protectionist. A misunderstanding of the true origins of the Brussels effect lies behind these objections. EU regulations are not globally influent because of the EU’s economic size per sè, but rather for two additional factors. The first one is the dimension of the EU’s market, especially in the service industry. Regardless of the number of big Tech corporations in Europe, it remains, in the words of the already mentioned Anu Bradford, an “unavoidable trading destination”. The important factors are that “[EU] now attracts about 30 percent of global service imports”, and “Meta and Apple obtain 22 percent and 24 percent of their revenue from Europe – second only to the US”. The second important factor is the quality of EU legislation in the Tech sector. While regulation in other fields (e.g. environmental problems) is oftentimes seen by third countries as designed to disadvantage them and favor European businesses, EU laws in the Tech sector “are traditionally considered to be of high quality and tackle widely accepted problems […] based on well-accepted values like competition and fundamental rights”. These elements suggest that the Brussels effect is here to stay.

The “Spider-men meme” between Washington and Brussels

Drawing from a social media pop culture reference, Tech reporter Mark Scott suggested that Washington and Brussels might be becoming the “Spider-men meme” of Tech regulation. While this phrasing can seem ironic, it catches a very relevant process in the sector: the two actors are becoming increasingly aligned on whether and how to regulate the functioning of Big Tech – and this alignment is increasingly shifting towards EU-style regulations. This shift was not obvious at all. Indeed, just a few years ago the U.S. had a deeply different stance on Tech regulations, which Anu Bradford labels “techno-libertarianism”. As noted by Mark Scott, however, “Gone are the days when U.S. officials would repeat industry talking points about no need for regulation and oversight. […] the discussion has shifted to what those rules should look like. And with that has come an EU-centric view of transparency, accountability and responsibility that seeps out of Washington’s renewed vision of digital policymaking. It’s hard not to see Brussels’ hand in some of that”.

To be sure, the influence is not unidirectionally going from Brussels to Washington. EU (together with the single member states) are also “embracing their inner Washington”, especially when it comes to Tech relations with China. It was already evident with the exclusion of Huawei from European 5G networks, it became clearer with the EU Commission’s ban of TikTok from officials’ work phones, and it will likely become even more important with the U.S. sanctions on Tech exports to China. When it comes to regulation, however, Brussels’ influence on the White House seems to be even more pervasive, constituting a fully-fledged Brussels effect.

The most influential regulations

Four pieces of legislation are the most relevant examples of EU regulations’ global influence. The most evident one is probably the General Data Protection Regulation (GDPR). As the name suggests, this law deals with the privacy and security of EU citizens' personal data: indeed, it is the toughest regulation in the world dealing with this matter. The global reach of the measure is due to the fact that “it imposes obligations onto organizations anywhere, so long as they target or collect data related to people in the EU”. Some of the provisions of this law are very taxing, and nonetheless, they are followed and stuck to throughout the world. The reason for this is evident: no organization can afford to choose to give up the EU market entirely, therefore the choice between “take it or leave it” is an obvious one. GDPR has impacted the world to the extent that some have referred to it as ‘imperialist’. One of the most unexpected countries to be influenced by it is China, whose privacy and data protection rules have been noticed to be “even more onerous than those of the GDPR”. Chinese data protection rules, however, clearly do not apply to the use of data by the authorities.

The second regulation to consider is the Digital Market Act (DMA). This piece of legislation identifies some “gatekeepers” of the digital world (mainly based on their market share – some examples are Meta, Google, Apple, etc.) and aims to ensure that their behaviour in the digital market remains fair and competitive. Despite some concerns of hindering innovation, the DMA has been influential in the design of similar measures in Brazil, the UK, and other countries: it is clear that the unproportionate power of “Big Tech” companies in the management of the digital space is widely recognized as a problem around the world.

The third relevant example of the Tech Brussels effect is the Digital Service Act (DSA), which deals with content moderation on social media platforms and contrast to hate speech and disinformation. In this case, the Brussels effect is hindered by an evident friction between two opposite ways of dealing with the matter: “While the EU and its constituent nations generally prioritize protecting against dignitary, reputational, and societal harms more highly than absolute freedom of expression, and they generally hold platforms accountable for their role in facilitating harmful content, the U.S. takes the opposite approach. […] Section 230(c) [of the Communications Decency Act], which is the main piece of legislation applicable to general platform liability in the U.S., immunizes platforms from many forms of liability for hosting third-party content”. The differences ultimately come down to the traditional distinction between protecting free speech at all costs and prioritizing the protection of some values by moderating what can be said and what cannot. While the debate is still ongoing globally, there is an increasing awareness of the need to apply at least some form of content moderation to social media platforms. In this sense, the DSA is probably the most important piece of the debate.

Finally, the fourth regulation to consider is the very recent AI Act. In this case, the Brussels effect is even more prominent, in that the EU is the first actor to organically and systematically regulate the matter. Once again, the EU presents itself as both the main model for AI regulation and an unavoidable market for AI products. This represents the perfect mix to expect EU rules on AI to have a global reach, especially for those products that are labelled as “High risk” in the AI Act scale.

This list demonstrates that the EU’s regulatory activism in the digital space is an increasingly inspiring model for other countries that face the same problems. The implications of these rules on the shape of the digital space are still far from being clear. What is clear, however, is that this shape will mostly be crafted in Brussels.