4 ms·

It feels like with fixed value fines most businesses just consider fines to be a cost of doing business but damn "10% of global revenue" is insanely dangerous.

xvector 2y ago
10% of global revenue is practically unenforceable and would result in major tech companies simply ignoring the fine and pulling out of the EU. "Forcing" companies to pull out in this manner would instantly ignite a trade war between the US and the EU. This is a no-win situation for the EU - if WhatsApp is shut down in the EU, for instance, it will cause massive problems, loss of life and money, etc. Whatever new solution arrives on the scene will struggle to turn a profit and probably be even less compliant with regulations for many years due to the sheer amount of regulation that has slowly accumulated.
- EMIRELADERO 2y ago
  So what do you think the solution is then? If the fines are small, people complain that they have no teeth and that corporations just see them as a cost of doing business. If the fines do actually have teeth, we have your comment here. What would you consider acceptable?
  - xvector 2y ago
    "Acceptable" is debatable. Is the company genuinely trying to fix the issue? Can they demonstrate it (provide PRs, resourcing information, updates, etc?) The real solution is not over-regulating the internet. This is how we end up with the comparatively barren tech landscape of the EU, or the trend towards authoritarianism in Brazil, where a massive platform was banned simply because some small and questionable rulings were ignored. The innovation aspect really bothers me. As a SWE you definitely feel the development burden of so much regulation, it is huge, and that's with the might of a large company and all that brings to support you. I can't imagine startups will ever even attempt to meet these regulations. My own experience dealing with regulation in big tech makes me believe this is one of the chief reasons the EU has experienced technological stagnation. Maybe good in the short term, very bad for humanity in the long term.
    - tgsovlerkhgsel 2y ago
      > I can't imagine startups will ever even attempt to meet these regulations. Most of DMA targets only "gatekeepers" (i.e. big tech), not small startups.
- tgsovlerkhgsel 2y ago
  > if WhatsApp is shut down in the EU, for instance, it will cause massive problems, loss of life and money, etc. Please explain how WhatsApp shutting down in the EU would cause "massive problems, loss of life and money" rather than e.g. Signal having two weeks of instability due to 200M new users and that being the end of it?
  - xvector 2y ago
    Countless people rely on WhatsApp. Historically, when we have seen WhatsApp go down even for a short amount of time we have seen massive disruption and some loss of life. Emergency services in some locations rely on WhatsApp, most businesses use WhatsApp to communicate with customers. You'd have to re-build your whole network on another app. Signal may be that app or the ecosystem might simply fracture.
ceejayoz 2y ago
“Up to” gives a nice bludgeon to hit the repeat or clearly malicious offenders. It’s a response to the “insanely dangerous” actions of the industry.
yndoendo 2y ago
The USA would be better off moving away from fixed cost fines and to dynamically calculated fines based on individual and organizational wealth. This way the law binds the poor and the wealthy. It would also erode the statement "Fines are the cost of doing business".
- cal5k 2y ago
  Sure - if you want zero innovation. If you're a large enough entity operating in multiple jurisdictions around the world, you're exposed to such a byzantine labyrinth of laws and regulations that it's impossible not to be in violation of some rule or law, somewhere, at all times. Regulators know this. They use discretion to decide when and how to enforce these rules. Some are seldom enforced, others enforced with reckless abandon depending on the administrator, market conditions, political winds, etc. Every regulated financial institution, for example, and I mean every single one, will be fined for something if it is big enough and has been around long enough. Basing fines on worldwide revenue is a ridiculous way to ensure absolutely no risk-taking happens, because innovation happens at the margin. Tomorrow's massive industry is today's grey area.
  - malfist 2y ago
    I can't believe that baising fines on the wealth of the criminal could possibly lead to zero innovation. There's a difference between risk taking in doing something new and innovation and risk taking of riding the line of legal/illegal. I for one, would much prefer an environment where businesses were a little more afraid of breaking the law to exploit people/environments/other businesses/etc.
  - ceejayoz 2y ago
    The industry has spent decades moving revenue worldwide via complex financial engineering to avoid taxation. This is the end result of that innovation.
tgsovlerkhgsel 2y ago
Unfortunately, it's very unequal: A firm with a 5% profit margin would be hit way harder by "10% of global revenue" than a firm with 50% profit margin.
- ceejayoz 2y ago
  That’s likely considered when assessing the fines.
  - tgsovlerkhgsel 2y ago
    I'd like to see "10% of revenue or 100% of profit, whichever is greater" (scaled accordingly, i.e. 20%/200% for repeat offenses).

xvector 2y ago

10% of global revenue is practically unenforceable and would result in major tech companies simply ignoring the fine and pulling out of the EU. "Forcing" companies to pull out in this manner would instantly ignite a trade war between the US and the EU. This is a no-win situation for the EU - if WhatsApp is shut down in the EU, for instance, it will cause massive problems, loss of life and money, etc. Whatever new solution arrives on the scene will struggle to turn a profit and probably be even less compliant with regulations for many years due to the sheer amount of regulation that has slowly accumulated.

EMIRELADERO 2y ago
So what do you think the solution is then? If the fines are small, people complain that they have no teeth and that corporations just see them as a cost of doing business. If the fines do actually have teeth, we have your comment here. What would you consider acceptable?
- xvector 2y ago
  "Acceptable" is debatable. Is the company genuinely trying to fix the issue? Can they demonstrate it (provide PRs, resourcing information, updates, etc?) The real solution is not over-regulating the internet. This is how we end up with the comparatively barren tech landscape of the EU, or the trend towards authoritarianism in Brazil, where a massive platform was banned simply because some small and questionable rulings were ignored. The innovation aspect really bothers me. As a SWE you definitely feel the development burden of so much regulation, it is huge, and that's with the might of a large company and all that brings to support you. I can't imagine startups will ever even attempt to meet these regulations. My own experience dealing with regulation in big tech makes me believe this is one of the chief reasons the EU has experienced technological stagnation. Maybe good in the short term, very bad for humanity in the long term.
  - tgsovlerkhgsel 2y ago
    > I can't imagine startups will ever even attempt to meet these regulations. Most of DMA targets only "gatekeepers" (i.e. big tech), not small startups.
tgsovlerkhgsel 2y ago
> if WhatsApp is shut down in the EU, for instance, it will cause massive problems, loss of life and money, etc. Please explain how WhatsApp shutting down in the EU would cause "massive problems, loss of life and money" rather than e.g. Signal having two weeks of instability due to 200M new users and that being the end of it?
- xvector 2y ago
  Countless people rely on WhatsApp. Historically, when we have seen WhatsApp go down even for a short amount of time we have seen massive disruption and some loss of life. Emergency services in some locations rely on WhatsApp, most businesses use WhatsApp to communicate with customers. You'd have to re-build your whole network on another app. Signal may be that app or the ecosystem might simply fracture.

ceejayoz 2y ago

“Up to” gives a nice bludgeon to hit the repeat or clearly malicious offenders. It’s a response to the “insanely dangerous” actions of the industry.

yndoendo 2y ago

The USA would be better off moving away from fixed cost fines and to dynamically calculated fines based on individual and organizational wealth. This way the law binds the poor and the wealthy. It would also erode the statement "Fines are the cost of doing business".

cal5k 2y ago
Sure - if you want zero innovation. If you're a large enough entity operating in multiple jurisdictions around the world, you're exposed to such a byzantine labyrinth of laws and regulations that it's impossible not to be in violation of some rule or law, somewhere, at all times. Regulators know this. They use discretion to decide when and how to enforce these rules. Some are seldom enforced, others enforced with reckless abandon depending on the administrator, market conditions, political winds, etc. Every regulated financial institution, for example, and I mean every single one, will be fined for something if it is big enough and has been around long enough. Basing fines on worldwide revenue is a ridiculous way to ensure absolutely no risk-taking happens, because innovation happens at the margin. Tomorrow's massive industry is today's grey area.
- malfist 2y ago
  I can't believe that baising fines on the wealth of the criminal could possibly lead to zero innovation. There's a difference between risk taking in doing something new and innovation and risk taking of riding the line of legal/illegal. I for one, would much prefer an environment where businesses were a little more afraid of breaking the law to exploit people/environments/other businesses/etc.
- ceejayoz 2y ago
  The industry has spent decades moving revenue worldwide via complex financial engineering to avoid taxation. This is the end result of that innovation.

tgsovlerkhgsel 2y ago

Unfortunately, it's very unequal: A firm with a 5% profit margin would be hit way harder by "10% of global revenue" than a firm with 50% profit margin.

ceejayoz 2y ago
That’s likely considered when assessing the fines.
- tgsovlerkhgsel 2y ago
  I'd like to see "10% of revenue or 100% of profit, whichever is greater" (scaled accordingly, i.e. 20%/200% for repeat offenses).