Priority 2 - A Europe fit for the Digital Age

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Data Protection

Better Access to Online Goods for Consumers and Businesses

The Right Environment for Digital Networks and Services

Economy and Society

European Commission Work Programme 2022

Cyber Resilience

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Legislative, incl. impact assessment, Q3 2022.

Semi-Conductors

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Proposal: On 8th of February 2022, the Commission presented a Proposal for a Regulation establishing a framework for actions to strengthen the European semiconductor ecosystem (press release).

Problem: Digitalisation is moving into all areas of life. This increases the need for semiconductors in particular, whose demand is currently greater than the market, however, with supply bottlenecks additionally lead to a shortage of availability. The shortage of semiconductors is having a serious impact on industrial companies worldwide. Many European sectors, including automotive, energy, communications and health, and strategic sectors such as defence, security and space are threatened by such supply shortages. At the same time, counterfeit chips are appearing on the market, threatening the security of electronic devices and systems. The semiconductor shortage has exposed structural weaknesses in the European value chain and Europe's dependence on third countries. Despite its strong global position in the production of materials and equipment, the Union is heavily dependent on third country suppliers for the design, manufacture, packaging, testing and assembly of chips.

Objective: The proposal aims to achieve the strategic objective of increasing the resilience of the European semiconductor ecosystem and its global market share. The proposal also aims to facilitate the early introduction of new chips by the European industry and increase its competitiveness. To achive this, the European chip industry needs to attract investment in innovative production facilities and have a skilled workforce, but also be able to design and manufacture state-of-the-art chips. The objectives of the Regulation are summarised in three pillars: 1. "Chips for Europe Initiative", 2. "Security of supply" and 3. "Monitoring and crisis response".

Subject matter: To implement the objectives, the "Chips for Europe" initiative will support large-scale technological capacity building and innovation, in particular in the form of an innovative virtual design platform that will foster collaboration between user communities and the development sites. The initiative will also develop pilot prototyping facilities and establish a network of competence centres to support stakeholders with sufficient expertise. A chip fund will be established to increase the availability of funds to support growth and investment along the entire semiconductor value chain.
To ensure security of supply, investments will be driven and improved production capacity in semiconductor manufacturing and advanced packaging, testing and assembly will be ensured through first-of-a-kind Integrated Production Facilities and Open EU Foundries. In addition, jointly developed standards and certifications will identify sector-specific requirements for trustworthy chips to ensure cybersecurity.
The creation of a coordination mechanism between the member states and the Commission is intended in particular to monitor the semiconductor value chain and to enable rapid responses to disruptions in the supply of semiconductors by means of a crisis-stage system.

Security and Defence

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Non-legislative, Q1 2022.

Innovative and Sustainable Space

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Legislative, incl. impact assessment, Article 189 TFEU, Q2 2022.

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Non-legislative, Q2 2022.

Digital in Education and Skills

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Non-legislative, Q3 2022.

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Non-legislative, Q3 2022.

Single Market

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Legislative, incl. impact assessment, Q1 2022.

Multimodal Digital Mobility

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Legislative, incl. impact assessment, Article 91 TFEU, Q4 2022.

European Commission Work Programme 2021

Europe’s Digital Decade

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On the 9th of March 2021, the European Commission published a Communication regarding the European Digital Decade (Press release).

Goals: With the "Digital Compass 2030", the Commission formulates four concrete objectives to achieve its digitization efforts:

A digitally skilled population with highly skilled digital professionals: In addition to the basic digital skills target set out in the European Pillar of Social Rights Action Plan, further develop the digital education system.
Secure and performant sustainable digital infrastructures
a) All European households shall be equipped with a gigabit network and all populated areas shall equipped with 5G networks
b) To drive the production of advanced and sustainable semiconductors in Europe, including processors
c) 10,000 carbon-neutral, high-security edge nodes shall be deployed across the EU by 2030, distributed to ensure low-latency (a few milliseconds) access to data services wherever businesses are located.
d) By 2025, Europe should have a first computer with quantum acceleration, paving the way for Europe to be at the forefront of quantum capabilities by 2030.
Digital transformation of businesses: By 2030, 75 per cent of European companies are expected to use cloud computing services, Big Data, and artificial intelligence. In addition, more than 90 per-cent of European SMEs should have achieved at least a basic level of digital intensity
Digitization of public services
a) By 2030, EU citizens should be able to view an electronic version of their medical records
b) Enable online provision of key public services to European citizens and businesses by 2030.
c) 80 per cent of EU citizens shall use a digital ID solution by 2030.


Implementation: To achieve the Digital Compass goals, the European Commission is pursuing the implementation of a governance structure with annual reporting and tracking. The Commission intends to propose the Digital Compass objectives in the form of a digital policy program to be adopted in an ordinary legislative procedure, focusing on implementation and ongoing commitment to the common digital objectives

Timeframe: The European Commission aims to present concrete objectives with its proposal for a digital policy program by the third quarter of 2021 and hopes to make decisive progress with the other institutions on a statement of digital principles by the end of 2021

Data Package

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Proposal: On the 23rd of February 2022, the Commission proposed a Regulation on harmonised rules on fair access to and use of data, also known as Data Act (press release).

Problem: The volume of data is constantly growing, from 33 zettabytes generated in 2018 to 175 zettabytes expected in 2025. It is an untapped potential but, 80 per cent of industrial data is never being used.

Objective: The aim of the Data Act is ensuring fairness in the allocation of value from data among actors in the data economy and to foster access to and use of data. Therefore, it addresses legal, economic and technical issues that lead to data being under-used in the past. The new rules shall make more data available for reuse and are expected to create 270 billion euros of additional GDP by 2028. The proposal’s specific objectives are (1) Facilitating access to and the use of data by consumers and businesses, while preserving incentives to invest in ways of generating value through data; (2) Providing for the use of data by public sector bodies and Union institutions, agencies or bodies of data held by enterprises in exceptional situations; (3) Facilitating switching between cloud and edge services; (4) Putting in place safeguards against unlawful data transfer without notification by cloud service providers; (5) Providing for the development of interoperability standards for data to be reused between sectors.

Subject matter: With the help of this Regulation (1) legal certainty shall increase in order to generate a more transparent and easier access to the data for consumer and businesses. Manufacturers and designers are to be transparent on what data will be accessible and how it can be accessed. Obligations to make data available shall be fair and non-discriminatory, and any compensation will have to be reasonable. Guarantees that contractual agreements on data access and use do not take advantage of imbalances in negotiating power between the contractual parties shall be ensured by an unfairness test, including a general provision defining unfairness of a data sharing-related contractual term complemented by a list of clauses. (2) In situations where public sector bodies have an exceptional need to use certain data (i.e. public emergencies), a framework shall make data available for public sectors bodies to use for free. To ensure that the right to request data is not abused, the requests for data would need to be proportionate, clearly indicate the purpose, and respect the interests of the enterprise making the data available. (3) Minimum regulatory requirements for providers of cloud, edge and other data processing services, shall enable customers to switch between services. Therefore, this proposal shall ensure a minimum level of functionality after switching to another provider. (4) In order to prevent unlawful data transfer, providers are to be obliged to take all reasonable technical, legal and organisational measures to prevent such access. (5) For an interoperability use of data, requirements shall promote a seamless multi-vendor cloud environment by allowing interoperability between operators of data spaces and data processing services.

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Legislative, incl. impact assessment, Article 114 TFEU, Q3 2021.

Digital levy

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Legislative, incl. impact assessment, Q2 2021.

A European approach to Artificial Intelligence

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Legislative, incl. impact assessment, Article 114 TFEU, originally scheduled for the Q4 2020.

Digital for Consumers

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Proposal: On the 23rd of September 2021, the European Commission published a Proposal for a Directive to harmonize the laws of the member states relating to the making available on the market of radio equipment (press release).

Problem: Consumers often have the problem that they do not have a suitable charger to land their electronic device. As a result, consumers spend an average of 2.4 billion euros on separate chargers that are not supplied with electronic devices. Consequently, disposed and unused charging devices are estimated to generate up to 11,000 tons of e-waste per year.

Objective: With this proposal for a Directive, the Commission aims to ensure standardization of charging interfaces for wired rechargeable cell phones and similar categories of radio equipment for all relevant devices. This should lead to greater consumer convenience and at the same time ensure a reduction of e-waste. Therefore, the sale of chargers and electronic devices will be unbundled. Thus, consumers will not be forced to purchase a new charger when buying a new electronic device.

Subject Matter: To harmonize charging ports and fast charging technology, the USB Type-C port is to become the standard port for all smartphones, tablets, cameras, headphones, portable speakers and portable video consoles. As soon as these require a voltage of more than 5 volts, a current of more than 3 amps or a power of more than 15 watts, they must support the USB Power Delivery (USB PD) charging protocol, as it is then a fast charge function. Therefore, for better consumer convenience, information about the charging power characteristics as well as the power supply of the chargers should be provided. A transitional period of 24 months after entry into force should make it easier for companies to implement the revised requirements. To review the Directive, the Commission is to submit a report to the European Parliament and the Council by two years after the Directive becomes applicable and report on the progress every five years thereafter.

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  A Trusted and Secure European e-ID

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Proposal: Proposal for a Regulation on a trusted and secure European e-ID (press release).

Aim: On the 3rd of June 2021, the European Commission proposed a Regulation to form a framework for a European digital identity wallet. It shall enable EU citizens to use personal identification data to identify themselves in online and offline services across Europe. In addition, it should give EU citizens the possibility to store credentials linked to their identity, make them available to trusted parties on request as well as to sign them by using a qualified electronic signature. This would apply to documents such as university transcripts, birth certificates, or even medical records. The European digital identity wallet is not a mandatory application for EU citizens; it is simply intended to facilitate identification in other EU countries and to guarantee access to a wide range of public and private services.

Legislative requirements: In order to establish a pan-European infrastructure, member states must provide and accept the proof of identity from each other and establish validation mechanisms based on common technical standards. Further requirements include that users ought to have full control over their wallet. The issuer is not allowed to collect information about the use of the wallet, nor is he/she allowed to combine personal identification data and other personal data stored in the wallet – something which could allow abusers to draw conclusions on the user’s behaviour.

Implementation: Within six months after the entry into force of the Regulation, the Commission is required to present technical and operational specifications for the establishment of the wallet. After 12 months, all member states should be able to issue wallets. After 24 months, the Commission is obliged to conduct an implementation review and present it to the Council and European Parliament in the form of an evaluation report.

Funding: The total funding required to implement the proposal over the period 2022-2027 is up to 30.825 million euro, including 8.825 million euro in administrative costs and up to 22 million euro in operational expenditure covered by the Digital Europe program.

Platform workers

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Proposal: On the 9th of December 2021, the Commission proposed a Directive on improving the working conditions in platform work. (press release)

Problem: The digital transition, accelerated by the COVID-19 pandemic, has increased the importance of digital labour platforms. This means, even though digital labour platforms open up many opportunities, it also introduces a new form of work organization which challenge existing rights and obligations related to labour law. According to one estimate, up to five and a half million people working through digital labour platforms could be at risk of employment status misclassification. Those people are most likely to experience poor working conditions and inadequate access to social protection. Moreover, digital labour platforms use algorithmic management systems. It creates efficiencies in the matching of supply and demand but has also a significant impact on working conditions in platform work. It is so far unregulated phenomenon in the platform economy that poses challenges to both workers and the self-employed working through digital labour platforms.

Objective: With the help of this Directive, the Commission aims to improve the working conditions and social rights of people working through platforms. This means (1) to ensure that people working through platforms have the correct employment status and gain social protection rights. Moreover, (2) ensuring fairness, transparency, and accountability in algorithmic management and (3) to enhance transparency, traceability, and awareness of developments in work as well as improving enforcement of the applicable rules for all people working through platforms.

Subject matter: In order to tackle the misclassification of employment status, the Commission aims to establish a framework including an appropriate procedure to ensure correct determination. This legal presumption shall apply in all legal and administrative proceedings. To ensure transparency and fairness in algorithmic management, the Commission introduces new material rights for people performing platform work. Moreover, establishing appropriate channels for discussing and requesting review of decisions made by an algorithmic management system shall ensure fairness, accountability, and safeguarding basic workers’ rights and health and safety at work of significant decisions taken or supported by automated systems. Furthermore, clarified obligations for digital labour platforms shall be implemented to enhance transparency and traceability of platform work. The Directive shall also improve labour and social protection authorities’ knowledge of which digital labour platforms are active in their member state.
Member states shall be obligated to transpose this Directive two years after it enters into force.

Foreign Subsidies (Follow-up to the White Paper on Foreign Subsidies)

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Proposal for a Regulation on foreign subsidies distorting the Internal Market (press release).

Objective: The European Commission aims to eliminate distortions in the single market caused by subsidies from third countries. Therefore, on the 5th of May 2021, the Commission proposed a Regulation, which includes multiple counter measures and new rules concerning companies that carry out an economic activity in the internal market.

What is considered as a foreign subsidy?
Foreign subsidies can take the form of capital injections, grants, loans, loan guarantees, tax incentives, compensation for operating loss, compensation for financial burdens imposed by public administration, debt forgiveness, conversion of debt into equity, or debt restructuring. In addition, the waiver of due revenues or the provision as well as the purchase of goods and services can also be considered a subsidy. The financial aid must be approved by the state from third countries.

What constitutes a market distortion?
A distortion of the internal market occurs as soon as the competitive position of the company concerned is improved with the help of the foreign subsidies. This occurs in most cases when the subsidies or unlimited guarantees are approved despite the poor economic situation of the company or when subsidies facilitate mergers as well as in the case of foreign subsidies inducing companies to submit unreasonably favorable bids.

Implementation: Since the Commission is supposed to conduct a review procedure ex officio, the Commission is allowed to request necessary information on its own initiative (ex ante approach) and thus conduct a preliminary examination. If there is sufficient evidence of distortion of the internal market within 90 days, the Commission adopts a decision to open an in-depth investigation. As part of the investigation, it shall determine what measures must be implemented to address the distortion. The company concerned can avert these by making a commitment to eliminating the distortion. The Commission shall have the right to impose remedies, having the power to impose interim measures if there is a serious risk of a significant and irreparable damage to competition in the internal market. If the Commission finds companies intentionally or negligently withholding or falsifying information, the Commission can impose fines and periodic penalty payments by decision. Furthermore, the draft Regulation pays particular attention to controlling the risk of distorting the market created by subsidies for mergers and public procurement procedures.

Funding: The total administrative expenditure for the implementation of the proposal over the period 2021-2027 is EUR 90.340 million euro, part of which will be funded by the Single Market Program.

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Industrial Strategy for Europe

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On the 5th of May 2021, the European Commission published a Communication updating the 2020 Industrial Strategy (press release). The 2020 Industrial Strategy was published in March 2020. One day before the WHO declared a global pandemic. Due to the changed economic and social situation, the strategy has now been revised and adapted to the current situation.

The Commission pursues the following objectives:
Strengthen the resilience of the common internal market
This includes an internal market emergency instrument for a better and faster response in times of crisis, as well as the strengthening of internal market governance instruments & procedures and more transparency and coordination in EU internal export and service restrictions. In addition, structures will be implemented to facilitate the movement of goods and services in the context of border restrictions, as well as faster product availability in times of crisis, an improved market surveillance procedure and stronger cooperation in public procurement.

Dealing with the EU's strategic dependencies
It is necessary to identify strategic dependencies and capacities and to implement measures that reduce and prevent strategic dependencies. This includes diversifying trade chains, strengthening alternative supply chains with closest allies, launching two industrial alliances (2nd Q 2021), the Processors and Semiconductor Technologies Alliance and the Industrial Data, Edge and Cloud Alliance and supporting the development of an Alliance on Space Launchers and a Zero Emissions Aviation Alliance. Moreover, strengthening measures against disruptions and vulnerabilities in small to medium enterprises (SMEs) supply chains (4th Q 2021), adopting a standardization strategy (3rd Q 2021) and developing guidance on identifying and addressing strategic dependencies through public procurement (1st Q 2022).

Accelerating the twin transition
To co-create transformation pathways, these need to be created in partnership with industry, public authorities, social partners and other stakeholders starting in the areas of mobility and tourism (2Q 2021). In addition, the Commission is pursuing measures to promote renewable power purchase agreements in a proposal for a revised Renewable Energy Directive (2.Q 2021). Furthermore, it considers a European approach to carbon offset contracts in a proposal for a revised ETS Directive (2.Q 2021) and to establish an energy and industrial geography laboratory to develop information on energy infrastructures (to be released in the 4th Q 2021).

Civil, Defence and Space Industries

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Non-legislative Act: On the 22nd of February 2021, the European Commission published a Communication in which it presented an action plan for synergies between the civil, defense and space industries (press release).

Problem: The space, defense and security sectors have not yet extensively exploited potential synergies. This is a result of regulatory obstacles, lack of a level playing field in international markets, lack of access to costly research infrastructure, and need for skilled labor.

Objective: With the help of the Action Plan ("Three-Point Belt Plan"), the goal is to (1) create synergies between EU programs and instruments to increase the efficiency of investments and the effectiveness of results. In addition, (2) support measures (spin-offs) of research and development to achieve economic and technological progress in the areas of defense and space. In this context, (3) the use of research results from civil industry in the defense sector is to be facilitated (spin-ins).

Subject matter: To strengthen synergies between the space, defense and security sectors, the Action Plan presents eleven concrete actions. These include early identification of needs, improving access to funding, support for start-ups, SMEs and RTOs, and technology roadmaps.

Design Requirements and Consumer Rights for Electronics

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Proposal: On the 23rd of September 2021, the European Commission published a Proposal for a Directive to harmonize the laws of the member states relating to the making available on the market of radio equipment (press release).

Problem: Consumers often have the problem that they do not have a suitable charger to land their electronic device. As a result, consumers spend an average of 2.4 billion euros on separate chargers that are not supplied with electronic devices. Consequently, disposed and unused charging devices are estimated to generate up to 11,000 tons of e-waste per year.

Objective: With this proposal for a Directive, the Commission aims to ensure standardization of charging interfaces for wired rechargeable cell phones and similar categories of radio equipment for all relevant devices. This should lead to greater consumer convenience and at the same time ensure a reduction of e-waste. Therefore, the sale of chargers and electronic devices will be unbundled. Thus, consumers will not be forced to purchase a new charger when buying a new electronic device.

Subject Matter: To harmonize charging ports and fast charging technology, the USB Type-C port is to become the standard port for all smartphones, tablets, cameras, headphones, portable speakers and portable video consoles. As soon as these require a voltage of more than 5 volts, a current of more than 3 amps or a power of more than 15 watts, they must support the USB Power Delivery (USB PD) charging protocol, as it is then a fast charge function. Therefore, for better consumer convenience, information about the charging power characteristics as well as the power supply of the chargers should be provided. A transitional period of 24 months after entry into force should make it easier for companies to implement the revised requirements. To review the Directive, the Commission is to submit a report to the European Parliament and the Council by two years after the Directive becomes applicable and report on the progress every five years thereafter.

European Commission Work Programme 2020

Europe fit for the Digital Age

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Non-legislative Act: On the 19th of February 2020 the European Commission published a Communication on Shaping Europe's digital future (press release).

Problem: The twin challenge of a green and digital transformation requires an immediate change of direction towards more sustainable solutions which are resource-efficient, circular and climate-neutral, so that every citizen, every employee, every business person has a fair chance, wherever they live, to reap the benefits of the increasingly digitised society. Furthermore, the arising of digital technologies leads to an increased uncertainty surrounding data protection as well as cybersecurity of critical infrastructure. Therefore, the Commission aspires to reflect on all levels of society as to how Europe can best meet, and continue to meet, these risks and challenges.

Objective: A European society is to be established, one that is powered by digital solutions and that enriches the lives of all by providing people the opportunity to develop personally, to choose freely and safely, to engage in society, regardless of their age, gender or professional background. Businesses shall acquire a framework that allows them to start up, scale up, pool and use data, to innovate and compete or cooperate on fair terms. Europe on the other hand needs to have a choice and pursue the digital transformation in its own way. Key objectives of the Communication include the development, deployment and uptake of technology that makes a real difference to people’s daily lives as well as of a strong and competitive economy that masters and shapes technology in a way that respects European values. A fair and competitive economy shall allow companies of all sizes and in any sector to compete on equal terms, and develop, market and use digital technologies, products and services at a scale that boosts their productivity and global competitiveness. Lastly, allowing an open, democratic and sustainable society is to create a trustworthy environment in which citizens are empowered in how they act and interact, and of the data they provide both online and offline.

Subject Matter: Initiating a White Paper on Artificial Intelligence shall help set out options for a legislative framework for trustworthy AI (adopted together with this Communication), with a follow-up on safety, liability, fundamental rights and data. A Digital Education Action Plan is to boost digital literacy and competences at all levels of education, while a reinforced Skills Agenda and a reinforced Youth Guarantee are to strengthen digital skills throughout society and put a strong focus on digital skills in early career transitions. Proposing an Industrial Strategy Package shall put forward a range of actions to facilitate the transformation towards clean, circular, digital and globally competitive EU industries, including SMEs and the reinforcement of single market rules. A European Data Strategy shall make Europe a global leader in the data-agile economy. In order to support digital transformation and competitiveness of the audiovisual and media sector as well as stimulate access to quality content and media pluralism, a media and audiovisual Action Plan is required. New and revised rules are to deepen the Internal Market for Digital Services, by increasing and harmonising the responsibilities of online platforms and information service providers and reinforce the oversight over platforms’ content policies in the EU. Finally, a Digital for Development Hub shall consolidate a whole-of-EU approach promoting EU values and mobilising EU member states and EU industry, Civil Society Organisations (CSOs), financial institutions, expertise and technologies in digitisation.

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Legislative, incl. impact assessment, Articles 103 and 114 TFEU, Q4 2020.

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Non-legislative, Q2 2020.

A European approach to Artificial Intelligence

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On the 19th of February 2020, the European Commission published its White Paper on "Artificial Intelligence- A European approach to excellence and trust" and the accompanying Report on the safety and liability framework. The stated goal of the Commission is to launch a broad consultation of member states, civil society, industry and academics on concrete proposals for a European approach to AI. On the one hand, these include policy means to boost investments in research and innovation, enhance the development of skills and support the uptake of AIby SMEs, and on the other hand proposals for key elements of a future regulatory framework

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On the 19th of February 2020, the European Commission presented a European Data Strategy which proposes to put in place an enabling legislative framework for the governance of common European data spaces in fourth quarter of 2020. Furthermore in 2021 a possible European Data Act could foster business-to-government data sharing for the public interest and support business-to-business data sharing, in particular addressing issues related to usage rights for co-generated data (such as IoT data in industrial settings), typically laid down in private contracts.

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Postponed to the Q1 2021.

Digital Services

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Legislative procedure completed: The European Parliament and EU Member States agreed on the Digital Services Act on 23 April 2022 (press release).

Proposal: On the 15th of December 2020 the European Commission published a Proposal for a Regulation on contestable and fair markets in the digital sector (Digital Markets Act) (press release).

Problem: Increasingly there are more large platforms that act as gateways or gatekeepers between business users and end users who enjoy an entrenched and durable position, often as a result of the creation of conglomerate ecosystems around their core platform services, which reinforces existing entry barriers. Having a major impact on as well as substantial control over the access to digital markets, many businesses become dependent on these gatekeepers, which leads, in certain cases, to unfair behaviour vis-à-vis these business users. Given that regulatory initiatives by member states cannot fully address these effects, action on EU level is crucial in order to prevent a fragmentation of the Internal Market.

Objective: The proposed Digital Markets Act aims to ensure that the conduct of large online platforms, acting as “gatekeepers” in digital markets, is guaranteed in a fair way, allowing the development of contestable and fair markets in the digital sector across the Union where gatekeepers are presented. Addressing gatekeeper’s unfair conduct in addition to enhancing the coherence and legal certainty shall help preserve the internal market. Interventions will allow the contestability of the digital sector, which in turn can have a significant positive and growing contribution in setting forward all of the potential benefits of a Digital Single Market, also resulting in lower prices and greater consumer choice, productivity gains and innovation. Efficiency gains from the Digital Single Market, will contribute to a 1.5 per cent increase in GDP per year until 2030 and create between 1 and 1.4 million jobs. Additionally, greater innovation potential amongst smaller businesses as well as improved quality of service shall increase consumer welfare. By establishing those aims, the regulation creates new opportunities for innovators and start-ups to compete in the online platform environment. As a result, consumers will have a wider variety of choices which providers to choose from and fairer prices. Nevertheless, the gatekeepers still have the opportunities to innovate, but in a fair way, without unfair practices towards the businesses and consumers.

Subject Matter: The communication between the Commission and the gatekeeper concerned may be required to ensure that measures considered or implemented by the gatekeepers better achieve its goals. By introducing the possibility for such a dialogue, the initiative can be expected to be more effective in addressing unfair practices hampering market contestability and competition. While the Regulation will be reviewed and evaluated every third year, the Commission shall continuously assess the effectiveness and efficiency of the measures. In particular, a review may be required when additional rules, including regarding enforcement, are determined necessary to ensure that digital markets across the EU are contestable and fair. Findings must be reported to the European Parliament, the Council and the European Economic and Social Committee.

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Legislative procedure completed: The European Parliament and EU member states agreed on the Digital Services Act on 23rd of April 2022 (press release).

Proposal: On the 15th of December 2020 the European Commission published a Proposal for a Regulation on a Single Market for Digital Services (Digital Services Act) and amending Directive 2000/31/EC (press release).

Problem: Ever since the e-Commerce Directive was adopted, new and innovative information society (digital) services have emerged, changing the daily lives of Union citizens and shaping and transforming how they communicate, connect, consume and do business. While a number of positive developments such as societal and economic transformations in the Union and across the world have been encouraged, new risks and challenges, both for society as a whole and individuals using such services, have become more apparent. Furthermore, with the emergence of the COVID-19 pandemic has highlighted the dependency of the economy and society on digital services as well as the risks stemming from the current framework for the functioning of digital services. Therefore, the Commission committed to update the horizontal rules that define the responsibilities and obligations of providers of digital services, and online platforms in particular, by reforming the existing EU e-commerce legal framework.

Objective: Appropriate supervision of digital services and cooperation between authorities at EU level is needed in order to ensure the proper functioning of the single market as well as establish trust, innovation and growth within. Thus, ensuring the best conditions for innovative cross-border digital services to develop in the EU across national territories and at the same time maintain a safe online environment for all EU citizens, goals which can only be served at European level. A strengthened European layer of supervision shall coordinate and complement national regulators. Additionally, to ensure the proper function of the internal market for intermediation services, innovation and competitiveness within the single market is to be fostered. Establishing an accountability framework for online platforms and setting out uniform rules for a safe online environment, where fundamental rights enshrined in the Charter are effectively protected, is further highlighted.

Subject Matter: This proposed Regulation contains clear rules on the provision of intermediary services, by establishing a framework for their responsibilities. This includes to address the risks faced by their users and to protect their rights, as well as rules on specific due diligence obligations. Another focus is on the enforcement of the regulation, including the cooperation between the competent authorities. For the cross-border application of the obligations under this Regulation, a consistency mechanism, a new advisory group coordinating the activities of national authorities and of the Commission as well as direct enforcement powers for the Commission and the set-up of an information system facilitating information flows between Digital Services Coordinators is needed. Furthermore, the proposed regulation comprehends additional obligations for very large online platforms to manage systemic risks. Within five years from the entry into force of the regulation, and then every five years thereafter, the Regulation will be reviewed periodically, including by the Commission, in order to evaluate the effectiveness and efficiency of the measures, in the context of the application of the measures.

Increasing Cybersecurity

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On the 16th of December 2020, the European Commission, together with the EU High Representative for Foreign Affairs and Security Policy Josep Borrell, presented a the European Cybersecurity Strategy for a Digital Decade. (Press release)  

In this context, to improve digital and physical resilience, the Commission has proposed two directives:

  1. The proposed Directive COM/2020/823 (NSI 2) repeals the 2016 network and information systems security Directive and standardizes measures for a high common level of cybersecurity in the Union
  2. The proposed Directive COM/2020/829 addresses the resilience of critical entities

The goal of the cybersecurity strategy is to create a secure defense capability against cyber threats through strengthened digital services and tools due to the increasing social and economic digital transformation. It also aims to strengthen the trust of citizens and businesses in services while ensuring a global and open Internet. The planned safeguards are therefore also intended to safeguard European values and fundamental rights in particular.


The EU will take action in three areas:

  1. Resilience, technological sovereignty and leadership
  2. Operational capabilities to prevent, deter and respond
  3. Cooperation to advance a global and open cyberspace
     

NSI 2 Directive Proposal:
This proposal on the new NSI 2 directive intends to adapt the existing NIS directive to current needs and thus to future proof it. In terms of content, the scope of application of supervisory regulations is expanded, primarily by creating new sectors and by granting the member states discretionary powers in this regard. The proposal also introduces a risk management concept for companies. This mainly tightens the safety requirements for them. In this context, the member states are imposed with strict supervisory measures and enforcement requirements on the national authorities. In addition, the proposal decrees coordinated disclosure and cooperation between member states and across the EU, especially in cyber crisis management.

Directive Proposal on the resilience of critical entities:
This proposal aims to ensure that service delivery in the internal market can be ensured by strengthening the resilience of critical infrastructure operators in member states. In particular, this is to be achieved through a better understanding of risks and means to manage them.

On the 15th of December 2020, Commission Executive Vice-President Margrethe Vestager and Vice President Margaritis Schinas are scheduled to present the executive’s review of the Network and Information Systems (NIS) Directive, which entered into force in August 2016. Member states had to transpose the measures into law by May 2018.

Digital for Consumers

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Legislative, including impact assessment, Article 114 TFEU, 3rd quarter 2020.

See 2021.

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Legislative, including impact assessment' Article 114 TFEU, 4th quarter 2020.

  A New Industrial Strategy for Europe

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A new industrial policy strategy comprising a bundle of individual measures

  1. Action plan for intellectual property
  2. Adaptation of EU competition law to the requirements of the digital economy / Green Deals
  3. White Paper on the distorting effects of foreign subsidies on competition in the internal market (mid-2020), which is to culminate in a legislative act in 2021.
  4. Measures to modernize and decarbonize energy-intensive industries
  5. Strengthening Europe's industrial and strategic autonomy through an action plan for critical raw materials and pharmaceuticals
  6. An alliance for clean hydrogen
  7. Further legislation and guidelines on green public procurement
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Action plan to improve implementation and enforcement of single market legislation, which aims to remove obstacles caused by breaches of EU law.

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A new SME strategy: among other things, the Commission intends to make it easier for small and medium-sized enterprises (SMEs) to go public and therefore support the creation of an Initial Public Offering (IPO) fund within the SME financing window of "InvestEU".

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Aviation Services Package

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Legislative, incl. impact assessment, Article 100(2) TFEU, Q4 2020).
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Legislative, incl. impact assessment, Article 100(2) TFEU, Q4 2020.

Towards a European Research Area

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Non-legislative, Q2 2020.

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Non-legislative, Q4 2020.

Digital Finance

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Non-legislative Act: On the 24th of September 2020 the European Commission published a Communication on a Digital Finance Strategy for the EU (press release).

Problem: Consumers and businesses are increasingly more prone to access financial services digitally, while innovative market participants are deploying new technologies, and existing business models are shifting towards digital finance. Particularly with regard to the COVID-19-pandemic, a growing proportion of in-store payments are now digital and contactless, and on-line purchases (e-commerce) have significantly increased. Therefore, as more people access financial services online and financial sector employees themselves work remotely, ensuring safe and reliable operation of digital infrastructures has also become more important.

Objective: Supporting EU’s digital transition as well as innovative projects across member states will contribute to the overall digital transformation of its economy and society and additionally bring significant benefits to both consumers and businesses. It is the objective to make the benefits of digital finance available to European consumers and businesses, along with promoting digital finance based on European values and a sound regulation of risks. The Commission prioritises the tackling of the fragmentation in the Digital Single Market for financial services so that European consumers can obtain a better access to cross-border services and European financial firms’ can scale up their digital operations. The EU regulatory framework shall facilitate digital innovation in the interest of consumers and market efficiency. Furthermore, creating a European financial data space can help promote data-driven innovation, while building on the European data strategy can facilitate access to data and data sharing within the financial sector. Lastly, the EU plans to adequately address new challenges and risks associated with the digital transformation.

Subject Matter: Specific measures include a proposal by the Commission as part of a broader initiative on AML/CFT addressing member state to harmonise rules on customer onboarding and to implement an interoperable cross-border framework for digital identities. Additional harmonised licensing and passporting regimes, cooperation with the ESAs to strengthen EFIF, and establishing an EU digital finance platform to foster cooperation between private and public stakeholders will further be explored. A new legislative framework for crypto-assets, including asset-referenced tokens and utility tokens, will help the Commission ensure that potential material regulatory obstacles to innovation stemming from legislation on financial services are removed. It will regularly provide interpretative guidance on how existing legislation on financial services is to be applied to new technologies. Moreover, a new strategy on supervisory data that shall be proposed in 2021 and a legislative proposal for a new open finance framework by mid-2022, building on and in full alignment with broader data access initiative have been announced. Finally, the Commission will propose by mid-2022 the necessary adaptations to the existing financial services legislative framework with respect to consumer protection and prudential rules, in order to protect end-users of digital finance, safeguard financial stability, protect the integrity of the EU financial sector and ensure a level playing field.

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Non-legislative Act: On the 24th of September 2020 the European Commission published a Communication on a Retail Payments Strategy for the EU (press release).

Problem: The continuous increase in cashless transactions, specifically reinforced by the COVID-19 pandemic, has shown the vital importance of safe, accessible and convenient (including contactless) payments for remote and face-to-face transactions. Considering that the EU payments market remains, to a significant degree, fragmented along national borders, as most domestic payment solutions based on cards or instant payments do not work cross-border, the Commission identifies the need for a clear ‘governance’ framework, one that develops a clear vision, setting out the expected direction of travel and placing future actions under a single, coherent and overarching policy framework.

Objective: The new retail payment strategy aspires to allow citizens and businesses in Europe to benefit from a broad and diverse range of high-quality payment solutions, supported by a competitive and innovative payments market and based on safe, efficient and accessible infrastructures. Competitive home-grown and pan–European payment solutions shall be available in order to effectively support Europe’s economic and financial sovereignty, while improving cross-border payments with non-EU jurisdictions, including remittances is to promote the international role of the euro and the EU’s ‘open strategic autonomy’. The overall objective is to generate a highly competitive payments market, benefitting all member states, whichever currency they use, where all market participants are able to compete on fair and equal terms to offer innovative and state-of-the-art payment solutions in full respect of the EU’s international commitments.

Subject Matter: The Commission will assess whether it would be appropriate to require adherence by relevant stakeholders to all, or a subset of, the additional functionalities of SEPA Instant Credit Transfer (SCT Inst.), which could also include any future standards for QR-codes. In cooperation with the European Central Bank and/or the European Banking Authority (EBA), it will also examine whether specific measures should be taken to enhance the effectiveness of the crisis management of payment systems, and to ensure sound mitigation measures on the liquidity risk for financial institutions resulting from the rapid, low-friction outflow of funds via instant payments. By 2023, the feasibility of developing a ‘label’ for eligible pan-European payment solutions in addition to the facilitation of the deployment of European specifications for contactless card-based payments (CPACE) will be explored. Moreover, the Commission will continue to provide guidance, if required, to ensure that instant payments solutions and their respective business models comply with EU competition rule.

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Proposal: On the 24th of September 2020 the European Commission published a Proposal for a Regulation on Markets in Crypto-assets, and amending Directive (EU) 2019/1937 (press release).

Problem: In order to ensure that the EU is fit for the digital age and to build a future-ready economy that works for the people by enabling and supporting the potential of digital finance in terms of innovation and competition while mitigating the risks, the Commission undertakes one of the major applications of blockchain technology in finance, crypto-assets. Considering that as of right now most crypto-assets fall outside the scope of EU financial services legislation and therefore are not subject to provisions on consumer and investor protection and market integrity, a common approach adopted by all member states is crucial to make the most of the opportunities they create and address the new risks they may pose.

Objective: The Commission includes four main objectives that go as follows: providing legal clarity and certainty to promote the safe development of crypto-assets and use of DLT in financial services; supporting innovation and fair competition by creating an enabling framework for the issuance and provision of services related to crypto-assets; ensuring a high level of consumer and investor protection and market integrity, and lastly addressing potential financial stability and monetary policy risks that could arise from an increased use of crypto-assets and DLT. It is further highlighted the need to remove regulatory obstacles to the issuance, trading and post-trading of crypto-assets that qualify as financial instruments, while respecting the principle of technological neutrality. Additionally, the sources of funding for companies shall be expanded through increased Initial Coin Offerings and Securities Token Offerings. Limiting the risks of fraud and illicit practices in the crypto-asset markets as well as allowing EU consumers and investors to access new investment opportunities or new types of payment instruments in particular for cross-border situations are also on the agenda.

Subject Matter: For the insurance and admission to trading of crypto-assets transparency and disclosure requirements as well as the authorisation and supervision of crypto-asset service providers and issuers of asset-referenced tokens and issuers of electronic money tokens are settled. The Proposal presents uniform rules regarding the operation, organisation and governance of issuers of asset-referenced tokens, issuers of electronic money tokens and crypto-asset service providers in addition to consumer protection rules for the issuance, trading, exchange and custody of crypto-assets. Lastly, measures to prevent market abuse to ensure the integrity of crypto-asset markets are provided. The Commission shall establish a detailed programme for monitoring the outputs and impacts of this initiative, as well as monitor the effects of the new requirements.

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The Proposal for a Regulation on the Operational Resilience of Digital Systems aims to help block cyber-attacks and improve the supervision of outsourced services.

With the package, the Commission aims in particular to promote Europe's competitiveness and innovation in the financial sector, with four main objectives:

  1. Combating the fragmentation of the digital single market for financial services
  2. EU digital innovations should be in the interest of consumers and facilitate market efficiency (ensuring consumer protection and financial stability)
  3. Creation of a European Financial Data Space to promote data-driven innovation, building on the European Data Strategy
  4. Addressing the challenges and risks associated with the digital transformation, in particular to promote resilience, privacy and appropriate regulatory monitoring
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The Proposal for a Regulation on a Pilot Scheme for Market Infrastructures based on Distributed Ledger Technology aims to ensure an adequate level of consumer and investor protection, to provide legal certainty for crypt assets, to enable innovative companies to use block chain technology, distributed ledger technology ("DLT") and crypt assets, and to safeguard financial stability. Crypto values are one of the most important applications of block chain technology in finance. The Regulation lays down requirements (operating license, operating conditions, supervision, etc.) for multilateral trading facilities and securities settlement systems using distributed ledger technology ("DLT market infrastructures"). DLT is a class of technologies that support the decentralized recording of encrypted data.

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The new legal framework also includes a Proposal for a Directive that amends and intends to clarify existing European financial services directives and establish a temporary exemption for multilateral trading facilities in order to strengthen the overall operational stability of digital systems and to ensure legal certainty with regard to Crypto-Assets.

ZEI Related Publications

Industry 4.0: SMEs Challenges and Opportunities in the Era of Digitalization,

Chiara Ristuccia

ZEI Discussion Paper C 252 / 2019

Die vierte industrielle Revolution ändert unser Leben tiefgreifend. Industrie 4.0 bietet der Wirtschaft in gleichem Maße Chancen und Herausforderungen, insbesondere für kleine und mittelständische Betriebe. Internet-Bedrohungen häufen sich, sodass auch kleine und mittlere Betriebe effiziente Lösung zur Cybersicherheit und zum Schutz ihrer Daten benötigen. Investitionen in neue Technologien müssen ebenso getätigt werden wie die Verbreitung digitaler Kompetenzen. Die Staaten der europäischen Union haben gezielte Initiativen gefördert, dabei aber aber unterschiedliche Stufen der Digitalisierung erreicht. Diese Publikation analysiert die primären Herausforderungen, denen Unternehmen sich stellen müssen, um mit den neusten Technologien Schritt zu halten und beleuchtet den aktuellen Stand der Reformen zur digitalen Transformation. Das Paper macht deutlich, dass die Europäische Union eine Vorreiterrolle bei der Unterstützung von Unternehmen und Bürgern spielen kann, um so den neuen Herausforderungen zu begegnen.

Priority 2: European Digital Single Market or the Collective Failure of Individuals,

Dominique Roch

In: Stüwe, Robert / Panayotopoulos, Thomas (Hrsg.): The Juncker Commission. Politicizing EU Policies (Schriftenreihe des Zentrum für Europäische Integrationsforschung, Bd. 79), Nomos: Baden-Baden 2020, S. 91-107, ISBN 978-3-8487-5597-4.

Das primäre Erkenntnisinteresse des Buches besteht darin, Strategien der Europäischen Kommission beim Umgang mit dem Phänomen der Politisierung  in der EU‐Gesetzgebung zu erforschen. In einer Fallstudie zur Amtszeit von Präsident Jean‐Claude Juncker analysieren die Autoren des Sammelbandes, wie die EU‐Kommission zwischen 2014 und 2019 bestimmte politische Schwerpunkte gesetzt hat, um ihre Agenda voranzutreiben. Gegenstand der Analyse sind die zehn politischen Prioritäten der Juncker‐Kommission aus den jährlichen Arbeitsprogrammen seit 2014. Ausgangspunkt der Studie ist das von Juncker proklamierte Selbstverständnis als „politischer Kommission“. Die Bewertung der „Politisierung“ integrationspolitischer Vorhaben fällt dabei ambivalent aus: Auf der einen Seite hat die Juncker Kommission politisierte Themen gezielt aufgegriffen und als Gelegenheiten zur politischen Führung  sowie zur Schärfung des eigenen institutionellen Profils genutzt. Auf der anderen Seite sah sich die EU‐Kommission zuweilen gezwungen, bei Krisen und  Kontroversen Schadensbegrenzung zu betreiben.

A Europe Fit for the Digital Age

Carlos Deniz Cesarano,

In: Robert Stüwe / Sally Bramers (eds.): ZEI Future of Europe Observer. Von der Leyen:Still caught in Corona Calamities, Jg. 9 Nr. 1 April 2021, S. 4-5.

Diese Ausgabe des ZEI Future of Europe Observer befasst sich mit der Umsetzung des ersten Arbeitsprogramms der von der
Leyen-Kommission im Rahmen des ZEI-Forschungsprojekts "Regieren und Regulieren in der Europäischen Union". Ergänzt durch Visualisierungen der bewährten ZEI Monitor-Ampel, bietet das Magazin Analysen zum Arbeitsfortschritt in den sechs politischen Prioritäten der Europäischen Kommission.

Chancen und Grenzen europäischer Cybersicherheitspolitik

Johannes Wiggen

ZEI Discussion Paper C 261/2020

Wie hat die EU bislang versucht, sich und ihre Mitgliedsstaaten vor staatlichen „Cyberattacken“ zu schützen bzw. diese zu vermeiden? Dieses Papier überträgt das Cybersicherheitsdilemma, das als einziges politikwissenschaftliches Konzept die Logik und Dynamik hinter Netzwerkoperationen erklärt, auf den Sicherheitsakteur EU, um die bislang von der EU unternommenen Politiken zu rekonstruieren sowie deren Effektivität zu bewerten. Das Papier argumentiert, dass sich die Cyber-Diplomatie der EU verstärkt auf den Aufbau von Vertrauen mit nicht-gleichgesinnten Staaten und die Etablierung eines zwischenstaatlichen Status quo im Umgang mit Cyberoperationen konzentrieren sollte. Zur Signalisierung ihrer friedvollen Absichten und um so einen unilateralen Beitrag zur Cybersicherheit aller Staaten zu leisten, sollte die EU einen Schwachstellenmanagementprozess verabschieden sowie sich pro-Verschlüsselung positionieren. Des Weiteren sollten die EU-28 Cybersicherheit defensiv denken, um das Cybersicherheitsdilemma nicht weiter zu befeuern, und deutlich machen, dass nur Cyberoperationen, die vergleichbar eines Militärschlages sind, mit militärischer Gewalt beantwortet werden.

Archive

Further publications can be found in the ZEI archive

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