Ban Chinese Platforms? No, Europe Regulates Them

The US is forcing a sale of TikTok. Europe is using the Digital Services Act to reign in Chinese Internet companies.

Chinese Internet juggernauts are a threat. Fast fashion platform Shein shows a disregard for ethics: it steals rivals’ designs and subjects its factory workers to conditions of virtual slavery, ByteDance’s TikTok’s behavior similarly deserves no sympathy.  

But ban them?  

That goes too far, restricting free enterprise and free speech. Some US platforms, notably Twitter and Meta, pose similar dangers as their Chinese counterparts. The solution is to force all platforms to improve their fight against illegal content, be it dangerous toys or dangerous speech. Although Europe’s approach faces significant enforcement challenges, the US should follow suit and find appropriate regulations. 

The European Union’s flagship regulation on illegal content is the new Digital Services Act. Among other obligations, it requires platforms to allow third parties to report alleged illegal content and to commit to transparency around online advertising and recommender systems. Noncompliance risks, millions, even billions of euros, of fines of up to 6% of their global revenues.  

The largest platforms that count more than 45 million monthly users within the European Union are subject to additional requirements. These Very Large Online Platforms (VLOPS in European jargon) must provide risk assessment reports, and put in place mitigation measures to address risks such as child sexual abuse material and deepfake pornography.  

In April, China’s Shein reported an average of 108 million European visitors per month, more than double the limit required for a company to be designated a VLOP. It joined Meta, Apple, Alphabet, ByteDance, Amazon, and Microsoft. 

Given Shein’s excesses, this is good. Shein breaches health legislation by using illegal chemicals in its clothes. Its success is based on European consumers’ willingness to turn a blind eye to this appalling behavior as long as they can access fast fashion at low prices. Who cares about Chinese workers, the health of the planet, or fashion designers? 

As a speech platform, TikTok presents a different type of danger than counterfeit clothes. More than 170 million Americans use TikTok, half the population, and the social network has changed the country in many ways by penetrating society at all levels, from culture to politics through trends, news, political campaigns, and even recipes. No specific evidence has been presented for banning it and the company has vowed to fight the move in the courts, an appeal based on the First Amendment. The ban on TikTok law signals an interesting turning point: forcing the divestment or banning a foreign social network is no different from what China has been criticized for doing. 

In Europe, the DSA treats both Chinese and American platforms as equally dangerous. The European Commission opened a probe into TikTok’s practice of paying users to watch videos, arguing it poses a danger to the mental health of its users by generating addictive behavior. The company responded by eliminating the reward feature. 

The EU is expending equal energy investigating both Twitter and Meta. Under the DSA, it is probing Elon Musk’s decision to slash Twitter’s content moderation team and investigating Meta’s political advertising. 

A big uncertainty is whether the Europe will be able to enforce its new regulations. So far, Shein, Twitter, and Meta face no penalties. The EU’s DSA team numbers only a handful of staffers.  

Many also question whether the law is strict enough. European Parliamentarian Christel Schaldemose, the lead lawmaker on the DSA, is pushing to limit social media to teens 15 years old or older. “I am very keen on making sure that the Commission will keep on being strong on the enforcement of the DSA,” said MEP Schaldemose. “Every day we see new examples where the platforms haven’t done what they’re supposed to do.” 

It would be nice to think that the US effort to ban TikTok or strip it of its ties to China might evolve into one that protects the privacy of Americans from all predatory companies, regardless of their nationality. Unfortunately, I am not hopeful. Americans seem to already have normalized surveillance and do not expect any serious action by their government to protect them. 

Europe does not have a silver bullet. But regulation is preferable to bans. 

Enrique Dans is a Professor of Innovation at IE University (Madrid) and a Non-resident Fellow with the Digital Innovation Initiative at the Center for European Policy Analysis. 

Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions are those of the author and do not necessarily represent the position or views of the institutions they represent or the Center for European Policy Analysis.