The UK is risking losing the business generated by major US tech companies, as the row over London’s sweeping censorship law, the Online Safety Act, escalates in a number of different ways.
The law’s declarative purpose is to, above all, provide a safer online environment for minors – but critics from civil society, privacy campaigners, and, the industry, have consistently pointed out that it in fact ushers in more censorship, including through age verification.
Not only are the tech companies, under the new law, expected to curtail their users’ speech, and if they are found to be in breach of these rules, pay exorbitant fines – they are also expected to effectively fund the highly controversial legislative push, to the tune of about 0.02 percent of their global revenue.
That would amount to X, Google, Apple, Microsoft, Meta, TikTok, and a number of others, paying the equivalent of about $88.2 million per year – in order to fund the law’s enforcer, Ofcom.
One of the many problems with the Online Safety Act is the idea to “tax” foreign companies in this way, considering the legal jurisdiction – in other words, why would companies from abroad be expected to have to fund any country’s legislative effort, let alone one as contentious as this.
Another facet is that while the percentage would mean a lot of money to the richest of the Big Tech class – some of the less profitable ones would be proportionally hit more heavily.
According to The Telegraph, Uber was among those signaling that, basically – its business in the UK may not be worth the bother.
The UK press is citing Uber representatives as saying the effect of the Online Safety Act’s levies may have the effect of driving tech companies out of the country – but more than that, affecting large global businesses to also possibly “be dissuaded from launching their products in the UK – or growing their business there – given that this regime would capture their worldwide revenue.”
A spokesperson for Ofcom said that the regulator thinks the fee proposal is “fair and proportionate” – and one that is in place in order to “deter” companies from failing to comply.
So we have a hint – or a whiff – of some “pre-crime” language in there. Nevertheless, the UK government doesn’t seem to stand very firm on this controversial policy. Added the spokesperson:
“We are reviewing responses to our consultation before finalizing our proposals and advising the Secretary of State, who will ultimately decide on the fees threshold.”
