Tech companies face fines for non-compliance with Irish law

Online platforms such as Google-owned YouTube and Facebook could be fined as much as 10 per cent of their Irish turnover if they fail to comply with harmful content legislation under "serious" financial sanctions in the Government's sweeping Online Safety and Media Regulation Bill.

The finalised general scheme of the Bill, which also regulates video-on-demand services such as Netflix and Disney+ for the first time, allows for senior technology sector executives to be held criminally liable if services fail to comply with warning notices issued by the proposed online safety commissioner.

The Bill is designed to tackle the spread and amplification of criminal online material, cyberbullying and material promoting eating disorders, self-harm or suicide. The maximum fine for non-compliance is 10 per cent of turnover or €20 million, whichever is the higher, which could mean billions in the case of the larger tech companies.

"I am pleased to see progress in relation to this important piece of legislation," said Minister for Media Catherine Martin.

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Separately, video-on-demand platforms operating in the State, notably Apple TV+, must ensure that at least 30 per cent of their catalogues are "European works", which can include content that originates from the UK.

The introduction of such a quota is facilitated by the European Union’s revised audio-visual services media directive and similar measures being introduced in other member states mean other video-on-demand companies will also be subject to a quota.

The Bill, which will transpose the updated directive into Irish law, requires video-on-demand services in the State to sign up to codes and rules overseen by the new Media Commission.

The commission, which will be funded by an industry levy, will replace the Broadcasting Authority of Ireland (BAI) and will also regulate harmful online content as part of its wider remit. Broadcasters already pay a levy to the BAI, but online services will be required to do so for the first time.

“In some circumstances, the Media Commission will have a role in regulating certain companies with European headquarters established in Ireland on a pan-EU basis. This includes a number of major global companies such as Apple, YouTube and Facebook,” Ms Martin said.

“For this reason, potential financial sanctions must act as a suitable deterrent and be sufficient to prevent any companies of this scale gaining an economic benefit as a result of non-compliance.”

The online safety commissioner will be accompanied by a broadcasting commissioner, who will oversee existing BAI functions, and an on-demand audio-visual services commissioners.

Up to a maximum of six commissioners may be appointed at a later date as part of a major expansion of media regulation in the State, with the new body expected to have four times the number of staff as the BAI.

Future content levy

The Bill also contains a provision allowing for a content levy to be applied to any overseas-based video-on-demand company or broadcaster targeting Irish audiences. Industry bodies have lobbied for a substantial content fund to be set up from such a levy to support the Irish audio-visual sector.

The Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media is now undertaking further research on how such a levy could work and whether the benefits would outweigh the risks.

The research will explore how a content levy could be applied in a manner that respects EU rules on state aid, as well as whether the measure would mean levied on-demand companies such as Netflix, Disney+, Prime Video and Apple TV+, as well as broadcasters such as Sky, could then in turn access the content fund to finance their productions.

Ms Martin said the research would be undertaken to demonstrate that the levy “would be of sufficient benefit” and “provide meaningful support” to the Irish content industry.

“For many years, light touch regulation has been the norm for video-on-demand services. The Online Safety and Media Regulation Bill will establish more appropriate regulation of these services and ensure that they are subjected to similar regulatory obligations as television broadcasters.”

Screen Ireland chief executive Désirée Finnegan told the Oireachtas media committee on Wednesday afternoon that the organisation was "very supportive" of a content levy and believed the 30 per cent works quota would be "really significant for Irish companies".

Screen Producers Ireland, which represents independent producers in the audio-visual sector, welcomed the publication of the finalised general scheme of the bill, but said it was “concerned that there is no clear timelines or levy percentages” within it.

“Many European countries have already introduced a content levy and/or investment obligation on these services,” said SPI.

“It is imperative that we do not delay acting on this opportunity and miss out on funding to produce original Irish stories and create employment in the film and TV industry.”

Under another measure in the Bill, commercial television broadcasters such as Virgin Media Television will benefit from greater flexibility in how much advertising can be broadcast per hour.