Tech companies in breach could face fines up to six percent of their global revenue.
Europe just released a proposal for a new set of consumer protection rules called the Digital Fairness Act (DFA), the EU Commission wrote in a news release. The bloc is targeting practices that harm children and push people into spending more, including things like unclear pricing, addictive design features, ads aimed at minors and "dark patterns" like hard-to-cancel subscriptions. The penalty for non-compliance could be up to six percent of a company's annual revenue, according to the draft copy.
"Our consumer protection rules will help ensure that businesses compete on the merits of their products and services, not on their ability to exploit consumers or their ability to evade the rules," said EU justice chief Michael McGrath in a statement. "We are not making it harder to do business, we are making it harder to do business unfairly."
The act seeks to protect consumers in a number of ways, like banning dark patterns, forcing clear and transparent online pricing for cultural and sports events and allowing consumers to turn off "addictive design features that encourage excessive or compulsive spending. It would also restrict unfair practices that encourage overspending by minors, like pay-to-win in games (loot boxes) and persistent prompts.
The DFA also addresses influencer marketing, requiring transparency from content creators about commercial content. It would also take on unfair personalized ads and prices that target minors, while putting an end to "subscription traps" that are difficult to cancel.
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