Audiovisual Media Services (Amendment) (EU Exit) Regulations 2020

Baroness Barran Excerpts

Friday 27th November 2020 Lords Chamber

Moved by

[Baroness Barran]

That the draft Regulations laid before the House on 15 October be approved.

Relevant document: 32nd Report from the Secondary Legislation Scrutiny Committee

[The Parliamentary Under-Secretary of State, Department for Digital, Culture, Media and Sport (Baroness Barran) (Con)]

My Lords, I am pleased to introduce this instrument, laid in both Houses on 15 October, which is being made under the European Union (Withdrawal) Act 2018. These regulations remedy certain failures of retained EU law arising from the withdrawal of the United Kingdom from the EU. This instrument seeks to maintain, but not expand, Ofcom’s remit to regulate video-sharing platform services. This intervention is necessary to ensure the law remains operable beyond the end of the transition period.

The EU’s audiovisual media services directive, known as the AVMS directive, governs the co-ordination of national legislation on audio-visual media services. The AVMS directive was initially implemented into UK law in 2010, primarily by way of amendments to UK broadcasting legislation. The directive was subsequently revised in 2018. The UK Audiovisual Media Services Regulations 2020, which transposed the revised AVMS directive, were made and laid in Parliament on 30 September. Those regulations came into force on 1 November and introduced, for the first time, rules for video-sharing platform services. The Government have appointed Ofcom as the regulator for these services. The new rules ensure that platforms falling within UK jurisdiction have appropriate systems and processes to protect the public, including minors, from illegal and harmful material.

There were three key requirements placed on video-sharing platforms under the regulations. These were: to take appropriate measures to protect minors under 18 from harmful content, to take appropriate measures to protect the general public from harmful and certain illegal content, and to introduce standards around advertising. I also draw the attention of the House to the report from the Secondary Legislation Scrutiny Committee considering this instrument, and I thank its members for their work.

I will now address the committee’s concerns regarding jurisdiction. The AVMS directive sets out technical rules governing when a platform falls within a country’s jurisdiction. First, there must be a physical presence, or a group undertaking, of the platform in the country. Where there is a physical presence in more than one country, jurisdiction is decided on the basis of factors such as whether the platform is established in that country, whether the platform’s main economic activity is centred in that country, and the hierarchy of group undertakings as set out by the directive.

Under the revised AVMS directive, each EU member state and the UK is responsible for regulating only the video-sharing platforms that fall within its jurisdiction. There will be only one country that has jurisdiction for each platform at any one time. However, if a platform has no physical presence in any country covered by the AVMS directive, then no country will have jurisdiction over it, even if the platform provides services in those countries.

Through this instrument, we are seeking to maintain the same position for Ofcom’s remit beyond the end of the transition period. This position allows Ofcom to regulate video-sharing platforms established in the UK and additionally regulate platforms that have a physical presence in the UK but not in any other country covered by the AVMS directive. Although Ofcom’s remit will not be extended to include platforms established elsewhere in the EU, we believe UK users will indirectly benefit from the EU’s regulation of platforms under the AVMS directive. The regulation under this regime is systems regulation, not content regulation. We therefore expect that as platforms based outside of the UK will set up and invest in systems to comply with the AVMS regulations, it is probable that these same systems will also be introduced for their UK subsidiaries.

In the absence of this instrument, Ofcom would no longer be able to regulate any video-sharing platforms. This would result in an unacceptable regulatory gap and a lack of protection for UK users using these services. Our approach also mitigates the small risk that a video- sharing platform offering services to countries covered by the AVMS directive, but not the UK, would establish itself in the UK in order to circumvent EU law.

While we recognise that most children have a positive experience online, the reality is that the impact of harmful content and activity online can be particularly damaging for children. Over three-quarters of UK adults also express a deep concern about the internet. The UK is one of only three countries to have transposed the revised directive thus far, evidencing our commitment to protecting users online.

These regulations also pave the way for the upcoming online harms regulatory regime. Given that the online harms regulatory framework shares broadly the same objectives as the video-sharing platform regime, it is the Government’s intention that the regulation of video-sharing platforms in the UK will be superseded by the online harms legislation, once the latter comes into force. Further details on the plans for online harms regulation will be set out in the full government response to the consultation on the Online Harms White Paper, which is due to be published later this year, with draft legislation ready in early 2021. With that, I beg to move.

--- Later in debate ---

[Baroness Barran (Con)]

I thank all noble Lords for their contributions and probing questions about these regulations. I will endeavour to answer as many as possible in the coming minutes, but if I cannot answer any at the Dispatch Box I will write to all noble Lords and place a copy of the letter in the House Library. I will start by addressing some of the concerns about the scope and working of these regulations before moving on to the questions about the timing of the online harms Bill.

The noble Lord, Lord Blunkett, my noble friend Lord Moynihan and other noble Lords asked how many video-sharing platforms would be regulated by Ofcom. My understanding is that Ofcom currently anticipates that only a small number of services will fall within the UK’s jurisdiction. We expect this to include platforms such as Vimeo and Twitch. However, it is Ofcom’s role to determine which platforms are in scope, and it will be able to do this once it has engaged fully with platforms and concluded its consultations on guidance and scope. Platforms providing services which fall within UK jurisdictions will be required to notify Ofcom of provision of those services from April 2021.

The noble Lords, Lord Clement-Jones and Lord Foster, asked about our relationship with existing EU and EEA regulators and our reliance on them in this interim period. VSPs established in the EEA will be regulated not by Ofcom but by the EEA state that they are established in. Without that, it would put a duty on Ofcom to regulate large social media platforms such as Facebook, for example, which are established in Ireland but which have a subsidiary here in the UK, and would involve a lot of duplication of effort and perhaps not the best use of resource. Therefore Ofcom will rely on informal co-operation with the relevant EU regulatory authorities for information regarding determination of jurisdiction and discussions on co-operation and consistency of approaches towards video-sharing platform regulations. Most of the major US video-sharing platforms have some form of physical presence in the EU, so we would expect them to be regulated under the AVMS directive by a regulator either in the UK or an EU member state.

The noble Lord, Lord Blunkett, asked specifically about TikTok and VSPs based outside the EEA. Again, enforcement will depend on whether it is carried out by a UK regulator on UK jurisdiction. However, if, for example, a VSP was based in China, had no establishment in the UK or parent subsidiary or group undertaking in either the EEA or the UK, it would not fall under UK jurisdiction; indeed, that is just a reflection of the status quo today. If TikTok meets the criteria of being established in the UK, it would in all likelihood be regulated by Ofcom, but we cannot currently confirm whether it would fall under UK regulation. The noble Lord, Lord Bassam, also raised the same points on TikTok.

The noble Lord, Lord Clement-Jones, asked about the appropriate measures that video-sharing platforms will be required to comply with. They are to take appropriate measures to protect minors under 18 from harmful content, to protect the general public from incitement to hatred and violence and certain illegal content, and to introduce standards around advertising. As I am sure that he is aware, the revised AVMS directive sets out a list of 10 appropriate measures that video-sharing platforms may implement to achieve these protection purposes, which includes setting terms and conditions for their users.

My noble friend Lord Naseby asked about the timing of the second statutory instrument that is required to deal with remaining technical deficiencies in UK law relating to the AVMS directive. We intend to lay that instrument later this year using the negative procedure.

The noble Lords, Lord Bhatia and Lord Mann, asked about enforcement. Ofcom has a range of formal enforcement powers, including issuing enforcement notices requiring action if a platform is in breach of its obligations in not taking appropriate measures to protect users or indeed failing to implement those measures adequately. It can impose financial penalties of up to 5% of a service’s qualifying revenue or £250,000, whichever is greater, and in the most serious instances can issue a direction to suspend or restrict a platform provider from providing a service. Specifically on harmful content, this regulatory regime looks at regulation of systems and, with regard to the terrorist content to which the noble Lord, Lord Mann, referred, the responsibility there lies with the Home Office.

The noble Lord, Lord Foster, asked about the relationships of the new digital arm—if that is the right word—of the Competition and Markets Authority. Obviously that was announced very recently, but my understanding is that it will liaise with all the relevant regulators, including of course Ofcom.

I turn to the heart of many of your Lordships’ questions about the timing and approach in the forthcoming online harms Bill. The Government remain firmly committed to making the UK the safest place to be online, and the DCMS and Home Office are working at pace to introduce this legislation. We will publish a full government response to the online harms White Paper consultation later this year, which will include more detailed proposals on online harms regulation and will be published alongside interim voluntary codes on tackling online terrorist and child sexual exploitation and abuse content and activity. We will follow the full government response with legislation which will be ready early next year. I look forward to working with many of your Lordships on that as those plans develop.

The noble Earl, Lord Erroll, and the noble Lord, Lord Foster, asked specifically about age verification and age assurance. Those sit within the crucial wider approach of this Government to addressing online harms, which includes placing a duty of care on companies that host this content. Clearly, age assurance and age verification play an important part, but it is critical that our approach should be future-proofed for any particular technology. We expect Ofcom to decide how this will work through codes of practice, which will be regularly updated.

Both noble Lords referred to PAS 1296; we absolutely recognise that technical standards have an important role to play. That was why we committed funding to support the update of the standard and will promote its use, in line with our support of a standards approach which preserves the voluntary nature of technical standards, while providing a future-proof, clear and innovation-friendly approach for the industry. Companies can take alternative action to achieve those outcomes, as long as the outcome achieved is as good as, or better than, that set out in the code of practice.

I hope that I have addressed most of your Lordships’ questions and, with that, I commend these regulations to the House.

Motion agreed.