Dáil debates

Wednesday, 19 June 2024

Digital Services (Levy) Bill 2024: Second Stage


1:20 pm

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I move: "That the Bill be now read a Second Time".

I am very pleased to bring this Bill before the House today. The Bill amends the Broadcasting Act 2009, as amended by the Online Safety and Media Regulation Act 2022, to extend Coimisiún na Meán’s power to raise a levy in section 21 of that Act to cover its new functions under the digital services regulation and the terrorist content online regulation. It does this by introducing two new categories of providers, namely, those that must comply with the digital services regulation and those that must comply with the terrorist content online regulation. Second, the Bill proposes to amend the Digital Services Act 2024 to introduce a power for the Competition and Consumer Protection Commission, CCPC, to raise a levy for its new functions under the digital services regulation. Although the CCPC also has an existing power to raise a levy, it is confined to a specific and limited area of its remit, namely financial education, and it is charged to the regulated financial services firms who are not covered by the digital services regulation. Therefore, this Bill enables the CCPC to levy providers of online marketplace intermediary services to fund its new functions as a competent authority with respect to that group of online providers under the digital services regulation. The Bill models the new levy on an coimisiún's existing levy power so that the two levies are aligned. Finally, the Bill enables Coimisiún na Meán and the CCPC to agree arrangements so that one authority can collect levy funding on behalf of the other, to reduce the administrative burden on providers.

In February of this year, the Minister for Enterprise, Trade and Employment, commenced the Digital Services Act 2024. I again with to thank the House for its co-operation in the passing of that Act. That Act designated Coimisiún na Meán as lreland’s digital services co-ordinator, which is the lead competent authority for the EU digital services regulation. The Digital Services Act 2024 also designated the CCPC as a competent authority with specific responsibility for the elements of the EU regulation relating to online marketplaces. In November last year, the Minister for Justice designated Coimisiún na Meán as a competent authority to oversee the implementation of specific measures in accordance with article 5 of the EU regulation dealing with the dissemination of terrorist content online, known as the terrorist content online regulation, or T-COR.

Substantial Exchequer resources have been provided to both the digital services co-ordinator, DSC, Coimisiún na Meán and the other competent authority, the Competition and Consumer Protection Commission, to ensure effective and efficient execution of their responsibilities. Government support for the digital services co-ordinator function in an coimisiún in the second half of 2023 and for 2024 has ensured a strong foundation has been laid for the success of the digital services regulation. This support enabled the recruitment of staff with the necessary technical, legal and regulatory skills for an coimisiún to carry out its function as the Irish DSC and for the CCPC as a competent authority.

Coimisiún na Meán has had notable accomplishments in its initial phase of operation under the digital services regulation. It has developed a strong new compliance framework, established co-operation agreements with international bodies, set up an incident response protocol, established common assessment and certification processes and engagement mechanisms with the public, including a contact centre for complaints as is required in the digital services regulation. An coimisiún is playing a key role at a European level in the consistent and effective implementation of the digital services regulation in the EU. It is widely acknowledged by other European DSCs and the European Commission that Coimisiún na Meán is at the forefront of DSCs in Europe. It was one of only six legally designated and fully empowered DSCs at the inaugural meeting of the new European board for digital services, on 19 February this year.

The digital services regulation is of particular importance to Ireland given the presence here of 15 of the 24 largest service providers in Europe, known as the very large online platforms, or very large online search engines.

While Government support was necessary to ensure the regulators were ready from day one, it has always been the intention that the new functions of both Coimisiún na Meán and the CCPC would be funded by way of an industry levy from 2025 and this Bill provides the legislative basis for that.

Although Coimisiún na Meán already has a power to raise a levy, this is currently confined to levying those cohorts of service providers that come within an coimisiún’s existing competence under the Broadcasting Act 2009, as amended. These cohorts do not coincide with the service providers that are now also regulated by an coimisiún in its capacity as the digital services co-ordinator or as competent authority for the TCOR.

As I stated earlier, the CCPC also has an existing power to raise a levy, provided for in section 24B of the Consumer Protection Act 2007, as inserted by the Central Bank Reform Act 2010. However, it is confined to a specific and limited area of its remit, namely financial education and it is charged to the regulated financial services firms, which are not covered by the digital services regulation. The Bill therefore extends the levy-raising powers of Coimisiún na Meán to include those providers in scope of the digital services regulation and the TCOR, and enables the CCPC to levy providers under its competence in the Digital Services Act.

The principles in the existing Act and this Bill ensure that the levy will meet the expenses properly incurred by Coimisiún na Meán or the CCPC. In making the levy order, the regulators may exempt service providers from payment or defer payment due to consideration of the factors set out in the Act in section 21 for Coimisiún na Meán and in section 45A of this Bill for the CCPC. These factors include the financing of a provider and the nature and scale of services provided.

The Bill also ensures that the levy rate set by Coimisiún na Meán and the CCPC in respect of their competences under the digital services regulation takes account of the fact that some supervisory and enforcement functions in respect of a very large online platform or a very large online search engines are either within the sole competence of the European Commission or are shared between it and the national competent authority where that VLOP or VLOSE is established. In such instances, the European Commission may charge an annual supervisory fee under the digital services regulation.

The EU digital services regulation recognises that member states’ authorities may charge providers established in their territory a supervisory fee. Other member states, such as Austria, Hungary and Romania, have also adopted, or intend to adopt, supervisory fee models. The regulation itself has a tiered approach and targets the obligations towards the very large providers. Small and microenterprises are exempt from most of the obligations in the regulation. The Bill provides that in calculating the amount of the levy, Coimisiún na Meán must ensure the levy quantum imposed on each category of regulated entity is proportional to expenses incurred in functions related to that category.

The legislative approach to this levy contains significant principles and policies which guide Coimisiún na Meán and the CCPC in the creation of levy orders but does not unduly impede their discretion or independence. Work to implement the methods of calculation and application of the levies for 2025 will include a public consultation to seek the views of all stakeholders, including service providers that may be subject to a levy. It is important that the legislation be enacted before the summer recess so that both organisations can prepare their operations to apply the levy from next January.

Having set out the background, context and purpose, I will outline its main provisions. It is a short Bill, and it has been drafted to ensure consistency between the provisions for Coimisiún na Meán and the CCPC. The Bill has three Parts with six sections. Part 1 of the Bill deals with preliminary and general matters common to legislation, namely commencement, definitions and expenses.

Part 2 amends section 21 of the Broadcasting Act 2009, as inserted by section 8 of the Online Safety and Media Regulation Act, to extend Coimisiún na Meán's existing levy-raising powers to cover its new functions. It does this by inserting “intermediary service providers” and “hosting service providers” in the list of categories of entities on which they may impose a levy. This part also inserts a new section that enables an coimisiún to enter into an arrangement with the CCPC for the collection of a relevant levy.

Part 3 inserts three new sections into the Digital Services Act 2024. This is modelled on section 21 of the Broadcasting Act 2009 so that the new levies are set and enforced according to the same statutory rules. The first new section introduces a power for the CCPC to charge a levy on consumer online platform providers that are within its remit under the digital services regulation. It sets out the factors that must be taken into consideration, which include the financing of a provider, the nature and scale of the provider’s services and whether the provider is subject to the European Commission’s supervisory fee. It also sets out the procedures that must be followed when issuing a levy order. The second new section provides for the enforcement of levy orders, whereby a levy payable under a levy order may be recovered by the CCPC as a simple contract debt in any court of competent jurisdiction The third new section contains provisions for the CCPC to enter an arrangement with Coimisiún na Meán on the collection of a relevant levy.

The synergies generated by the colocation within Coimisiún na Meán of the supervisory and enforcement responsibilities for the digital services regulation, the EU terrorist content online regulation, and the Online Safety and Media Regulation Act 2022 already provide cost savings for the Exchequer. The co-location is enabling an efficient and cohesive implementation of this regulatory framework, for the benefit of the providers and most importantly the public.

This Bill will now provide that the full cost of enforcing these regulations will be borne by industry and not the taxpayer. The levy funding model will also enable sustainability, flexibility and independence for the regulators. I thank Deputies for their attention and I commend the Bill to the House.

1:25 pm

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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I am grateful for the opportunity to speak on this important legislation. Sinn Féin does not oppose this Bill but we do have an issue with how it is being rammed through the Dáil without any pre-legislative scrutiny by the Joint Committee on Enterprise, Trade and Employment. We will table amendments to copper-fasten the legislation to ensure that the collection of levies does not extend beyond funding the regulatory work of Coimisiún na Meán and the CCPC.

This is a short technical Bill which extends Coimisiún na Meán's and the Competition and COCC's levy-raising powers to fund new enforcement functions under the Digital Services Act and the terrorist content online regulation. The Digital Services Act, which passed through both Houses this January, brought significant changes to Irish law and to the online space. The Digital Services Act and the EU Digital Services Act seek to regulate very large online platforms and provide a more equitable online environment and address illegal and harmful content. It is hoped that it will also rein in the powers of big tech and give Internet users a bit more control over their digital lives. However, to deliver on these aims, it is important that Coimisiún na Meán and the Competition and Consumer Protection Commission can fund their regulatory work. This is where the Bill fits in.

Given the rise in disinformation and harmful content on social media and various online platforms, it is essential that these regulatory bodies can deliver on their remit. We all enjoy great advantages from using online platforms and the ability to have so much information right there at our fingertips. However, given the power of platforms, intermediary service providers and hosting services, it is important that we have regulation and well-funded regulatory bodies. Having one without the other would be ineffectual in the extreme. The Bill provides the legislative basis to: extend Coimisiún na Meán's levy-raising powers and introduce levy-raising powers for the CCPC to those service providers that are in scope of the Digital Services Act; extend the levy-raising powers to providers within the scope of the terrorist content online regulation for which Coimisiún na Meán has also been designated as a competent authority; enable Coimisiún na Meán and the CCPC to agree arrangements so that one authority can collect levy funding on behalf of the other to minimise the administrative burden on platforms supervised by both authorities.

The crux of the Bill is to allow Coimisiún na Meán to be funded by levies. Coimisiún na Meán has introduced levies for video-sharing platforms and video-on-demand providers and for broadcasters.

This legislation extends the ability to collect levies from intermediary services and hosting services to fund the work relevant to the Digital Services Act, Coimisiún na Meán and the Competition and Consumer Protection Commission. It is important to state what these services are. Intermediary service providers are online services which consist of either a mere conduit service, a caching service or a hosting service. Examples include online search engines, wireless local area networks, cloud infrastructure services or content delivery networks. Hosting services are intermediary service providers that store information at the request of the service user. Examples include cloud services and services enabling the sharing of information and content online including file storage and sharing.

The legislation also provides for Coimisiún na Meán to impose a levy on providers of online platforms that allow consumers to conclude distance contracts. This is part of the plan to make Coimisiún na Meán fully funded by levies for its regulatory activities and not dependent on the Exchequer. Sinn Féin is not opposed to this Bill, and it sees the merit in ensuring that Coimisiún na Meán can fund its own work. We are frustrated that this Bill bypassed pre-legislative scrutiny in the enterprise, trade and employment committee. This is because Coimisiún na Meán sits under the Minister for Tourism, Culture, Arts, Gaeltacht, Sport and Media, and matters relating to the commission and some of the core legislation being amended in this Bill are in the Broadcasting Act, which again falls under the Minister for media. As I said, we support the idea of Coimisiún na Meán and the CCPC being able to fund their regulatory work, but that is where this legislation must stop. It cannot be used as a back door to funding beyond that, and we will bring forward amendments to copperfasten this.

1:35 pm

Photo of Thomas GouldThomas Gould (Cork North Central, Sinn Fein)
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As my colleague said, it is disappointing we are now speaking on a Bill without any pre-legislative scrutiny being done. This is another example of the Government refusing to engage constructively in the legislative process. We saw this last week when the planning Bill was rushed through the Dáil and guillotined, and we are seeing a similar issue now with the absence of pre-legislative scrutiny. The Government should be producing legislation that can stand up to scrutiny and should not be afraid to have its legislation looked at. It is not fully clear who will be levied or when. There seems to be no clarity on this, but these are the kinds of issues that could have been teased out at the pre-legislative scrutiny stage. There are merits to this Bill, however. It is vital that Coimisiún na Meán is properly funded and that there is an input into digital services.

I raise another issue, namely, the scrapping of the TV licence. The Minister gave a commitment in this House and the committee on plans for the TV licence. We are now in the middle of June with no decision made as the issue was kicked down the road until after the European and local elections. People want an answer to what is happening with the TV licence before the Dáil goes into recess. It is clear it has fallen off the Government's agenda. We should not have to wait for another scandal to break or something else to go wrong before a decision on this regressive and outdated levy is made. We know that people want a State broadcaster. We know they want to trust the news. They want to know about issues like those that have arisen in the past few weeks where games that should be shown on free-to-air TV are being shown on GAAGO so the GAA and RTÉ can make money. However, if RTÉ is the State broadcaster, why are these games not being shown? We need a broadcaster that is funded, and one we can trust. Dragging people through the courts is not what we need to be doing at this stage.

I will also make a comment on Apple computers. It is understood that this Bill will impose a levy on Apple computers through its search engines and Internet browsers. Apple has large offices in my constituency of Cork North-Central. It is a huge employer and is currently expanding. All of this is welcome. I believe that when companies like Apple are in the heart of communities they must be encouraged to employ from the local area and contribute to that area. I have met representatives of Apple and will meet them again. I want to discuss with the company support for sporting and community organisations in my constituency. Apple is a success story, and we support that success story in my community, but we also want to see the community benefit from its success. In March, it was revealed that Apple's Irish organisation made profits last year of €66 billion. This is a huge sum of money, and it is vital that a small portion of that is redistributed to the communities in which Apple is based. We saw changes made to the regeneration programme in Knocknaheeny to facilitate Apple's expansion. The communities in Knocknaheeny and Holyhill have supported Apple for years. We now want to see Apple investing in sport, the arts, the community and the local area. Opportunities are there. We have one of the biggest companies in the world making some unbelievable profits and we want to see the northside of Cork city share in that. I do not think that is too much to ask.

Photo of Ruairi Ó MurchúRuairi Ó Murchú (Louth, Sinn Fein)
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The Sinn Féin position has been put forward already. We want to Coimisiún na Meán to be able to fund its own work, but there is frustration at the bypassing of pre-legislative scrutiny in the enterprise, trade and employment committee. Everyone has details on what the issues are with that. I hope the Government will work with the Opposition on amendments so we find the most fit-for-purpose way to ensure funding is provided.

Deputy Gould stated that when talking about broadcasting in general the issue of the TV licence needs to be addressed as soon as possible. We are talking about Coimisiún na Meán, the Digital Services Act and our capacity to engage with the big tech companies. We saw some of the online content during the recent elections. It is fair to say the big tech companies have been disingenuous in saying they are dealing with harmful content. We know the issue with the algorithms, and that they are about making sure we all stay on the platform. The more you stay on the platform, the more likely you are to buy, and the more information is garnered. All of that becomes a useful product. That is well and good, but we have all seen utterly harmful and disgraceful content that is hateful. Sometimes, you will say that is pushed by outside players and negative actors. In some cases, it is pushed by people who have their own issues. There is nothing to stop them getting on a platform and taking a video of a politician or anyone else, or just getting up and spouting whatever nonsense they want without any restraints. The facts do not come into play. If you talk to any of the major tech companies or social media operators they will say that the difficulty with certain content is that while you might not like it, it is not necessarily untruthful.

We have seen a large amount of stuff that is absolutely hateful and inaccurate, and we have seen a large amount of stuff that has a negative impact on regular people's lives and a negative impact on politicians.

Many of us can deal with it, but at times people have filmed incidents outside politicians' houses that have impacted on their families, their neighbours and so on. We need to make sure Coimisiún na Meán and the European Commission, and even An Coimisiún Toghcháin, will have the power to engage with the social media companies but I am not sure we have that toolkit, no matter how it is funded, at this time. As we know, the long-term impact of this could have catastrophic effects for democracy. In the case of people who constantly talk about freedom of speech, it is often just freedom of speech for them and then their right to attack others.

This is having a very negative impact. While this could to some extent be said about all of us as politicians, given we could probably do some of our business, especially online, in a nicer and more collegial way, that is not to say there should not be vociferous debates or that we should not make political points. The fact is there is utterly hateful content and a huge number of bots, and many people will post the most hateful stuff. I have found it amusing at times that people who are really nice in real life can be utterly hateful online, and even when you approach them expecting there to be a major row, they often thank you for coming back to them.

I am talking about something a lot more serious than that, however. I barely engage online and I have not received much of this, but I know that certain people have done across the board and that it is utterly reprehensible. Malevolent, hateful content can fly every which way, and I would love to see a well-funded Coimisiún na Meán and, as I said, An Coimisiún Toghcháin. Again, some of this will have to happen at a governmental level, while other parts will have to happen at European Commission level, but we need to have the toolkit to take to task TikTok and Meta, whether Facebook or Instagram. It will be a very difficult job to take X to task, on the basis of the ethos that seems to obtain there at this time.

There also needs to be a realistic conversation about the impact this has on many impressionable people, including a large proportion of young people. Advertising works. The big firms spend millions upon millions because it works, not because it does not, but the problem is there could be the craziest ideas and all it takes is for a small percentage of people to put them up in hateful content and that package will be just ready to fly. We talk about the broadcasting ban, or moratorium, during elections but everyone at this stage is terrified of content that does not even need to be accurate. It could be utterly crazy, and social media platforms are weaponised such that once the message hits, it is all over the place and by the time it is taken down or retracted, the damage will have been done. This is having a huge impact and we need to have the capacity to deal with these sorts of issues.

Representatives of An Coimisiún Toghcháin and Coimisiún na Meán have appeared before Oireachtas committees and spoken about their really positive interactions with the social media companies, and we have all had interactions with them at meetings of various committees, but I have yet to see an improvement regarding the content we see online. The hateful stuff runs and reaches everywhere. Moreover, I have yet to see the employment of artificial intelligence or the technological capacity of these companies to address these issues. This is serious. There is a health and safety issue, and we all know of people across the board who have been injured or attacked. We are afraid of what could happen and we have seen what has happened to MPs in England and elsewhere. Nevertheless, we have yet to see a tackling of the disinformation, the misinformation and the malign content, and we really need that to happen.

I know it is early days and we need to get right the funding and specifically what we are dealing with here but, beyond that, we need to make sure we have the toolkit that can deal with these companies. We all know how this works with these companies. Unless they are under the cosh and are facing major fines, and unless there is enforcement of this, they are not going to be interested. I understand we are talking about companies that are huge employers and about services we all use ourselves, but there needs to be a comprehensive review of the negative impact that is happening. The companies have a responsibility, and we have a responsibility to ensure they understand what they have to do.

While I have the Minister of State's ear, although I am sure Deputy Nash will also bring this up, I raise the issue of the potential for up to 85 redundancies at PayPal, a tech giant that operates, albeit largely through remote working, in Dundalk and Dublin. There has been a drip-drip of job losses for some time. There needs to be engagement from the Minister of State, the IDA and so on, and there is an onus on the company to ensure the job losses are minimised.

On top of that, there must be more than just words in the context of a commitment to Ireland. I keep getting phone calls, as do all my Oireachtas colleagues in County Louth, when we are told about the commitment but we are also told about job losses. Obviously, we want to make sure the company will survive, but we must provide the supports that are necessary to those who may lose their jobs, and I would like that number to be a lot lower than 85. Both the company and the Department need to do what they can to sell their commitment to the extent that we will not get further phone calls about job losses.

1:45 pm

Photo of Gerald NashGerald Nash (Louth, Labour)
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I will pick up from where Deputy Ó Murchú left off. I am sure the Minister of State and the Chair will indulge me in referring to the proposal, or at least the contemplation, of another round of redundancies at PayPal Ireland. Those prospective redundancies will impact on staff who were originally located at the PayPal facility in our home county of Louth, in Dundalk town, and it will also impact on those who work at the operation in Dublin. Many of those who work in Dundalk are now working remotely but they live in our region, in Drogheda or Dundalk, County Louth, or elsewhere.

Regrettably, I have spoken to Jan Eger from PayPal on more occasions than I have spoken to some of my closest friends in recent months. This is the latest in a merry-go-round of redundancies at PayPal. While it consistently reiterates its long-term commitment to Ireland, it is understandable that those of us in public office in the county and, indeed, staff who remain in its employment are sceptical about its long-term commitment to Ireland. This is another stop on the merry-go-round of redundancies at PayPal as part of its global consolidation, as it might call it, but global consolidations have impacts on people's jobs and lives and on communities.

More often than not when I am speaking to executives from firms such as PayPal, I feel as though I almost have to give them an introductory course on the statutory redundancy landscape in Ireland and their legal responsibilities, and remind them that when they enter into a consultation process under the Act and are even contemplating redundancies, information should be shared with those who will be engaged with on the workers' side over the following month to provide them with detailed financial information. Furthermore, there is an onus on the company, as I said to representatives of PayPal yesterday, to work to avoid as many redundancies as possible and to look at alternative cost-saving measures.

We take what large companies tell us at face value when they are contemplating redundancies. That it is the only option; there is no alternative. Companies need to move from the idea of shareholder value to stakeholder value and properly consider the situation in which their staff find themselves. I ask the Minister of State and his colleagues in the Department of enterprise to engage fully with PayPal and not simply take at face value the reasons it provides for contemplating redundancies. IDA Ireland needs to be clear and firm with PayPal about its ongoing commitment to Ireland. With the best will in the world and in good faith, I have no doubt the people I spoke to yesterday are convinced and persuaded PayPal has a future and I hope it has because the company will continue to employ approximately 1,500 people. Deputy Ó Murchú, I or anybody else cannot be blamed for being sceptical about that. Our experience over the last period has taught us to be sceptical. I thank the Acting Chair for his indulgence on this matter, which is separate from the Bill.

This is simple and sensible legislation to make sure the huge companies that control the provision of digital services in this country and around the world foot the bill for their own regulation. The Bill will seek that the functions of Coimisiún na Meán and the Competition and Consumer Protection Commission be funded under the Digital Services Act 2024 and EU regulations on terrorist content online through a levy on the providers of online intermediary services and hosting service providers. The Government will find opposition to this move from the industry, as it always does when it comes to increasing and improving the regulatory environment, but it must hold firm.

The EU is being sued by digital media giants Meta and TikTok over similar legislation that would levy these companies in order to fund content moderation on an EU-wide basis. That action is on the basis of which companies pay the levy and which ones escape it. The larger companies are arguing that they are paying a disproportionate amount of the total cost. What the likes of Meta and TikTok are not saying is that they also hold a disproportionate amount of power in the marketplace and have a disproportionate number of human eyes fixed on their content. The implications of this for our society, politics and democracy are there for all to see.

These providers have had it all their own way for too long and have created a wild west on the Internet where anything goes. These all-powerful and over-influential social media companies have to be reined in and it seems to me to be perfectly reasonable that they should foot the bill for that process. They created a mess in the first place and should pay for its clean-up.

The regulation of Internet content has already come up against some opposition from the big players in Ireland. Earlier this year, Coimisiún na Meán named ten video-sharing platforms that would be covered by its new online safety code. Reddit, for example, immediately took legal action when it made the list, claiming it is not a video-sharing platform. While Reddit is text-based, there can be links to video content included on its pages. The courts will make a determination on that but it is an indication the industry is prepared to fight regulation at every turn. The online safety code simply requires providers to protect children from specific types of harmful online material, including cyberbullying and content that promotes eating disorders, self-harm or suicide. Under the code, platforms will also have to prevent the uploading or sharing of a range of illegal content, including incitement to hatred or violence.

We do not need to be reminded of the position adopted by many of the social media companies when it came to the disgraceful riots in Dublin last November. They were not exactly quick off the mark in removing shameful content caused by the actions of the few in the centre of our capital city.

We have only begun to scratch the surface of the problems caused by online harm. The new online safety contact centre operated by Coimisiún na Meán received 108 emails and calls from the victims of online harm in its first week of operation. That was at a time when most people would scarcely have known the new service existed, so these numbers are likely to grow significantly. All that Coimisiún na Meán is tasked with doing in this area is to make sure digital providers simply follow the rules that already exist. I see no reason those affected by harmful content on the Internet should have to pay for its policing. Those who provide a platform for it need to foot the bill or else start to get serious about not allowing harmful content or, let us be clear, illegal content on the platform in the first place.

Coimisiún na Meán has been tasked with critically important work and must be properly funded. These funds should come, in the main, from the industry that has profited from the issues Coimisiún na Meán has been set up to tackle. The days of the wild west on the Internet must be brought to a close and a new frontier opened where the worldwide web is at least as safe a place to be in as any other public space. A level playing field that would clearly identify rules around content can be only a good thing for the industry as well. I hope it will recognise that reality and seek to co-operate with the new structures that govern its conduct instead of resisting them.

The Bill represents a sensible approach to the funding of the regulation of an industry that has gone without regulation for too long. My Labour Party colleagues and I have no difficulty supporting it.

1:55 pm

Photo of Cathal CroweCathal Crowe (Clare, Fianna Fail)
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I will not use my full speaking time in case other Members need it. A lot of people are rushing to get to the Chamber.

I welcome and support this Bill which extends Coimisiún na Meán's and the Competition and the Consumer Protection Commission's levy-raising powers to fund new enforcement functions under the Digital Services Act 2024 and the terrorist content online regulation. The Digital Services Act 2024 designated Coimisiún na Meán as the lead competent authority of the EU digital services regulation, known as the digital services co-ordinator and the Competition and Consumer Protection Commission as the competent authority with responsibility for the oversight of obligations in the digital services regulation that apply only to providers of online marketplace services. Coimisiún na Meán was also designated as competent authority for overseeing the implementation of specific measures of the EU regulation on addressing the dissemination of terrorist content online, known as the terrorist content online regulation.

I agree with the previous speaker, Deputy Nash. It is very important the social media sector not only plays a role but pays for its role in the vitriol that is online. Enforcement of the sector's own rules is very lax. Just this week, I filed three different complaints to Twitter or X about the targeting of our national hero of the moment, Rhasidat Adeleke, by far-right, racist elements. She is a fantastic Irish athlete, a champion, a hero, a legend, and whatever other adjective one wants to apply, but she has a right not to be subjected to horrible vitriol. I was very disappointed to learn that the moderators at Twitter or X deemed that some of the horrible content did not meet its threshold for complaint. You would not get away with saying these things on the street, so how can you get away with it from behind the anonymity of your phone or laptop screen. It is absurd and wrong.

The sooner we have age verification, the better. I spent long enough in a classroom prior to my election to the Dáil. It was alarming how many youngsters were on Facebook and Instagram at the time. They have now moved on to TikTok. Age verification is important but so too is personal verification. We need to get to a point very soon where anyone on social media will need to have their character verified to be able to use it. The veil of anonymity is woeful.

We have often spoken about Twitter or X, as it is now called, Instagram, WhatsApp, Snapchat and all the different platforms. There is one alarming one, Tattle Life, that I want to highlight today. I only became aware of it a few months ago. I must have been living in the Stone Age or something. It is not a social media platform but a website with different threads and discussion boards about real-life people, many of whom are not celebrities. They are not all members of the British royal family. Some are prominent people who live in my locality or other villages and towns in Ireland. They include camogie stars and successful business people. and there are even some politicians on Tattle Life. There is a whole thread that dissects every part and fibre of their lives, from family life to where they live and where they went on holidays. There are sneaky photos taken of the family at the supermarket. It is horrible. We are obsessed with Mark Zuckerburg and the bigwigs but somebody in Britain is operating this website. The amount of slander on it is absolutely appalling. We need to get to a point very quickly where the operator is identifiable.

When election canvassing ended on Thursday nearly two weeks ago, we all had a fairly relaxing day at home after about six of seven weeks on the road knocking on doors and meeting people. I tried to watch television with my children that evening. Children and their parents have very different tastes in television programmes but we watched MrBeast. I do not know if the Acting Chair has watched MrBeast on YouTube but he is the most followed YouTuber in the world at the moment and has some interesting and funny content. When I was watching MrBeast, up popped Deputy Mary Lou McDonald every three or four minutes. Sinn Féin was pumping huge money into advertising so my nine-year-old and seven-year-old children got to see plenty of MrBeast and Deputy McDonald on the day before the election. I hope that will peel back a bit now because youngsters want to see more of MrBeast and less of Deputy McDonald.

2:05 pm

Photo of Aengus Ó SnodaighAengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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This Bill relates to the levy-raising powers of Coimisiún na Meán under the Broadcasting Act 2009 as amended by the Online Safety and Media Regulation Act 2022. Under section 21 of that Act, the providers of audiovisual media services, sound and broadcasting services and designated online services can be levied to meet the expenses and working capital requirements of Coimisiún na Meán. A levy order was introduced by statutory instrument on 30 April 2024 and the levy started on 1 May. Under section 159E of the Act, media service providers can be levied to support the production of European works. That section gives levy powers that have not yet been used yet we are here discussing how to expand section 21 levy powers. I am not opposed to it but it seems a bit previous. Screen Producers Ireland estimates that every year the European works levy is not introduced, the Irish film and audiovisual sector loses out on investments of €25 million or more. This is a huge figure. It means that €25 million that could support the creation of content relating to Irish culture, language, history, heritage, society and sport; the experience of people on the island of Ireland, including the experience of people of Irish descent living abroad; environmental sustainability; biodiversity; climate change; human rights; equality, diversity and inclusion; news and current affairs; international affairs; science; and education could be supported.

This Bill does not do that. We should look at how and when the European works levy is to be introduced. That is the question. Where is the viability report on which Coimisiún na Meán had been working with regard to that levy? We have not seen that yet. Levies, as well as investment obligations of up to 20% of turnover, have been or are being introduced in other EU member states and in Ireland, we are falling substantially behind in terms of fully implementing that audiovisual media services directive. Instead of expanding the levy powers to cover new online services, which is not to be opposed, are there other services or providers that could be covered by the levies? At the very least, we should be looking at ensuring that the powers we have are used.

There are other areas we should look at in terms of music-sharing platforms, ticket sales, distribution platforms and others. I am not opposed to this legislation but I am raising questions about other levies in this field that should happen.

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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I welcome the opportunity to speak to this legislation and the Social Democrats are happy to support it. The Bill gives me an opportunity to return to the Digital Services Act, which we debated late last year. At that time, it was stated that Coimisiún na Meán was funded to the tune of €6 million for 2024 despite a business case that had been developed by the commission for additional resourcing. I understood at the time the Department made an allocation of €2.7 million to the commission in respect of its functions relating directly to the Digital Services Act and its role as the digital services co-ordinator. Now that the commission has moved from being a relatively new body to being the digital services co-ordinator, has it received any further financial support ahead of legislating for its ability to raise revenue via a levy? The funding of €2.7 million that I mentioned was to provide for an additional commissioner and more staff for Coimisiún na Meán. Will the Minister of State update us in that regard? What is the headcount and the skill set as of today? Once this legislation is passed, is Coimisiún na Meán ready to start the collection of the proposed levy? It would be very useful to hear that because we are often quite critical of new entities when they are set up but they must have the resources to do the job. What is the projection in terms of the commission's ability to do some of this work as it relates to the number of staff it has?

What are the details regarding the levy? Is there any lead-in time for the liable bodies and how much is likely to be realised by the introduction of a levy? I read through the general scheme of the Bill and there is no real indication of that in it so it would be useful to get an update. Under the general scheme, where levies are imposed on providers, there could be provision for exemptions, deferrals and even refunds. The levy is designed to meet running costs of the coimisiún and the Competition and Consumer Protection Commission. It is the kind of information that would be quite useful. I missed part of the Minister of State's opening statement so it may have been included in that. Could he outline what is provided for? Looking ahead, I look forward to Coimisiún na Meán appearing before the Committee of Public Accounts at some point for a review of its audit accounts where, hopefully, we will see the finer detail in a very practical way

Has there been resistance to the introduction of the levy from industry? I know there has been but I mean in a real sense. How comparable is it to the way in which other member states are managing their functions relating to the Digital Services Act? I realise that a large number of such companies are located here so we are probably the country that will be looked to. We are the country where it is most likely to see resistance but we have a particular responsibility, given the location of so many of these companies.

It is worth noting that in today’s edition of The Irish Times, it was reported that a complaint about political ads on TikTok alleged that the company breached specific articles of the EU's Digital Services Act. If that is upheld, then the company could be hit with substantial fines. TikTok is already citing various inaccuracies in the complaint. I mention that because that some of these companies are very well resourced and could potentially bog down the work of the commission. Obviously, the Minister of State is not going to go into the detail about that but it is something we could be concerned about. I know there is the potential to fine some of these companies somewhere in the region of 6% of their annual turnover so that would be a sizeable deterrent. Consequences do change behaviour and we do need to change behaviour in the case of some of these companies.

We see the damage caused by online bullying. Something like 6.7% of the population are on Twitter. If you go by that, you would not have knocked on doors during the recent elections. The experience knocking on doors is very good. We are all able to say that. People were able to express concerns about things about which they are unhappy in a very dignified, rational and nice way. This is in total contrast to the kind of bile that often presents on Twitter. The idea that some of this is not taken down is offensive. We need to deal with that. I cannot think of the number of times people have asked me whether I was okay going around knocking on doors. I am sure everybody else experienced that but the public has a perception that this is reality. We have had the unique experience of knocking on a lot of doors and seeing that people are nice. They were always nice and will continue to be nice. If they have a problem, they will tell you what the problem is but it is certainly not articulated in the way we see online. We should not accept that as the kind of narrative that is acceptable.

I reiterate the point made about the horrible responses to Rhasidat Adeleke after her wonderful display at the European Athletics Championships and how proud of her we all are.

The idea that someone who has put such an effort into representing this country could be treated in that kind of way and for that then not be automatically seen as unacceptable is the kind of thing we have to shift. This is not us and should not represent us. Very often, people think that little bubble is Ireland and it is not.

2:15 pm

Photo of Peter FitzpatrickPeter Fitzpatrick (Louth, Independent)
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I do not like starting a debate by being negative but it was announced that there will be 85 redundancies in PayPal between Dundalk and Dublin, which is very bad news. I am a sitting TD in Dundalk. PayPal is a top company and good employer that still employs a lot of people. I do not know how many times over the past number of years we have had phone calls to tell us this is the last time this will happen.

People who work in PayPal in Dundalk and Dublin had opportunities over the past number of years to switch jobs but did not do so because PayPal said it was here for the long haul and people believed in it. These people have families, mortgages, kids going to school and everything else. It is dreadful. I am worried about the future. I do not know whether PayPal was in contact with the Minister of State, but it is definitely due a phone call because this country has done absolutely everything for PayPal. The IDA has bent over backwards for it, along with the Minister's Department and everything else.

No matter what PayPal looked for, PayPal got and it has turned around and now 85 people are being made redundant. It is not fair. There were redundancies some years ago and PayPal said that was it, but it created jobs in other countries. Given the amount of funding and commitment the Government has given to PayPal, we do not deserve that and the 1,500 people employed by the company do not deserve it either. A lot of people living all over Ireland are worried and sceptical and wonder what the future holds with PayPal. Rather than coming from the sitting TDs in the area, it would be nice for the company to get a phone call from the Minister of State's Department. PayPal keeps telling us the same thing, namely, that it is the economy or this, that or the other. The Government has pumped a fortune into PayPal and we deserve something back. Those affected are high spec. PayPal has said that it chose the area because of the people in it who are top spec, there is Dundalk Institute of Technology, DkIT, and everything else. It is a very worrying time. I would appreciate if the Minister could speak to local TDs in the area and contact PayPal to see what it says. What has happened is disappointing. It is a good employer and pays well but the redundancies have put a bad spin on that. If the Minister of State could do something about this, I would appreciate it.

The digital services levy will extend Coimisiún na Meán’s power to raise a levy under section 21 of the Broadcasting Act 2009 to cover its new functions under the digital services regulation and the terrorist content online regulation in compliance with the EU Digital Services Act. The digital economy has transformed how we live, work and do business. Companies providing digital services, such as social media platforms, online marketplaces and search engines, have seen exponential growth in their revenues. However, this growth has not always been accompanied by a corresponding contribution to the economies from which they derive their substantial earnings.

Traditional business models are taxed based on physical presence and tangible assets. In contrast, digital services companies often have a limited physical footprint in the countries where they generate significant revenue, resulting in a mismatch between where economic value is created and where it is taxed. This Bill represents a significant step forward in how we regulate and benefit from the digital economy. It is not merely a tax measure, but a strategic initiative to ensure that the growth of the digital economy translates into tangible benefits for our society and economy. These levies will apply to revenues generated from specific digital services, including online advertising, data transmission and intermediation services provided through digital platforms such as social media, search engines and online marketplaces. The Bill's provisions will help level the playing field between digital and traditional businesses, fostering a more balanced competitive environment.

The funds generated from this levy will be directed towards covering Coimisiún na Meán’s new functions as the digital services co-ordinator under the digital services regulation and as competent authority for the terrorist content online regulation. Coimisiún na Meán is currently confined to levying certain cohorts of service provides, therefore this amendment is required to extend the types of service providers by two additional categories of providers that must comply with the digital services regulation and those that must comply with the terrorist content online regulation.

It is important to note that the Bill is not an isolated effort, but part of a broader and co-ordinated international response to the challenges of digital taxation. The Digital Services (Levy) Bill 2024 aligns with global efforts to address the taxation challenges posed by the digital economy. Many countries are adopting similar measures, and this Bill positions us as a leader in this international movement.

However, I and the Regional Group of TDs have remained steadfast in our commitment to advocating for the prosperity and growth of SMEs in our towns and villages to ensure that the voices and needs of small business owners are heard. Therefore, it would be remiss of me to not mention some concerns regarding the levy. One of the primary concerns is that digital services companies may pass the additional costs of the levy onto consumers. Many SMEs, including rural and regional businesses, have already been hit by a wave of cost drivers. This levy could result in higher prices for services such as online advertising, digital subscriptions and e-commerce transactions, ultimately affecting consumers' wallets. If this happens, there is a risk that SMEs might be indirectly affected. Larger companies might reduce their spending on digital advertising or other digital services, but SMEs rely on digital services for their marketing and operations, thereby negatively impacting these smaller businesses.

It must also be considered that digital services providers might perceive the levy as a hostile move and could reduce their investment in the countries that impose such levies. This might lead to reduced job creation, slower technological advancements and decreased overall economic growth in those regions. Several digital companies in my constituency of Louth and eastern Meath have expressed concern that they might be subject to multiple levies from Coimisiún na Meán under section 21 of the Broadcasting Act, as well as having to pay European levies imposed in multiple jurisdictions across the EU, while some are arguing that the levy could stifle innovation by placing additional financial burdens on companies that drive technological advancements.

The primary focus of the Bill is on extending Coimisiún na Meán’s power to raise a levy under section 21 of the Act to cover Coimisiún na Meán’s new functions, while also amending the Digital Services Act 2024 to introduce a power for the CCPC to raise a levy for its new functions under the digital services regulation. However, it is equally important to ensure fair taxation and to emphasise Government support for the digital economy. By addressing the tax imbalance, we can foster a more competitive environment that encourages innovation and growth.

While the Digital Services (Levy) Bill 2024 seeks to address significant issues in the taxation of the digital economy, it is essential to carefully consider and address these potential negatives. We must strive to balance the need for fair taxation with the potential impacts on consumers, businesses and the broader economy. By doing so, we can create a more equitable and sustainable framework that benefits all stakeholders in the digital economy.

In an era where digital services are increasingly central to our daily lives and economic activities, it is imperative that our legislative framework keeps pace with these changes. Investing in digital infrastructure is essential for enhancing connectivity, especially in under-served and rural areas. By improving access to high-speed Internet and digital services, we can provide more constituents with opportunities to participate in the digital economy. Supporting digital literacy programmes will equip our workforce with the skills needed to thrive in a rapidly changing job market.

To conclude, the Digital Services (Levy) Bill 2024 is forward-thinking and necessary legislation. It ensures that the rapid growth of the digital economy translates into meaningful contributions to our society and economy. The Bill’s effectiveness relies partly on global co-operation. We remain committed to working with our global partners through forums like the OECD to develop cohesive and comprehensive international tax rules for the digital age. By passing this Bill, we take a decisive step towards a fairer and more equitable tax system that recognises the realities of the modern digital world.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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I want to make a small correction. Pre-legislative scrutiny was carried out on this. That was my mistake.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I thank Deputy O'Reilly for her clarification and all Deputies for their contributions, which were constructive and, at times, eclectic. I acknowledge the contributions of Deputies Fitzpatrick, Nash and Ó Murchú on PayPal. Our thoughts are with the PayPal workers. I hear their concerns. The Minister, Deputy Peter Burke, shares those concerns and we will reflect them to the Department and engage with Oireachtas representatives from Louth around that.

I will come back to the Deputy's offices on that.

As we said at the beginning the purpose of the Digital Services (Levy) Bill 2024 is to provide the legal basis for Coimisiún na Meán and the CCPC to charge a levy to fund their additional regulatory functions. It does this by amending the Broadcasting Act 2009, as amended, to extend the list of Coimisiún na Meán's leviable entities, and by amending the Digital Services Act 2024 to provide for the same levy raising power to the CCPC, for those providers, under its competence.

I will go through a number of issues that were raised. If I miss any, I will communicate directly. I thank all Deputies for their support. In regard to clarity about providers, this is set out in the digital services regulation. As also set out by Deputy O'Reilly, it includes hosting sites, social media sites, search engines and indeed online marketplaces. In essence, all online intermediaries offering the services in the Single Market established in this country, may be subject to a levy.

I agree with Deputy Ó Murchú's assertion that Coimisiún na Meán has an important job in regulating online platforms. Coimisiún na Meán will aim to prevent illegal and harmful activities online and to address the speed of disinformation as seen across the larger platforms, that has such extensive reach and influence. When it comes to systematic risks such as disinformation, hoaxes, harms to vulnerable groups and other emerging societal harms, the digital services regulations regulate very large online platforms, VLOPs, and indeed search engines. It is a requirement for those to analyse the specific risks and put in place mitigation measures. This includes addressing the seeds of disinformation, the spread of disinformation on the inauthentic use of their services.

Deputy Nash raised the issue about the EU Commission charging a supervisory fee on VLOPs. That fee is taken into consideration in this Bill. However, while the Commission has responsibility for enforcing the regulation of VLOPs, it does not do this alone or without the involvement of the digital services commission, DSC, of the country of establishment. Our commission is particularly important here, as I said, with 15 of the 24 very large online platforms based here.

In regard to Deputy Crowe's comments about electoral integrity, was it Mr. Baker?

2:25 pm

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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It was MrBeast.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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MrBeast. The European Commission provided guidance for VLOPs on this in May 2024. It sets out processes for those providers to follow to enable them to achieve the risk mitigation measures in this space. It sets out actions that can be taken before, during and after the election period. Coimisiún na Meán and the Electoral Commission have been engaging closely on this. However, there is no broadcast moratorium as we understand it in the traditional sense for online broadcasting or advertising.

Deputy Murphy referred extensively to funding. As referred to by the Deputy, Coimisiún na Meán received €2.7 million for setting up operations in 2023 before it opened for business effectively as a new DSC on 17 February 2024. For 2024, it received a total of €6 million and it has sought additional funding this year which my Department is working with the commission to progress. The commission has to prepare a business case for funding. That business case has to be assessed by the Department and there is good and constructive engagement between our Departments and between the Department of Expenditure, National Development Plan Delivery and Reform, on this. Recruitment of skilled staff has been successful with a current full-time equivalent of 42.5 staff. It is on target to meet its full sanctioned complement of 79 by October. I thank John Evans, the digital services commissioner and his team at Coimisiún na Meán but especially the officials of my own Department who worked incredibly hard to get this service up and running in the way it has.

In relation to the timeline for the levy, Coimisiún na Meán initiated a project to develop and implement its system for the calculation of the levies. The main deliverables will include the list of entities to be levied, the proposed levy mode and stakeholder consultations.

Deputy Ó Snodaigh raised an important point around existing levies and we will engage with him directly on that.

As we come to the end of this Stage of the Bill, we can reflect that we have put huge emphasis on both the Digital Services Act and on the Digital Services (Levy) Bill. We provided the resources that I have reflected and we provided additional resources to CCPC for its additional responsibilities. This Bill now allows us to move forward to a fully levy-funded model for these regulators. The provisions of this Bill will ensure they are appropriately resourced to undertake their functions and obligations as required under EU digital regulations. It reduces the burden on the Exchequer, ensuring that regulators are self-financing in their functions.

I thank the Office of the Attorney General and the Office of the Parliamentary Counsel for their commitment, as well as the select committee on enterprise. I thank all the Deputies for their engagement and look forward to Committee Stage. I thank them for their co-operation on the passage of this legislation.

Question put and agreed to.