Navigating Regulatory Complexity in Tech

Global regulatory intervention disrupts the tech sector in an unprecedented way. The Digital Services Act Package (comprised of the Digital Services Act and Digital Markets Act) is moving into full force and the next wave of regulation, such as the EU AI Act, is already on the horizon. Regulators across the globe have recognized the impact of (big) tech platform companies and technologies on society at large, and, with the European Commission leading the charge, are signalling the start of a new era for tech firms.

Across a wide range of domains touching the core of tech products and services, regulators have shifted from a previously loose stance to a pressing need for stringent control. Chairman of the Dutch Authority for Consumers & Markets, Martijn Snoep, predicts that a regulatory revolution has been initiated that will lead the tech platforms to become equally regulated as financial institutions (Snoep, 2024)[1]. This poses a challenge for tech platforms. They must further mature their organizations to become effective risk and compliance management machines. And while doing so, tech platforms should remain nimble organizations that deliver great user and partner experiences and further improve cost efficiency. This is an unprecedented challenge!

[1] Blog Martijn Snoep: Navigating the Online Platform Regulatory Revolution: Charting a New Course for Regulators - https://www.acm.nl/en/publications/blog-martijn-snoep-navigating-online-platform-regulatory-revolution-charting-new-course-regulators

Tech platforms are now forced to prevent potential harms arising from their products and services on the individual, businesses, and society at large. Successful organizations recognize that they do not need to comply with individual regulations, but that it is the constant stream of new regulations, with overlapping requirements and conflicting priorities, that must be addressed. An effective compliance strategy aims to build an embedded, sustainable, and reusable compliance operation. Also, tech platforms must embrace compliance as part of their internal culture. Not as a barrier to the business, but as an enabler. At the heart of the strategy, however, remains the platform’s relentless focus on maintaining an outstanding user experience that is underpinned by recognition of trust and safety. A tech platform that will thrive can balance compliance with innovation, in a cost-efficient manner.