Online Harms Bill: Legislation will disproportionately hit small UK businesses

• Bill is set to have major impact on retailers and ecommerce sites
• Companies could be overcautious in removing content to avoid major fines

Broad and far-reaching legislation to tackle online harms could place a major burden on companies, particularly small businesses, says RPC, the international law firm.

The Government’s Online Harms Bill, published in March, seeks to address illegal and harmful content on the Internet with the aim of safeguarding UK citizens online.

Companies that don’t comply with the legislation can be fined up to £18m or 10% of their global revenue, whichever is higher. There is no limit on turnover for companies under the legislation.

While the Government has said that less than 5% of all UK businesses will fall under the Bill, a far higher percentage of retailers and ecommerce sites are likely to be affected – as well as the social media platforms the legislation was originally designed for.

RPC says the Bill raises several problems that need to be addressed. This includes: 

• Smaller companies being forced to recruit extra staff to monitor content posted on their sites, burdening them with significant additional costs and therefore restricting new entrants to the social media market
• Social media companies being overly cautious in removing content to avoid the risk of huge fines, severely impacting freedom of speech
• Social media firms being forced to remove historic content which falls under the scope of the Bill – a major practical problem given the vast amount of content generated on social media in the past 15 years
• News and entertainment publications deciding they need to switch off their online comments section to avoid the risk of fines, again curtailing freedom of expression
• The unprecedented and contradictory situation of content becoming “illegal” online while the same content is legal in a newspaper, magazine or book

Rupert Cowper-Coles, Partner at RPC, says: “The UK is going to be the first liberal democracy to have this kind of legislation. While the legislation is well intended, it is going to have a lot of negative impacts.

“This legislation will frighten small businesses to either hire moderators they cannot afford or risk a devastating fine.

“The Government and Ofcom have said they don’t wish to impose disproportionate burdens on small companies, but the legislation as it stands will do just that.”

RPC says there appears to be a lack of acceptance among some politicians that social media companies already place great focus on protecting their users from online harm. For example, major social media companies employ over 60,000 moderators to review potentially illegal and harmful content already*.

Rupert Cowper-Coles says: “This Bill will have a chilling effect on people’s ability to discuss matters freely online. Knowing they could be fined 10% of their global turnover, social media firms will be very quick to remove content they think could potentially break the law. Don’t be surprised if the deletion of content goes much further than the legislation intended.

“While measures taken to protect online users – particularly children – are very welcome, this can be done without legislation that disproportionately impacts small companies and threatens individuals’ freedom of expression.”

*Source: Meta, TikTok, NYU Stern, ‘Who Moderates the Social Media Giants’, June 2020.