Privatisation of the regulatory function, or the dark side of the digital revolution


Institutional Communication Service

30 March 2020

In recent decades, overwhelmed by the fast-paced and unpredictable changes in technology, the challenges of digital transformation, and the overall shift towards a globalised economy, disoriented national legislators have left much scope for self-regulation, especially in the field of digital law. In fact, today many regulations are increasingly established through codes of conduct of trade associations, general conditions of service providers and Internet platforms, and standards developed by standardisation bodies (ISO, for example). But is the "privatisation” of legislation an irreversible phenomenon? Not for Bertil Cottier, Full professor of Communication Law at USI, who in a recent article observes the first signs of States regaining control.

The digital revolution has disrupted the hierarchical model of the legal order, made of the various normative ‘building blocks’ - constitutional, legislative and regulatory – which fit together harmoniously, replacing it with a fragmented, sometimes chaotic model in which various sources of law get entangled or clash in defiance of all logic. There are two main reasons behind this evolution, according to Prof. Cottier. First, the multiplication of the attribution of legislative powers to lower-ranking administrative entities and, second, the rise of a hybrid regulatory system, resulting  from consultation and cooperation between the public and private sectors (administrative contracts) or State validation of private regulations (extension of collective bargaining agreements, approval of self-regulatory instruments, etc.). In other words, we have moved to a model of "regulated self-regulation".

The area most affected by this development is digital law, which in many ways has been left open to regulatory initiatives originating from private sector. Over the years the State has taken a step backwards, paving the way to market players (telecommunications companies, Internet platforms, search engines, and even Wikipedia), faced with the need to regulate their activities and those of their users, but who do not hesitate to establish and impose their own agenda. So much so that the general terms and conditions of contracts for the provision of services, company regulations, codes of conduct of professional associations and ISO standards have become the main part of the legal framework governing cyberspace, generating "a cacophony of standards".

The terms and conditions of online service providers, in particular, are at the top of the legal system of cyberspace; this area is dominated by digital giants such as Facebook (over two billion users) and Google (over 90% of the search engine market). The currently growing use of self-regulation is a response to different and often cumulative needs, such disciplining the community of users, preserving the quality of the services provided, establishing (or at least demonstrating sensitivity to) a certain ethics of online communication, not to forget the pursuit of uniform global enforcement regimes, and/or the attempt to prevent undue State interference.

"The transformation of a user community into an extra-State must be, if not opposed, at least firmly channelled", says Cottier. "Today national governments, in Switzerland for example, are regaining legislative control in some areas but, ironically, instead of resolute intervention through hard law, they are acknowledging soft law texts and embedding them into hard laws. Usually, soft law is supposed to complete hard law principles, now it is the opposite, but still it is an encouraging sign: the State is back!" explains Prof. Cottier.