Technocolonialism – but in Reverse

Episode 470 of the Cyberlaw Podcast

The Cyberlaw Podcast is back from August hiatus, and the theme of our first episode is how other countries are using the global success of U.S. technology to impose their priorities on the U.S. Our best evidence is the EU's Digital Services Act, which took effect last month.

Michael Ellis spells out a few of the Act's sweeping changes in how U.S. tech companies must operate – nominally in Europe but as a practical matter in the U.S. as well. The largest social media platforms will be heavily regulated, with restrictions on their content curation algorithms and a requirement that they promote government content when governments declare a crisis. Other social media will also be subject to heavy content regulation, such as a transparency mandate for decisions to demote or ban content and a requirement that they respond promptly to takedown requests from "trusted flaggers" of Bad Speech. Searching for a silver lining, I point out that many of the transparency and due process requirements are things that Texas and Florida have advocated over the objections of Silicon Valley companies. Compliance with the EU Act will undercut the Big Tech claims likely to be made in the Supreme Court this Term,  particularly that such transparency isn't possible.

Cristin Flynn Goodwin and I note that China's on-again off-again regulatory enthusiasm is off again. Chinese officials are doing their best to ease Western firms' concerns about China's new data security law requirements. Even more remarkable, China's AI regulatory framework was watered down in August, moving away from the EU model and toward a U.S./U.K. ethical/voluntary approach. For now.

Cristin also brings us up to speed on the SEC's rule on breach notification. The short version: The rule will make sense to anyone who's ever stopped putting out a kitchen fire to call their insurer to let them know a claim may be coming.

Nick Weaver brings us up to date on cryptocurrency and the law. Short version: Cryptocurrency had one victory, which it probably deserved, in the Grayscale case, and a series of devastating losses over Tornado Cash, as a court rejected Tornado Cash's claim that its coders and lawyers had found a hole in Treasury's Office of Foreign Assets Control ("OFAC") regime, and the Justice Department indicted the prime movers in Tornado Cash for conspiracy to launder North Korea's stolen loot. Here's Nick's view in print.

Just to show that the EU isn't the only jurisdiction that can use the global reach of U.S. tech to undermine U.S. tech policy, China managed to kill Intel's acquisition of Tower Semiconductor by slowrolling its competition authority's review of the deal. I see an eerie parallel between the Chinese aspirations of federal antitrust enforcers and those of the Christian missionaries we sent to China in the 1920s.

Michael and I discuss the belated leak of the national security negotiations between CFIUS and TikTok. After touching on substance (there were no real surprises in the draft), we turn to the more interesting questions of who leaked it and whether the effort to curb TikTok is dead.

Nick and I explore the remarkable impact of the war in Ukraine on drone technology. It may change the course of war in Ukraine (or, indeed, a war over Taiwan), Nick thinks, but it also means that Joe Biden may be the last President to walk in sunshine while in office. (And if you've got space in D.C. and want to hear Nick's provocative thoughts on the topic, he will be in town next week, and eager to give his academic talk: "Dr. Strangedrone, or How I Learned to Stop Worrying and Love the Slaughterbots".)

Cristin, Michael and I dig into another August policy initiative, the outbound investment review executive order. Given its long delays and halting rollout, I suggest that the Treasury's Advance Notice of Proposed Rulemaking (ANPRM) on the topic should really be seen as an Ambivalent Notice of Proposed Rulemaking.

Finally, I suggest that autonomous vehicles may finally have turned the corner to success and rollout, now that they're being used as moving hookup pads  and (perhaps not coincidentally) being approved to offer 24/7 robotaxi service in San Francisco. Nick's not ready to agree, but we do find common ground in criticizing a study claiming bias in the way autonomous vehicles identify pedestrians.

Download 470th Episode (mp3)

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