Digital sector needs to be regulated, says Foreign Minister
Attractiveness – Digital economy – Speech by M. Jean-Marc Ayrault, Minister of Foreign Affairs and International Development, on the occasion of the Soirée numérique
Paris, 22 November 2016
The issue of the digital sector obviously mustn’t be addressed solely from a national policy perspective: it’s an international issue, above all. The digital sector needs to be supported by a strong, coherent foreign policy guided by clear principles and objectives. Indeed, this policy will have to address the crucial challenges dividing those in the digital sector today. There’s debate, and it’s legitimate. It is logical and follows that we should be at the Ministry of Foreign Affairs this evening.
The first of these challenges concerns the digital economy. Its exponential development, fostered in part by a handful of historic, dominant American players, compels the question of its regulation: what rules must we draw up to provide a framework for the digital economy? How do we promote fair competition, allowing everyone to be competitive in their own digital ecosystem? How do we ensure that value created by players in the digital economy avoids today’s widespread aggressive tax optimization practices? How do we ensure that it is fairly distributed? These aren’t new questions; they’ve been raised throughout global economic and social history. But today they’re being raised in relation to the digital sector as well; so we’ve got to address them.
Because the digital sector poses its own challenges: it can’t be grasped in terms of traditional criteria or tools. By developing aggressive optimization policies through the offshoring of its income to Ireland, the Apple group, for example, avoided accountability in other European countries it is based in. That’s a concrete example which illustrates the problem. The European Commission has also severely criticized this practice on the grounds of state aid control, i.e. in the framework of European law. In the same way, it took a long time for the European Commission to denounce Google’s ultra-dominant position in its market and envisage sanctions. Dominant American players’ strategies to circumvent [rules] thus pose a pressing problem for Europe’s economic players and, more broadly, every country. The OECD and the G20 are currently working on these issues.
The second challenge more specifically concerns respect for rights and freedoms in the era of increasing amounts of personal data: how can we safeguard and protect our basic freedoms in a world awash with digital technology? Because it produces, gathers and processes an increasing amount of data, the digital economy poses unprecedented challenges: the right to the protection of personal data, freedom of expression and intellectual property sometimes clash with a digital model based on absolute freedom of movement of data and its use. This model, which makes a high level of personal data protection impossible, is very seriously shaking the confidence of users and their confidence in the security of networks. There are, in particular, lessons to be drawn from the Snowden affair: the monopoly of a state and its digital industry over our data can have a devastating effect on safeguarding our basic freedoms. So it’s necessary to persevere to ensure that our European concept of defending basic freedoms prevails.
Finally, states are facing a third challenge: the increasing number and diversity of cyber threats. The aim of these isn’t just to harm states’ internal security and stability but also international security and stability. From the sabotage of the TV5 Monde television network to piracy and the leaking of the US Democratic committee’s emails, the Internet has become an instrument of coercion and destabilization. It is a tool often used covertly by states, as well as non-state groups. The confirmed threat of espionage and sabotage against our sensitive infrastructure is now combined with an information warfare threat. These threats pose major questions about strategic equilibriums, security approaches and regulatory frameworks. That gives you an idea of the challenge.
Having identified these challenges, it’s important to address them, while avoiding two pitfalls: on the one hand, authoritarian control, and on the other, a laissez-faire policy.
While the digital sector needs to be regulated, the Internet must remain an open, accessible and trustworthy world. We must condemn systems which – on the pretext of regulation and out of a concern to assert their sovereignty – seek total control of networks and impose strong censorship. We must reject these authoritarian visions, which clash with the principle of openness and our most fundamental rights.
On the other hand, we must be vigilant and not promote a laissez-faire policy banning all forms of regulation. The workings of the digital sector cannot be dictated solely by means of technology and the economy or give precedence to the law of the strongest.
For France, the challenge is to help a European model emerge for the Internet and the digital world. I’m convinced that Europe has a system that needs to be asserted, based on values intrinsic to it and a legal tradition and principles enabling the requirements of security, rights protection and guaranteed economic equity to be a reconciled in a balanced way. I’m equally convinced that these principles will enable the Internet and the digital sector to continue developing in a balanced and sustainable way, maintaining the trust and openness which are necessary to it.
The Ministry of Foreign Affairs and International Development is fully involved in the negotiations on Internet governance, particularly within ICANN. In the European Union framework, it’s helping to draw up rules and policies in the economic, rights protection and cyber security fields. In NATO, the Ministry is driving proposals to adapt the Alliance to cyber defence challenges. Finally, at the United Nations it’s playing a role in the emergence of a regulatory framework aimed at guaranteeing international peace and security in cyberspace.
Our global diplomatic network is totally mobilized in support of digital diplomacy. The “Soft Power 30” report drawn up by the consultancy Portland recognized this, placing France in the top rank in terms of influential action. The Foreign Ministry is among those most followed on social networks; this is reassuring. Its French, English and Arabic Facebook accounts have more than 330,000 fans, and its French, English, Arabic and Spanish Twitter accounts have more than a million followers. The Ministry’s website, France Diplomatie, also receives more than 1.7 million visits a month. We communicate daily on the Internet in six languages – French, English, Arabic, Spanish, German and Chinese – and our goal is to increase this number to 10 as early as next year.
Within the Ministry, we’ve sought to strengthen our capabilities, and those of the government, to tackle all these digital challenges more effectively. We’ve enhanced our resources and internal organization: among other things, we’ve appointed an Ambassador for Cyber Diplomacy and the Digital Economy, David Martinon; we’ve allocated to the Deputy Secretary-General, Laurent Garnier, a new portfolio dedicated to coordinating all digital issues; and finally, we’ve substantially increased the resources within the Ministry devoted to cyber security challenges.
We wanted the Ministry of Foreign Affairs and International Development to get involved in this way because we consider it essential to develop an overall vision on digital challenges which does not compartmentalize the challenges but views them comprehensively. We need a French and European vision which is not necessarily aligned with the American vision and which – I repeat this yet again – respects our values and principles (…)./.