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Google, Facebook and Others in the Crosshairs as EU Cracks Down on Copyright

The EU crackdown against Big Tech continues.

Less than a year after the enactment of GDPR rules that govern companies’ use of customer information, European regulators are pushing for stricter oversight of copyright rules.

On Tuesday, the European Parliament adopted a tougher copyright law that could hit tech firms like Alphabet (GOOGL) and Facebook (FB) that aggregate content on various platforms. Under the law, tech firms must sign new licensing agreements with publishers or creators whose work they publish. It’s aimed at compelling companies to move more aggressively to take down unlicensed material from their platforms.

The directive, which followed a years-long lobbying effort by the music industry and other publishers, is due to become law in individual member states two years from now. The law would hold companies that operate platforms, such as Alphabet’s Google News or YouTube, liable for copyrighted material that gets uploaded, and allow rights holders to seek penalties.

Court battles are likely, and opponents say that the law could lead to unintended consequences and place undue burdens on companies.

“The Copyright Directive is improved but will still lead to legal uncertainty and will hurt Europe’s creative and digital economies,” a Google spokesperson wrote in a statement to TheStreet. “The details matter, and we look forward to working with policy makers, publishers, creators and rights holders as EU member states move to implement these new rules.”

The directive doesn’t contain any specific mandates about the size of penalties for violating the law. But it could be a sign of more headaches — and costs — ahead as regulators in Europe and elsewhere take a harder look at tech behemoths.

The EU has been ratcheting up oversight powerful tech firms, notably with GDPR, and more recently, “digital tax” proposals targeting tech multinationals. In January, a French regulator slapped Google with a $57 million fine for GDPR violations, and privacy experts anticipate more penalties to come in Europe and elsewhere. And EU antitrust regulators have levied fines against Google totaling more than $9 billion for alleged anti-competitive practices.

In the U.S., the FTC is reportedly negotiating a fine of Facebook for the Cambridge Analytica data-sharing issues that could total $4 billion or more.

Alphabet shares were down 1.4% to $1,173.42 on Wednesday, while Facebook shares were down 1.0% to $165.97.