As a result of rapid developments in information and communication technology, digital transformation is becoming more prominent in our everyday lives, improving our social well-being and quality of life, and contributing to organizational efficiency and effectiveness.  Understandably, the rapid pace of digital development often presents a challenge to traditional thinking and practices by industry and government. However, resisting the inevitability of digital development is not the answer. Rather, it is important to capture the benefits that can be gained from innovation, while enhancing digital literacy to ensure that no elements of society feel left behind. Through constructive dialogue, all stakeholders can be empowered with relevant knowledge to dare to dream and take advantage of paradigm shifts. The possibilities of seeing the world differently will be critical for Taiwan society today and in future generations.

The Digital Economy Committee, established last year, represents industry interests in the intersection of digital innovation and economic advancement. Collectively, we contribute broad global insights from having seen how fast-evolving digital economies and data-driven innovations can bring exciting opportunities to society and the economy when supported by receptive government policies.  We look forward to direct and meaningful communications with the Taiwan government to build a digital future together.

Fortunately, the Taiwan government already understands the importance of digital transformation as a way to better its citizens’ lives. The recent response to the COVID-19 outbreak, for example, is a great example of digital tools playing an important role in aiding the community with basic services. This approach was most evident early on with the success of the “Instant Mask Map,” an innovation that has impressed many other countries.

One of the most important pillars behind this success was the role of Minister without Portfolio Audrey Tang, widely known as Taiwan’s “Digital Minister,” in coordinating civic involvement, digital technology, and government data.  But the office of a Minister without Portfolio is not equipped with the personnel and resources needed to support digital transformation during the vital early stages of policy development across various ministries and agencies. As a result, the consistency in policy matters that industry expects in a truly digital-friendly environment has not been achieved. For this reason, the Committee recommended in last year’s White Paper that a high-level authority be established under the Executive Yuan to provide planning and guidance for the transformation to a new economy, and we have been pleased to hear that progress is occurring on that front.

Besides the suggestions presented below, the Committee would like to voice our support for the Telecommunication & Media Committee’s suggestion to maintain a light-touch regulatory environment of OTT TV services. Please refer to the Telecom Committee’s paper for details.

Suggestion 1:  Establish guidelines to encourage government agencies to promote digital approaches.

The Committee was truly excited by President Tsai’s pledge – made during her speech to the Future Tech Exposition (Futex) last December – to set up a dedicated agency to coordinate Taiwan’s digital developments, better manage the digital economy, create reasonable market competition, and allow digitalization to flourish. We look forward to the establishment of this agency and to being able to work closely with it to promote Taiwan’s embracing of the digital age.

Recognizing that the legislative process to create such an agency may take time, we would like to raise some ideas for ways to support digital transformation in the meantime. Such policy stop-gaps could ease the transition, while also relieving certain current tensions in Taiwan regarding the digital economy, especially from international partners.

The OECD’s working paper entitled “Going Digital Integrated Policy Framework” captures key concepts for digital integration and could serve as a useful benchmark for the Taiwan government in examining its policies on digital integration. Important strategic principles, such as having effective coordination, articulating a strategic vision, assessing digital trends and policies, and enabling an inclusive strategy development with international partners are all crucial insights that could inform Taiwan’s consideration of the future digital economy agency.

The Committee cautions against allowing this agency to become just another regulator or competent authority for particular industries. Given its position under the Executive Yuan, the agency should play a major role in coordinating inter-agency dialogue and providing planning and guidance for the transformation to the new economy.

Until a dedicated agency can start operating, we urge the current government ministries and agencies to consider the following recommendations:

1. Set measurable benchmarks to track progress on digital transformation. Each government agency may set periodic short-term goals and assess whether it has hit certain milestones towards digital transformation. This process will help prevent a communication gap from arising between industry and government and will serve to enhance Taiwan’s competitiveness by bringing consistent digitalization results. Both industry and government will benefit from indicators tracking progress in digitization.
2. Require digital literacy training for government officials. Digital literacy is vital for a digital society to thrive. Given the speed of digital innovation today, a concerted effort to understand new digital trends and digital applications is needed across different levels of government administrators and officials.
3. Include a digital impact assessment report for all relevant policies of ministries and agencies, to be shared with industry stakeholders. Whether assessing new policies or amending existing policies, relevant ministries and agencies should include a digital impact assessment report to determine how the policy furthers digitalization goals. We recommend that the report periodically be shared with industry to enhance communication and enable issues to be tackled together as partners. The goal is to ensure that laws and regulations are updated in an accurate and meaningful manner that supports digital development in Taiwan.

Suggestion 2: Help startups and innovative businesses to flourish in Taiwan by building an environment that favors competition, attracts investment, and nurtures talent.

Since taking office in 2016, the Tsai administration has emphasized the need for Taiwan to speed up its digital transformation and build itself into a “startup nation.” The government has undertaken various initiatives to support startups, focusing so far mainly on funding the ecosystem and helping companies kickstart their businesses. While the Committee is pleased to see such government support for local startups, much more needs to be done. We propose prioritizing the following three categories:

1. Deregulation: The Committee appreciates the work of the Regulatory Adjustment Center under the National Development Council (NDC). Moving forward, however, we encourage the government to take an even more proactive approach by reaching out directly to industry stakeholders, studying international best practices, facilitating inter-agency dialogue, and – perhaps most importantly – emphasize deregulation rather than introducing more regulations.
2. Increase public and private investment in startups: For the government alone to invest in startups is insufficient. To catch up with countries like Israel, Estonia, and Singapore, Taiwan needs to set ambitious total investment targets in startups. Steady growth can be expected when the government sets an annual target for start-up investments based on a given percentage of GDP.
3. Attract and nurture talent: Revamp Taiwan’s labor policies, immigration laws, and the University Act to optimize use of the national pool of talent.

We urge the Taiwan government to embrace a long-term mindset with short-term deliverables, bearing in mind that an innovative environment relies on competition, investment, and talent.

Suggestion 3: Commit to multi-stakeholder collaboration to support the news ecosystem and defend against digital disinformation. 

Disinformation is an issue that affects the whole of society. While online intermediaries and platforms play an important role by supporting journalistic quality and countering malicious actors who abuse the internet, collaboration among stakeholders in the news ecosystem is also crucial, particularly for fact-checking and promoting media literacy. While recognizing that free speech has its boundaries – for example when it comes to illegal, harmful, and other sensitive topics such as child abuse – attempts to control, regulate, investigate, or silence the content of communications should in general be viewed as negatively impacting users’ freedom of expression, freedom of association, and the right to privacy.

Over the past few years, members of the digital industry have developed a range of internal policies and usage guidelines to discourage and deal with problematic content appearing on their platforms. In addition, internet companies have increasingly adopted voluntary measures to increase digital and media literacy in Taiwan through partnerships with relevant government ministries and civic organizations. The results are clear. During the past year, Taiwan’s fact-checking organizations have grown and matured into an important ally in fighting disinformation domestically and internationally, as evidenced by their participation in global fact-checking collaborations regarding COVID-19-related news and their efforts during Taiwan’s 2020 Presidential election campaign. This ecosystem has come into being due to an important factor: instead of resorting to legislation, the Taiwan government committed to a non-legislative approach that allows the fact-checking community to operate independently – with an understanding that, in parallel, trusted internet and news businesses will continue to actively pursue sensible solutions to the problem of disinformation.

The government plays a dual role as both rule maker and strategic partner and supporter. In many scenarios, self-regulation with government guidance has proven to be more efficient in facilitating innovation than imposing hasty regulations or restrictions. We ask the Taiwan government to continue to trust and support the resiliency of the current ecosystem that encourages public-private partnerships, promotes a multi-stakeholder approach, protects freedom of expression and due process, and allows international best practice for the industry to be woven into the fabric of Taiwan society, with effective results in practice.

Recommendations:

1. Ensure the integrity of the current ecosystem, keeping it free of censorship and repression. The existing voluntary, censorship-free approach is the collective effort of multiple stakeholders and has been effective. The government should continue to refrain from resorting to coercive and repressive measures that inevitably impinge on free speech. As a free and democratic society, it is important for Taiwan to honor the Manila Principles for Intermediary Liability, a set of guidelines on censorship and take-down regulations that was established by an international consortium of NGOs and is now widely accepted as a global standard. For instance, the second principle states that intermediaries must not be required to restrict content unless an order has been issued by an independent and impartial judicial authority that has determined the material at issue to be unlawful. Among the other principles are the doctrines that content restriction orders must comply with the tests of necessity and proportionality, and that requests for restrictions of content must be clear and follow due process.
2. Give Taiwan a chance to become a regional champion in fighting disinformation. The robust mechanisms that Taiwan’s independent fact-checking organizations have set up to verify news and counter disinformation showed their worth in the past year during a peaceful election period and the transparent and proactive response to the COVID-19 pandemic. Throughout it all, the digital industry has stood up for Taiwan’s democracy by fighting disinformation. This Committee hopes that Taiwan’s will play an important role in the regional fact-checking network, strengthening the role of civil society in Taiwan and across the region under a sensible ecosystem that obviates any need for government intervention.

Suggestion 4: Consider the differing characteristics among digital-services and e-commerce platforms before imposing regulatory obligations.

The advent of the digital economy has transformed our lives and societies at unprecedented speed and scale, sparking immense opportunities as well as challenges. Considering the vital role played by government as policy- and rule-maker to create a stable and secure environment, we greatly appreciate the Taiwan government’s efforts to collaborate with stakeholders to seek appropriate solutions. However, a one-size-fits-all regulatory model cannot accommodate the ever-changing types of digital platforms. We have been concerned by cases in which the government has resorted to legislative action before paying sufficient attention to the complexities involved in the digital economy.

One such example was the recently amended Statute for Prevention and Control of Infectious Animal Disease, where the authority imposed an obligation on all advertisers, e-commerce platforms, and application service businesses to inspect internet content and products that are subject to importation and quarantine controls. While we appreciate the government’s good intentions in seeking to combat the African swine fever virus, the authorities did not distinguish among the various platform before implementing across-the-board regulations.

For example, the Statute holds all advertisers responsible for product inspection, but not all platforms possess the ability to verify that every product meets the quarantine restrictions. The law also requires the posting of excessive warning notices. The amendment was made without consulting with industry, and industry’s feedback after the amendment was made was also ignored. The result was to place an unnecessary burden and impractical compliance responsibility on platforms.

The above is but one recent example of many similar cases. In areas including internet governance and disinformation prevention, the authorities tend to take this one-size-fits-all regulatory model. We remind the authorities of the differences between the role of digital platforms as opposed to actual providers of goods and services. Applying the same regulatory framework to both can only lead to impractical restrictions on platforms, creating difficulties for everyone involved – consumers, platforms, providers of goods and services, and even government agencies. We strongly encourage the Taiwan government to convene multi-stakeholder meetings to provide an opportunity for ample communication before taking regulatory or legislative actions. Such dialogue will also ensure respect for transparency and due process.