CCMI/216
Initiative on virtual worlds
OPINION
Consultative Commission on Industrial Change
Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions -
An EU initiative on Web 4.0 and virtual worlds: a head start in the next technological transition
(COM(2023) 442 final)
(SWD(2023) 250)
Rapporteur: Andrea MONE
Co-rapporteur: Patrice CHAZERAND
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Referral
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18/08/2023
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Legal basis
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Article 304 of the Treaty on the Functioning of the European Union
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Section responsible
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Consultative Commission on Industrial Change
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Adopted in section
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06/12/2023
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Outcome of vote
(for/against/abstentions)
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33/0/1
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Adopted at plenary
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DD/MM/YYYY
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Plenary session No
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…
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Outcome of vote
(for/against/abstentions)
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…/…/…
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1.Conclusions and recommendations
1.1The European Economic and Social Committee (EESC) supports the Commission's objective of investigating a sector whose benefits and, especially, its risks, still need to be clarified and which will profoundly affect the near future and, above all, future generations. There is therefore an urgent need to examine whether existing legislation is sufficient and adaptable to be able to face this challenge, or whether new legislation is needed.
1.2The EESC supports the four pillars laid out in the Communication. Yet, the social dimension of virtual worlds, crucial for each and every pillar, deserves more attention, especially regarding how virtual worlds impact the working conditions, health and safety of those using or working in them, as well as vulnerable people.
1.3Furthermore, the EESC deems important to:
·foster the development of global industry standards and interoperability protocol standards: all stakeholders should contribute to this vital component of a responsible environment, in a collaborative effort to complement legislation aimed to enable the seamless integration of European businesses and technologies within virtual worlds;
·foster public-private cooperation to grow industrial virtual worlds while ensuring compliance with ethical and regulatory standards;
·fund research and innovation projects dedicated to virtual worlds, with specific support to start-ups and SMEs, as well as new digital literacy programs targeting people, young or adult, and skills development and training initiatives intended to meet the requirements of businesses operating in virtual world environments;
·enforce all relevant existing legislation (such as competition, data protection, intellectual property), as well as further digitalize public administration, and enhance accessibility as preconditions for the sustainable construction of virtual worlds;
·assess concrete measures to develop sustainable virtual worlds, e.g., carbon neutrality criteria for Web 4.0 applications and a Charter of Values alongside the legislative process to keep up with rapid technological change.
2.General comments
2.1The Communication released on 11 July 2023 by the European Commission aims to steer the next technological transition and to ensure an open, secure, trustworthy, fair and inclusive digital environment across four key strategy pillars: people and skills, business, government, and governance.
2.2The EESC welcomes this Communication that reflects the thrust of its opinion on this topic. However, virtual worlds resulting from fast moving technological development hold heavy implications for labour and society, i.e., for the daily life of future generations of Europeans: our virtual environment and its governing rules must be constructed in a responsible manner if the Commission’s aim of ensuring “virtual worlds that reflect EU values and principles and fundamental rights” is to be met.
2.3In depicting Web 4.0 as “a ground-breaking technological transition”, the Commission acknowledges that “the EU has a robust, future-oriented legislative framework that already applies to several aspects of the development of virtual worlds and Web 4.0.”: on the one hand, a definition of it as a variety of technologies powered by data and instrumental to people and business; on the other hand, a wealth of rules (e.g., the GDPR) whose applicability should be checked and its enforcement improved to ensure flawless and balanced data protection. Adjustment may not suffice: for instance, the health and safety provisions of our material world will not suit easily the immersive dimension of virtual worlds; the “Proteus effect” tells that the appearance of the avatar may bleed onto the behaviour of the real person using it. Further legal measures will likely have to be contemplated to ensure that virtual environments are both efficient and safe for businesses and users/workers.
2.4The EESC encourages the EU to keep a momentum, whose success tells of trusted cooperation between government and all stakeholders concerned, and to see that technological progress and creators’ inventiveness will not outrun legislation. To foster socially sustainable virtual worlds, the EESC advocates that a Charter of values be designed and monitored by the Commission, together with Social Partners and Civil Society Organizations, business and academia, in their different and specific roles and functions.
2.5The four pillars laid out in the Communication are much warranted to secure flawless accountability, the cornerstone of effective democratic control. Smooth harmonization across the EU through the continuing involvement of Member States will avoid imbalances and loopholes.
2.6The overall direction taken by the policies listed in the Communication (DSA and DMA in particular) – consistent with the opinions adopted so far by the EESC –, combined with practical experience gained from the achievements and shortcomings of some of them, show that the EU has a real chance to “become a major player in nascent markets related to Web 4.0 and virtual worlds”, provided that we act now: the EESC strongly supports both this legitimate ambition and the suggested pathway, with an eye on international cooperation exemplified by the Global Gateway.
2.7However, the social dimension of virtual worlds is crucial across all pillars: it deserves more attention to increase awareness and integration of the related issues. As highlighted in its exploratory opinion on the initiative on virtual worlds, such as the metaverse, the EESC asserts that virtual worlds will deeply impact the well-being, health and safety of those engaged in, or working within them. It is therefore essential to implement appropriate measures, including social dialogue and collective bargaining, to enhance working conditions, ensure easy access to pertinent information, prioritize worker safety and offer training to develop competencies and skills. More generally, the EU must ensure that established real-world regulations are upheld within those virtual worlds that replicate real-world constraints. Proper regulatory steps should be taken to address the requirements specific to various categories of virtual worlds. A thorough evaluation of existing legislation shall identify areas where current regulations apply to the physical world as well as to the virtual worlds concerned; otherwise, new legal frameworks will be needed.
2.8In line with the opinion on the initiative on virtual worlds, such as the metaverse, the EESC sees two sides in the environmental impact: while energy consumption increases as a function of demand for more computing power and connectivity, unfettered technological progress makes the ICT industry ever more carbon footprint-friendly: proper measurement kits based on agreed international standards will help model and quantify the impact of digital technology on energy consumption in various economic sectors. While statistical sources gain reliability, the Commission could promote carbon neutrality, measured through international standards, by making it a criterion to create Web 4.0 applications in the EU, and provide incentives to reduce the carbon footprint of companies through the use of virtual worlds.
3.Specific comments
3.1People and skills
3.1.1The EESC praises the active steps taken by the Commission to build a talent pool of virtual world specialists. Partnering with the European Institute for Innovation and Technology (EIT) and its Knowledge and Innovation Communities (KICs) should attract leading education institutions, research organizations and businesses keen to boost the EU’s virtual technology capacity. Likewise, multi-stakeholder partnerships have a proven record of delivering results: being promoted by the EU will enhance their performance. Training being a key driver of success in virtual worlds, the EESC calls for more anticipation in both university curricula and upskilling and reskilling in companies and local authorities in order to make Europe self-sufficient in the skillsets needed to remain a global leader. Indeed, ensuring proper appropriation of virtual worlds by European youth should be a critical measure of success.
3.1.2The EESC strongly supports the development of virtual world toolboxes for the general public to improve the accessibility and safety of virtual environments, along the objectives and interests of young people. These toolboxes must be different from those intended for business. Furthermore, binding policies should also be evaluated to achieve the goal of fair and desirable virtual worlds.
3.1.3The EESC observes that the section on “People and skills” does not pay enough attention to the impact on working conditions and to how workers can be involved in improving the use of their own innovations in the workplace. In light of the critical issues of the proposed AI Regulation with regard to the workplace, the EESC emphasizes the need to ensure responsible virtual worlds, focusing on quality jobs, social protection, and workers’ participation, in keepingwith the new social contract underlined in the 2023 Strategic Foresight Report and in the European Pillar of Social Rights. Furthermore, connecting the education and training systems is instrumental to fostering a virtual learning environment that addresses the peculiarities of the different users (targets groups) in a lifelong learning perspective. It is therefore essential that the initiative becomes an integral part of the ongoing revision process of the European Education Area (EEA).
3.1.4Industry and commerce are two fields most concerned by virtual worlds. Sector-specific studies carried out as Web 4.0 is implemented would ensure that employees are properly involved, guaranteeing their rights, scalability and working conditions throughout this transformation. A more horizontal assessment should be conducted in 2-3 years with the help of the CCMI to provide decision makers with a comprehensive, detailed overview of the actual impact on all involved stakeholders, including our global partners.
3.1.5Rising violence, hatred, racism, and discrimination in relation to particular groups of people, from youth to women, need to be taken into account. Inequality induced by the unequal distribution of technologies also calls for remedies. Algorithms are known for replicating their original developer’s biases by adding layers of automated biases that may elude the grasp of their operators themselves (black box): how this heavy load of biases (along with data) will hit various stakeholders should be fully documented. Additionally, the legal status of the virtual twin user/worker, namely the avatar, also needs consideration. The point of whether the avatar should be treated as an autonomous legal entity or, alternatively, as a legal object over which users may claim some sort of rights (e.g., intellectual property) shall be clarified urgently at global level.
3.1.6Ultimately, the application of the law of the place where the work is carried out (where the meta-worker resides, i.e., the lex loci laboris), today’s prevalent criterion for the purposes of identifying the applicable overriding labour protections according to the EU’s Rome I Regulation, would provide the companies operating in virtual worlds with an incentive to select meta-workers from among those who reside in countries where the labour laws are weak(er) or more lenient. The risks of such law-shopping are correctly stressed in the Commission’s Communication (“in the area of employment, there is a risk of attempts to circumvent EU social standards, for instance by imposing lower ones on users of virtual worlds”): they only need to be addressed in an insightful way.
3.1.7Further to the specific role of Social dialogue to be promoted and reinforced, it is crucial to enhance regular Civic Dialogue in all aspects of Web 4.0 and virtual world to increase human-centricity, inclusion, safety, and transparency in which Civic Society Organizations play a key role.
3.2Business
3.2.1The EESC fully supports the urgent development of an industrial and technological roadmap via a new European partnership to be launched in consultation with the Member States. Likewise, the EESC supports listing Web 4.0 and virtual world technologies among the potential beneficiaries of the proposed STEP initiative.
3.2.2The EESC supports cluster-style plans in order to build upon the success of the European Digital Innovation Hubs network by promoting exchanges and training among virtual world hubs. The Virtual and Augmented Reality Industrial Coalition will likely give a practical twist to the progress expected on this front. Virtual worlds offer Europe a pathway to reinforce our leadership in content production and distribution, which implies adequate support for the arts, culture, and entertainment sector, including by strengthening dedicated European programs, such as Creative Europe, Erasmus +, Alliance for Innovation and Invest EU, lest we lose our leadership.
3.2.3The EESC welcomes the virtual migration of well-proven tools such as regulatory sandboxes, an SME-friendly environment based on best practices, co-designing, flawless intellectual property rights enforcement, and open and interoperable standards. Without precise, ongoing monitoring of this migration, not only could the competitiveness of European business suffer, but people's trust in virtual worlds could also be eroded in a major setback. Standards and sandboxes being instrumental to a successful transition, the EESC stresses that they must embed principles of prevention and precaution now typical of a social Europe, and should ensure the involvement of the Social Partners at all times.
3.2.4The EESC strongly supports improved sustainability, a key parameter where Web 4.0 can lead. AI-enabled predictive maintenance is an example of enhancing sustainability, and thus of achieving CSR objectives on a global scale. Virtual worlds, through digital twins, will make it possible to anticipate changes in companies and communities, while involving employees and local residents. On a social level, it means taking better account of each individual’s needs.
3.2.5Effective regulatory frameworks must be enforced to prevent monopolistic practices and ensure fair competition within the virtual world platform landscape. These provisions should also secure robust data protection to safeguard user privacy and security in enhanced digital environments. Proactive regulation will promote a healthy and competitive virtual world ecosystem while upholding the fundamental rights of users.
3.2.6The EESC reiterates the need to address the issues of taxation of activities in the virtual world and the creation of appropriate regulatory mechanisms to ensure fair tax practices, as already stated in the opinion on the initiative on virtual worlds, such as the metaverse, in coordination with the OECD.
3.3Government
3.3.1The EESC commends the Commission on its longstanding efforts to foster the uptake of digital technology in government. In particular, the EESC would like to encourage a flagship project of public interest, the European CitiVerse. This initiative based on Digital Twins could optimise urban management and, as a strongside-effect, help citizens from all walks of life see for themselves what virtual worlds can do to improve their daily lives, thus accelerating the uptake of virtual worlds across Europe.
3.3.2The EESC values the planned launch of the European Digital Infrastructure Consortia (EDIC) to speed up and simplify multi-country collaboration projects aimed at facilitating the joint deployment of virtual solutions. Infrastructures are a precondition for the development of responsible virtual worlds; the EESC promotes all efforts, in particular those made through public investment, to reduce the infrastructures gap among regions.
3.4Governance
3.4.1The EESC agrees with the Commission that the technological shift ahead will be of major magnitude: multi-stakeholder governance and monitoring are crucial to ensuring effective management in the fast-changing environment of virtual worlds. Accountability, inclusiveness, and governance shaped by society and centred around human interests must be the drivers of this "participatory governance", the cornerstone of democratic control. The Social Partners in particular have a major role to play in anticipating changes, applying innovations within the labour market, and addressing imbalances that may arise. Rekindling the Social Dialogue, and involving Civil Society Organizations. may prove most effective to raise European citizens' awareness regarding the potential benefits stemming from the agile use of Web 4.0 in health, public services, climate change, and other dimensions of data-driven societies.
3.4.2Given the countless ongoing challenges, the EESC considers it crucial to urgently bolster further research in this area – starting with the many opportunities offered by Horizon Europe – in order to raise awareness, address the various prejudices in a well-reasoned manner, and make the rise of Web 4.0 fully compliant with anthropocentric principles, in order to develop and not endanger the human species. Best practices must be promoted by the Commission and deployed throughout Europe, such as respect for the values to be shaped around Web 4.0.
Brussels, 6 December 2023.
Pietro Francesco De Lotto
President of the Consultative Commission on Industrial Change
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