EU Draft Targets Addictive Design and AI Chatbots, Proposes Fines of Up to 6% of Global Revenue

According to ChainCatcher citing Cailian Press, a draft of the Digital Fairness Act would require companies to let users disable features designed to encourage compulsive or excessive use, including AI systems that simulate personal relationships to prolong interactions. The draft, seen by multiple media outlets, is expected to be published on November 11. Violations could incur fines of up to 6% of a company’s annual global revenue. The proposal would let adults turn off autoplay, notifications unrelated to their activity, and streak-based rewards. It also identifies 10 manipulative design practices that would be unfair in all circumstances, including making cancellation harder than sign-up; hiding prices or auto-renewal terms; falsely implying there is no alternative; making misleading claims about scarcity or popularity; repeatedly emphasizing scarcity at checkout; preselecting extra products or quantities; framing refusal as the wrong choice; repeatedly prompting users to reverse a decision; using confusing double negatives; and fabricating notifications that suggest someone has contacted the user. The European Commission could add practices to the list without reopening the legislative process. The draft would also require online subscriptions to offer a clear cancellation button, obtain consumers’ active consent before a free trial becomes paid, and send reminders before automatic renewals. It would ban paid loot boxes and pay-to-win mechanics in video games for minors. An impact assessment estimates the rules could prevent €88.4 billion in consumer losses from 2025 to 2035. Including time saved, annual benefits are estimated at €13.7 billion, while businesses’ combined annual compliance costs are projected at €678 million. The draft must still be reviewed by the European Parliament and member states and, under the current text, would apply 12 months after taking effect. Germany’s government opposed the proposal in mid-last month, arguing that existing consumer-protection directives should be amended instead of creating a new law.