Social Media Economics in Commercial Law: Regulatory Frameworks, Liability Architectures, and Algorithmic Governance in Multisided Digital Markets

Ashraf M. A. Elfakharani

Taif University, Saudi Arabia

This article conducts a comprehensive legal-economic analysis of social media platforms as algorithmic market-makers in commercial ecosystems. Through doctrinal examination of 127 landmark cases across 18 jurisdictions. My findings suggest jurisdictional fragmentation in liability standards. Crucially, I identify three doctrinal fault lines: the algorithmic publisher-tool dichotomy (Gonzalez v. Google LLC, 2023), transparency-trade secret conflict (MLex v. Meta Platforms Inc., 2024), and regulatory objective misalignment (General Data Protection Regulation [GDPR], 2016 vs. Digital Markets Act [DMA], 2022). The article proposes a tripartite regulatory framework featuring: (1) a functional liability test based on economic integration intensity; (2) dynamic risk allocation through graduated due diligence; and (3) mandatory interoperability under FRAND terms. This approach resolves the central problem of platforms' hybrid status as both market participants and infrastructure architects while preventing regulatory arbitrage. The study concludes that commercial law must evolve beyond conduit-publisher binaries to address algorithmic market-making's distinctive externalities

Article link: https://www.asianinstituteofresearch.org/lhqrarchives/social-media-economics-in-commercial-law%3A-regulatory-frameworks%2C-liability-architectures%2C-and-algorithmic-governance-in-multisided-digital-markets