In a strategy paper published on Thursday, the bloc said:
Social media giants should sign up to a special "Code of Practice on Disinformation" by July. The Code would include criteria for identifying fake news and contain suggested measures to prevent it spreading online.
Suggested measures include: increased scrutiny of advertisement placements and fake accounts, giving users the ability to track where information originated from, telling them how algorithms that spread information work, and steps to stop selling services to groups that want to spread fake news.
After July, the Commission would monitor companies' efforts to put the code into practice and decide in December whether new actions, including regulations, would be needed to effectively fight fake news.
An independent Europe-wide network of fact-checkers would also be set up to identify fake news and best practices for the industry.
From Fake News to forced news. Across the US, local TV news anchors say they were ordered to read from a script meant for Trump TV.
What were the reactions?
A spokeswoman from the Computer and Communications Industry Association (CCIA) said the timeline for the new strategy appeared rushed and that it is "important to recognise that there is no one-size-fits-all solution to address this issue given the diversity of affected services."
European Digital Rights (EDRi) warned the Commission "not to rush into taking binding measures regarding 'fake news' or 'online disinformation' but rather, take the expertise of civil liberties and digital rights experts into account."
EU Security Commissioner Julian King said the move to combat fake news was not a form of censorship: "It's not targeting partisan journalism, freedom of speech, freedom to disagree, freedom to be, in some cases, a bit disagreeable."
Why now? The Commission paper said social media companies "have so far failed to act" on the problem of fake news that EU Security Commissioner Julian King said "poses a serious security threat to our societies." The EU is looking forward to European Parliament elections in May 2019.
Russia's near miss: Commission Vice-President Andrus Ansip told reporters the Commission had thought about explicitly mentioning Russia in its strategy paper. US intelligence agencies accuse Russia of spreading fake news to influence the 2016 presidential election.