Like the TPM & Microsoft scare when TPM first started arriving in hardware, and we all thought it would be used to lock out other OSes. Only it's for real this time.
I don't know if this is possible so easily. Does the OS scan the memory of all applications? How does it know what is text and image data?
What if it is encryped or even just obfuscated? Does the OS then track all changes of memory etc?
Or you think it'll just have a rolling keylogger so you can't type in s.th. malicious?
Nothing. That is, nothing until your application becomes popular. I will keep encrypting my emails and they can pound sand once legislation for this makes it to my country. It should be a while before these shenanigans are in every distribution or kernel for Linux.
They want to change the public perception from "Private encrypted communication is good and desirable" to "Encrypted is unsafe. Encrypted could be scary. Encrypted enables Bad People."
In a vain attempt to inhibit access to non-broken cryptography, we will probably see operating systems that allow actual root access to the user -- or even just allowing non-manufacturer-signed executables to run! -- being painted as "unsafe platforms." Apple has already transitioned most of the way to being fully in the "trusted computing" camp, since it takes a great deal of gymnastics to even modify the OS because of the Mac's sealed system volume, and out of the box all executables must be blessed by Apple, meaning governments can put their thumb on Apple to force them to disallow any non-broken crypto tools from being used. I know this can be changed in Settings for now, but that'll probably go away eventually.
Microsoft will be next of course, and Linux will be portrayed as a "hacking tool" by contrast to the commercial OSs.
The same mechanisms that prevent you from breaking law at home, commiting fraud, hurting people, etc. will be used if this law passes. Nothing more, nothing less.
Technocrat delusions on how you'll fight the government with open source are just that. Delusions. They have a wrench and guns.