data = open(file, encoding='utf-8').read()

This line of code reads the contents of a file with the specified filename and encoding ('utf-8') and stores it in the 'data' variable. The 'open()' function is used to open the file and the 'read()' method is used to read its contents. The 'encoding' argument is used to specify the character encoding used in the file. In this case, it is set to 'utf-8', which is a common encoding used for text files.