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DIGITAL EUROPE

DSA - Digital Services Act

This Regulation will apply from 17 February 2024

The Digital Services Act (DSA) is a ​EU Regulation aiming at updating the rules governing online platforms and services in Europe. There are new obligations for online platforms to tackle illegal content, increase transparency around content moderation, and provide redress mechanisms for users.

The act also introduces a new regulatory framework for online advertising. The DSA seeks to promote a safer and more transparent online environment while balancing the interests of platform providers, users, and society at large.

Under the DSA, large online platforms have to follow a set of strict rules, including taking steps to prevent the spread of illegal content, removing harmful content promptly, providing greater transparency around content moderation decisions, and implementing effective complaint mechanisms. The act asks for measures to increase the accountability of online platforms and ensure a level playing field for businesses in the digital economy. 

DSA includes due-diligence obligations for certain intermediary services, notice-and-action procedures for illegal content, and the ability to challenge content moderation decisions. It seeks to improve users' safety online across the Union and protect their fundamental rights.

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DSA also sets a higher standard of transparency and accountability for very large online platforms, with obligations to assess the risks their systems pose and develop appropriate risk management tools. The operational threshold for service providers in scope of these obligations is those with a significant reach in the Union, currently estimated to be over 45 million recipients of the service. The Digital Services Act also includes a co-regulatory backstop, building on existing voluntary initiatives.

The proposal maintains the liability rules for providers of intermediary services set out in the e-Commerce Directive but clarifies certain aspects to eliminate existing disincentives and provide greater legal certainty. It also aims to enhance cooperation among Member States to ensure effective oversight and enforcement of the new rules.

Who are the Very Large "Online Platforms" and "Search Engines"?

The DSA Regulation outlines the criteria and process for designating online platforms and search engines as "very large" and subject to additional obligations and responsibilities.

The criteria is based on having an average monthly active user base of 45 million or more in the EU. The Commission may adjust this number to reflect changes in the EU's population. The Commission will designate online platforms and search engines as "very large" based on data reported by the provider or other available information, and will notify the provider, the Board, and the Digital Services Coordinator of establishment.

The list of designated "very large" platforms and search engines will be published in the Official Journal of the EU. The obligations set out in this section will apply to designated platforms and search engines from four months after notification.

This list was released on 25 April 2023:

​Very Large Online Platforms (VLOP's):
- Alibaba AliExpress
- Amazon Store
- Apple AppStore
- Booking.com
- Facebook
- Google Play
- Google Maps
- Google Shopping
- Instagram
- LinkedIn
- Pinterest
- Snapchat
- TikTok
- Twitter
- Wikipedia
- YouTube
- Zalando

Very Large Online Search Engines (VLOSE's):
- Bing
- Google Search

Obligations for VLOP's

VLOP's are subject to certain obligations, including:

1. Transparency requirements: VLOPs must provide clear and understandable information to users on the terms and conditions of their services, including on the data they collect, how it is used, and how users can control their data.

2. Content moderation: VLOPs must take measures to prevent the dissemination of illegal content, including hate speech, terrorist content, and child sexual abuse material. They must also provide users with clear and effective mechanisms to report illegal content.

3. Cooperation with authorities: VLOPs must cooperate with national authorities, including law enforcement agencies, in their efforts to combat illegal activities online.

4. Advertising transparency: VLOPs must ensure transparency in advertising, including providing users with clear information on who is behind advertisements and how they are being targeted.

5. Accountability and liability: VLOPs must take measures to prevent their services from being used to commit illegal activities. They may also be held liable for the illegal activities of their users if they fail to take adequate measures to prevent such activities.

These obligations are designed to ensure that VLOPs operate in a responsible and accountable manner, while also protecting the rights and interests of their users and society as a whole. ​ The full text of the regulation contains more detailed information on these and other requirements that apply to all types of online platforms and services.

Obligations for VLOSE's

​The Digital Services Act (DSA) imposes certain obligations on very large online search engines, which are defined as search engines that have an average number of monthly active users in the European Union (EU) of at least 45 million. Some of the obligations for very large online search engines under the DSA include:

1. Transparency: Very large online search engines must provide clear and easily accessible information to users on the ranking criteria used to display search results. They must also provide information on how they process personal data in relation to search activities.
2. Notice and action mechanism: Very large online search engines must establish and maintain a notice and action mechanism that allows users to report illegal content that appears in search results. The search engine must then take appropriate action to remove or disable access to the reported content.
3. Cooperation with authorities: Very large online search engines must cooperate with competent authorities in the EU in their efforts to enforce laws and regulations related to illegal content. They must also provide support to these authorities in investigations related to illegal content.
4. Transparency reports: Very large online search engines must publish annual transparency reports that provide information on their efforts to address illegal content on their platform, including the number and types of notices received and the actions taken in response.
5. Account suspension: Very large online search engines must have clear and transparent policies for suspending or terminating user accounts that repeatedly violate their terms of service or engage in illegal activity.

These are some of the obligations that apply specifically to very large online search engines under the DSA. The full text of the regulation contains more detailed information on these and other requirements that apply to all types of online platforms and services.

Benefits of DSA

The Digital Services Act (DSA) aims to create a safer and more trustworthy online environment for consumers, businesses, and society as a whole. Here are some potential benefits of the DSA:
​

1. Increased user safety: The DSA requires online platforms to take measures to prevent illegal content, such as hate speech, terrorist content, and counterfeit products, from being distributed on their platforms. This will help to create a safer online environment for users.
2. Improved transparency: The DSA requires online platforms to be more transparent about how they moderate content and how they use personal data. This will help users to understand how their data is being used and to make more informed choices about what they share online.
3. Fair competition: The DSA aims to prevent online platforms from using their dominant market positions to unfairly advantage themselves or disadvantage competitors. This will create a more level playing field for businesses and promote fair competition.
4. Accountability: The DSA introduces new obligations for online platforms, including the appointment of a compliance officer and the establishment of a complaint mechanism. This will improve the accountability of online platforms and give users and businesses more recourse when things go wrong.

Sanctions

The Digital Services Act (DSA) sets out a range of sanctions that can be imposed on online platforms that fail to comply with its provisions. These sanctions are designed to be effective, proportionate and dissuasive.

The DSA empowers national authorities to impose a range of sanctions, including fines, periodic penalty payments, and orders to cease infringing activities. For serious breaches of the rules, the DSA also allows for the possibility of structural remedies, such as the divestment of certain businesses or assets.

In addition to these traditional sanctions, the DSA also introduces the possibility of interoperability remedies, which require gatekeeper platforms to open up their systems to competitors. This is designed to promote competition in the digital market and give consumers more choice.

The DSA also includes provisions for the liability of individuals, including senior management, for breaches of the rules. This means that individuals can be held personally liable for breaches, in addition to the company as a whole.

Notes

> This Regulation amended Directive 2000/31/EC, on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market ('Directive on electronic commerce').

> This Regulation amended Directive (EU) 2020/1828 on representative actions for the protection of the collective interests of consumers.

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