Platforms & media
The Digital Services Act (DSA)
What is the purpose of the DSA?
The DSA is an EU Regulation (No. 2022/2065) meaning that it takes direct effect across all EU Member States without the need for national legislative action. The DSA updates the E-Commerce Directive 2000 seeking to tackle the spread of illegal content, improve user safety, promote fair competition, and enhance accountability and transparency. The DSA sits alongside the Digital Markets Act (DMA) which focuses on levelling the playing field and reforming competition law in the digital sphere.
Key provisions
- Illegal content – all in-scope service providers must remove illegal content swiftly and efficiently. The processes services need to put in place to balance the interests of content uploaders and other users depend on the classification of the service provider.
- Transparency reporting – based on the classification of the affected service provider, there are various tiered transparency obligations to report on content moderation and other measures.
- Partial ban on some online advertising – profiling-based online advertising created using sensitive data (such as health data) and aimed at minors is prohibited.
- Ban on dark patterns – online platforms must design and operate online interfaces in a way that avoids 'dark patterns', ie any distortion of users' ability to make informed decisions.
- Trader transparency – online platforms must also conduct due diligence on traders operating on the platform.
- Systemic risk management and crisis response – very large online platforms (VLOPs) and very large online search engines (VLOSEs) have additional extensive obligations to manage systemic risks and, in the event of an extraordinary crisis (a threat to public safety or health in the EU), to co-operate with the EU Commission and take defensive measures in relation to content sharing and moderation.
- Terms of use – services must provide transparent information on any restrictions in their terms affecting the provision of information. This includes policies, procedures, measures and tools used for content moderation, including algorithmic decision-making and human review, as well as the rules of procedure for their internal complaint handling system.
Where will the DSA apply?
The DSA will apply directly in all EU Member States to intermediary services established in the EU and those with a 'substantial connection' to the EU. A substantial connection may be proven through numbers of recipients of the intermediary service in one or more EU Member States in relation to their population; or targeting activities towards one or more EU Member States.
Who will have obligations under the DSA?
- 'Caching’ and ‘mere conduit’ services, such as internet service providers.
- ‘Hosting services’ which means services consisting of the storage of information provided by, and at the request of, a recipient of the service.
- ‘Online platforms’, meaning services that also disseminate information to the public, such as social media and online marketplaces.
- VLOPs and VLOSEs – online platforms and search engines that have an average monthly user base in the EU of 45 million people.
- Non-VLOPs/VLOSEs are exempt if they have under 50 employees and less than EUR10 million in annual sales.
Are there sanctions for non-compliance?
The DSA will be enforced at a national level by newly appointed Digital Services Co-ordinators. VLOPs and VLOSEs will also be regulated by the European Commission. Sanctions of up to 6% of global turnover can be levied for the most serious breaches and impacted individuals can bring civil claims.
Key dates and deadlines
- 25 August 2023 – obligations began for VLOPs and VLOSEs.
- 17 February 2024 – the DSA took effect across the EU for all in-scope organisations.
