The Year of the DSA – Twelve quick bites of wisdom on the EU’s Digital Services Act

The EU Digital Services Act („DSA“) will enter into full force on 17 February 2024. If you don’t already know what that means, you should at least be aware of the following:

1. Framework

The DSA creates a general legal framework for online intermediary services in the EU – that includes hosting services and online platforms. This framework is to be further specified by more specific provisions such as in the proposed Regulation laying down rules to prevent and combat child sexual abuse (CSAM Regulation).

2. Timeline

The DSA is fully applicable as of 17 February 2024. Non-compliance may result in fines of up to six percent of the group’s annual turnover.

3. Intermediary services

Only services offered as an intermediary service fall under the DSA (which on the one hand entails liability privileges, but on the other hand obliges the service providers to follow new due diligence obligations). Intermediary services include hosting services and online platforms.

4. Liability privileges

The DSA retains the liability privileges for intermediary services introduced by its predecessor, the e-Commerce Directive. Intermediary services do not have a general monitoring obligation for third-party content under the DSA. (But the DSA does not overrule the ECJ case-law on liability for copyright infringements.)

5. Assessment

The due diligence obligations depend on the type of intermediary service that is offered. The DSA distinguishes between “mere conduit”, “caching”, and “hosting” services. Online platforms are a new subcategory of hosting services with plenty of additional obligations.

6. Point of Contact

Intermediary services have to designate a point of contact for matters about DSA compliance and make its contact information easily accessible.

7. Terms and Conditions

The DSA imposes minimum specifications in general terms and conditions as to how the intermediary service provider moderates third-party content. The provisions must be transparent and easy to understand. Graphic elements such as icons can be used in addition to design user-friendly provisions.

8. Transparency reports

Providers of intermediary services must publish transparency reports at least once a year. The report must contain information on any content moderation as defined in the DSA during the relevant period.

9. Notice and Action Mechanism

If you provide a hosting service, you are obliged to implement a notice and action mechanism for illegal content. No such information is necessarily required for content that is (only) against your terms, but not illegal. Users affected by restrictions must receive a clear and specific statement of reasons.

10. No targeted advertising of minors based on profiling

The Digital Services Act prohibits online platforms the targeted advertising of minors based on profiling. In addition, it bans targeted advertising based on profiling using special categories of personal data, such as sexual orientation or religion.

11. Know your business customer

Marketplaces allowing consumers to buy online must obtain certain information to trace the trader and verify such information. The platform must be designed in a way that traders can comply with their information obligations (e.g., the extensive list of obligations in the Consumer Rights Directive).

12. Specific obligations for very large online services

Online platforms with more than 45 million monthly active users within the European Union can (and likely will) be designated by the Commission as a very large online platform (VLOP). So far, the following services have been designated as VLOPS: Alibaba AliExpress, Amazon Store, Apple AppStore, Booking.com, Facebook, Google Play, Google Maps, Google Shopping, Instagram, LinkedIn, Pinterest, Pornhub, Snapchat, Stripchat, TikTok, Twitter, Wikipedia, XVideos, Youtube, Zalando). Amazon and Zalando have taken legal action against this designation.

This is just a non-exhaustive list and we are aware that there is much more to chew regarding the Digital Services Act. In case you need any further bites, we’ll be happy to discuss these (perhaps with a strong coffee).

Dr Andreas Lober
Daniel Trunk