Digital Services Act: Industry stakeholders present widely diverging views in DSA consultation

By Francine Cunningham

04-2021

A wide range of industry stakeholders provided feedback to the European Commission’s consultation on its proposed Digital Services Act, which closed on 31 March. Their diverse responses provide some insights into priorities and concerns of different sectors regarding the forthcoming legislation.

To recall, the proposed DSA, which was published in December 2020, is set to usher in a new due diligence regime for online platforms and intermediaries, with mandatory new rules concerning content moderation, take-down of illegal content and products, traceability of online traders and transparency around digital advertising. The proposal is currently under discussion in the European Parliament, where Christel Schaldemose (S&D, Denmark) is preparing a report for the lead Internal Market & Consumer Protection Committee (IMCO). The Industry, Transport and Culture Committees have also nominated MEPs to draft Opinion Reports, which will feed into the main IMCO report.

A quick snapshot of some of the 138 submissions to the feedback consultation on the DSA proposal reveals the following points:

  • Microsoft: The company calls for further differentiation and clarification on services covered. Microsoft believes strongly that the final version of the Act should reflect the extensive variation in online service offerings today, and the corresponding differences in the expectations of users.
  • Verizon Media: The company points to the rapid increase in EU regulation targeting digital businesses in recent years, including P2B, AVMSD, GDPR and now DSA and Digital Markets Act. The cumulative effect of new regulation needs very careful consideration, adding that more regulation will, over time, increase the cost and risk of doing business in the EU.
  • IFPI: The trade association for the recording industry worldwide says that to stop and prevent illegal content online, all digital services must do more. The DSA should, among other measures: apply the appropriate positive obligations to all information society services which enable or facilitate the operation of illegal websites by providing them with services or means to operate; introduce a ‘stay down’ obligation for hosting services; and improve the ‘trusted flaggers’ provisions to provide meaningful benefits to ‘trusted flaggers’.
  • Glassdoor, Inc.: The company, which hosts online company reviews, requests that workplace reviews be specifically carved out or excepted from this draft legislation, as legitimate worker speech and freedom of expression will inevitably be restricted.
  • RELX: The company welcomes the inclusion of a provision ensuring the traceability of traders (“Know Your Business Customer” (KYBC) obligations). However, it is disappointed that these KYBC obligations are only introduced for online marketplaces and believes this is a missed opportunity to address the broad range of illegal content and counterfeit products online.
  • IAB Europe: The association representing the digital marketing and advertising ecosystem believes that it is important for the future regulation to preserve the possibility for users to make informed choices based on information disclosures, rather than taking choices out of their hands.
  • Bertelsmann: The German-headquartered media company said that legislators should consider introducing a fourth category of online intermediaries that curate the content they host based on algorithms. These intermediaries should be subject to a liability regime commensurate with their activity and societal impact.
  • Booking.com: The Dutch online travel agency said that the proposal insufficiently addresses illegal short-term holiday rentals. The powers for national (or local) authorities to order platforms to remove illegal content (Article 8) and to share information (Article 9) are a step in the right direction. However, enforcement loopholes remain.
  • ACT – The App Association: The Digital Services Act should ensure better procedural safeguards for the smallest online platforms. The obligation that platforms of all sizes implement automated notice-and-action mechanisms presents a prohibitive and unnecessary burden for small businesses.
  • DigitalEurope: the trade association representing the digital technology industry strongly believes that important definitions, such as what constitutes a very large online platform, should not be left to delegated acts.

The brief extracts above provide just a flavour of the sheer range of viewpoints on the proposed Digital Services Act which can be read in full here. The multiplicity of topics covered and concerns raised points to the challenges of reaching a political consensus around the new rules.

Next steps

The deadline for tabling amendments to the draft Report on the Digital Services Act by the European Parliament’s Internal Market Committee is 1 July at noon. A vote in this Committee, which is taking the lead on the dossier, is due to take place on 8 November. This will be followed by a vote in the Parliament’s plenary session expected in December 2021.

For further information contact Francine Cunningham

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