The mountain of European regulation of large platforms has two sides. The first is the Digital Markets Act (DMA), or digital markets legislation, which was agreed at the end of March, with implementation expected early next year.
The other side, which the European institutions have just climbed, is the Digital Services Act (DSA), in other words the legislation on digital services. An agreement was indeed reached overnight from Friday to Saturday, after a final trilogue between the Commission, Parliament and the Council.
If the DMA sets new rules to regulate the practices of access controllers – which will profoundly upset the economic model of the App Store and the iPhone – the DSA sets the responsibilities of platforms on issues of misinformation and of manipulation by forcing them to play the game of transparency and democratic control.
In detail, mechanisms for removing illegal content will be put in place: consumers will be able to report this type of content more easily. After reporting, platforms should quickly remove illegal products, services and content. Consumers will also be able to challenge platform moderation decisions. The latter will also have to be transparent about the algorithms used for their recommendations.
The DSA also contains a provision aimed at improving the traceability of sellers on marketplaces, the objective being to identify those who sell illicit goods. Finally, the text creates a new European committee for digital services, a control structure for ” address the complexity of the online space “.
In summary, the DSA aims to strengthen user control and public power over platforms for content published online. Thierry Breton, the European Commissioner for the Internal Market, explained during the presentation of the text, in December 2020, that “ what is prohibited in the real world is also prohibited in the virtual world », or (non-exhaustive list) hate speech, child pornography, but also the sale of counterfeit products.
Who is concerned ?
This legislation will apply to the very large online platforms which reach more than 10% of the 450 million consumers in Europe, and which present risks of the dissemination of illegal content or which may constitute ” societal damage “. We can think of Facebook and probably Twitter.
These very large platforms have stricter obligations, in proportion to the societal risks they pose by disseminating hateful content or misinformation. Audits will take place every year. They must also offer a content display option that is not based on the user’s profile.
Online platforms that bring together sellers and consumers are also in the target: Amazon of course, but also application stores, social networking platforms and those of the collaborative economy. It will be necessary to see what the DSA can concretely change for the App Store and the Play Store, for example for the hunting of illegal content, the obligations of withdrawal as well as transparency on the algorithms.
Platforms should make unsubscribing procedures as simple as subscribing. Interface manipulations (“dark patterns”) are also prohibited: companies must not promote their services over those of competitors.
Online and cloud hosting services are also affected, as are “intermediary services” that provide network infrastructure, in other words internet service providers and domain name registrars.
Like the DMA, whose fines are particularly high (10% of global annual turnover), the sanctions against companies that do not comply with the rules of the DSA are high. They can indeed represent up to 6% of annual revenues, which can amount to 26 billion euros for Amazon, or even 14 billion for Google!
This agreement is not the epilogue of the DSA. The text now needs to be reviewed by lawyers and properly translated into EU languages. Then Parliament and Council will give the green light. The DSA will be active 20 days after its publication in the Official Journal of the EU, but the rules themselves will not be implemented for 15 months.
A delegation from the Internal Market Committee will travel to Silicon Valley May 23-27 to visit Meta, Google, Apple and others to discuss the DSA and other provisions enshrined in the DMA.