EU to tackle online gatekeepers through Digital Services Act and the Digital Markets Act

Digital Services Act package

According to the European Commission, the Digital Services Act package is a modern legal framework which will ensure the safety of users online, and maintain a fair and open online platform environment.

The European Commission has recently announced the intended implementation of two new pieces of legislation . The Digital Services Act (DSA), and the Digital Markets Act (DMA), aim to safeguard the digital space, so that the fundamental rights of all users of digital services are protected, and to level the playing field to cultivate innovation, growth, and competitiveness, in the European Single Market and globally.

The Commission prepared this legislative package after consulting a wide range of stakeholders including inter alia, the private sector, users of digital services, civil society organisations, national authorities, academia, the technical community, international organisations and the general public. Several consultation steps were also carried out to fully capture those stakeholder’s views on various  issues related to digital services and platforms.

Digital Services Act is aimed at ensuring a safe and accountable online environment.

The DSA consists of new rules regarding digital services, placing citizens at the centre,  hope to foster growth, competitiveness, innovation, and an upscaling of smaller platforms. The rules are designed to create transparency and clear accountability for online platforms. They will better protect consumers and their fundamental rights online. Citizens can expect to see more choices, lower prices and greater protection from illegal content. This should also mitigate systemic risks like manipulation and disinformation, while establishing greater democratic control over systemic platforms. 

The Digital Services Act will govern online intermediary services, which millions of Europeans use every day like online marketplaces, social networks, content-sharing platforms, app stores online platforms, hosting services, intermediary services, with special rules expected for large online businesses with a reach of over 10% of the 450 million European consumers. Micro and small companies will have obligations proportionate to their ability and size while ensuring they remain accountable, however, all online intermediaries offering their services in the single market, whether they are established in the EU or outside, will have to comply with these new rules. 

Digital Markets Act is designed to ensure fair and open digital markets.

The DMA targets a very specific group of organisations, deemed “gatekeepers”. The act establishes a set of narrowly defined objective criteria for qualifying a large online platform as a so-called “gatekeeper”, allowing the DMA to specifically target the problem that it aims to tackle as regards large, systemic online platforms. The criteria will include companies with a strong economic position, significant impact on the internal market, a strong intermediation position, durable position in the market, and functioning in multiple EU countries. The “do’s” and “don’ts” for gatekeepers in these new rules must be adhered to in the daily operations of these companies. The Commission will carry out market investigations to ensure these rules keep up with the fast pace of digital markets.

With the establishment of this new set of rules, consumers are expected to have better access to a range of services to choose from, more opportunities to switch their providers, direct access to services, and more reasonable prices. The Act will allow gatekeepers to keep all opportunities to innovate and offer new services, however they will simply not be allowed to gain an undue advantage. The benefit of these rules to innovators and technology start-ups, are new opportunities to compete and innovate in the online platform environment and freedom from having to comply with unfair terms and conditions which limit their development. In general, business users who depend on gatekeepers to offer their services in the single market will benefit from a more equitable business environment.

The new legislative strategies proposed will address several issues across the EU, and are expected to have significant positive impact on fundamental rights online.

The new legislative strategies proposed will be applicable across the EU, and will target the significant gaps and legal burdens that still need to be addressed, despite several targeted, sector-specific interventions at an EU-level. While digital services include a wide range of online services, the rules specified in the Digital Services Act primarily concern online intermediaries and platforms like online marketplaces, social networks, content-sharing platforms, app stores as well as online travel and accommodation platforms. The Commission expects the Digital Services Act package to allow for significant benefits for consumers and innovation which these online platforms provide, to be enjoyed, while curb the issues associated with the accelerating digitalisation of society and economy.

Aphaia are leading experts in EU ICT policy, including telecoms, data protection, and AI.

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