The European Commission recently announced that parliament and member states had reached a “swift political agreement” on the proposed Digital Services Act (DSA).
The DSA aims to protect internet users by establishing an “unprecedented new standard” for online platforms that will hold companies such as Google, Meta (Facebook) and Twitter accountable for illegal and harmful content.
More importantly, the DSA will force online platforms to share how their algorithms work, develop processes to quickly remove illegal goods and content, and crack down on users who spread misinformation.
What is the Digital Services Act, when does it go into effect, and what does it mean for platforms and those who use them, including digital marketers?
Here’s what you need to know about DSA right now.
1. What is the Digital Services Act?
Currently, DSA is a proposed piece of legislation first introduced by the European Commission on 15 December 2020.
This proposal comes with two related proposals.in there first announcementthe committee stated:
“The European Commission is proposing today an ambitious reform of the digital space, with a comprehensive new set of rules for all digital services, including social media, online marketplaces and other online platforms operating in the EU: Digital Services Act and digital market law. “
The Digital Markets Act, which aims to ensure a level playing field among businesses, came into effect in March.
According to the European Commission, overall Goals of DSAon the other hand, is:
- Better protection of consumers and their fundamental rights online.
- Build strong transparency and a clear accountability framework for online platforms.
- Promote innovation, growth and competitiveness within a single market.
In short, the new legislation would make search engines, social media networks and marketplaces responsible for regulating content on their sites.
2. When does DSA take effect?
As of publication, the European Parliament and EU member states have agreed to move forward with the proposal.
Now, it needs to be reviewed by two co-legislators.
According to a media report on April 23,
“Once passed, the DSA will apply directly across the EU and will apply 15 months after entry into force or from 1 January 2024, whichever is later.”
Online platforms and search engines classified as ‘very large’ (with 45 million or more users in the EU) will be subject to DSA provisions sooner four months after their designation.
3. Which online platforms are subject to compliance?
The legislation defines digital services as “a broad category of online services ranging from simple websites to Internet infrastructure services and online platforms.”
All digital services operating in the EU are subject to DSA, regardless of where the business is established – even small and micro companies (although regulations are tailored to size).
Small and medium digital services, which account for 90% of affected businesses in the EU, will be exempt from the most costly regulations.
Types of digital services subject to this legislation include:
- online marketplace
- Social network
- Content sharing platform
- app Store
- Online travel platform
- Accommodation platform
- Intermediary services such as Internet providers and domain name registrars
- Cloud and web hosting services
- Collaborative Economic Platform
DSA also applies to “gatekeeper” platforms, defined as Those that “play a systemic role in the internal market and act as a bottleneck between businesses and consumers for vital digital services”.
Platforms with 45 million or more users in the EU (classified as “very large” users) will also need to assess the risks their systems pose to the public interest, fundamental rights, public health and safety.
These platforms must demonstrate that they are using appropriate risk management tools and taking steps to protect the integrity of their services and prevent manipulation by bad actors.
Google currently has 92.04% The search engine market share in the EU will be subject to the highest level of regulation.
with it 309 million daily active users In Europe, Facebook is also known as “very big” in terms of DSA.
Other platforms and social networks benchmarked with more than 45 million EU users include:
- Tik Tok
- apple
- Spotify
- Microsoft
- Amazon
Documents released to the European Enterprise Observatory (CEO) and Global Witness as a result of Freedom of Information requests to the European Commission and the Swedish government show that at every stage of the DSA, from committee to council and parliament, big tech companies have engaged in significant lobby.
“New self-proclaimed lobbying figures show that Google, Facebook, Apple, Amazon and Microsoft have all increased spending on EU lobbying during this period,” CEO report.
“Added together, big tech companies spent more than 27 million euros in just one year. All five companies raised their budgets, but by far the biggest increase was Apple, which nearly doubled its lobbying spending,” they said. added.
Surveillance advertising, user tracking and behavioral targeting are reportedly the most controversial issues.
4. OK, but what is DSA actually Do?
The Commission noted that the Digital Services Act will:
“…developing horizontal rules to ensure accountability, transparency and public scrutiny of the information space around how online platforms shape how our society thrives.”
At the heart of DSA is a regulatory framework that will revolve around how platforms:
- moderate content,
- advertise,
- and use an algorithmic process.
The last point can become very inconvenient for major search engines (eg social/advertising platforms like Google and Meta) as they have to explain to users how their algorithms work.
According to the DSA, digital services face hefty fines for non-compliance – up to 6% of their annual turnover.
5. What does a digital services company need to do?
The obligations of intermediary services such as IP and domain name registrars include:
- Transparency Report
- Terms of Service requirements with due regard to fundamental rights
- Cooperation with national authorities
- Contact point and, if necessary, legal representative
The hosting service is obliged to comply with the above, as well as “Notices, Actions and Obligations to Provide Information to Users” and to report criminal offences to the authorities.
Regulations have become more onerous for online platforms, which must comply with the above-mentioned obligations, which also include:
- Complaints and redress mechanisms and out-of-court dispute resolution
- trusted whistleblower
- Actions Against Abuse Notices and Counter-Notifications
- Transparency in recommender systems
- User-facing online advertising transparency
In addition, regulations prohibit online platforms from targeting ads to children and for targeting based on specific characteristics of users.
The marketplace has special obligations, including reviewing third-party vendors for certification and design compliance. They undergo random inspections.
Very large online platforms – Meta, Google, etc. – Must comply with all of the above and be responsible for:
- Risk Management Obligations and Crisis Response
- External and independent audits, internal compliance functions and public accountability
- User opt-out of analytics-based recommendations
- Share data with authorities and researchers
- code of conduct
- Crisis Response Cooperation
6. So is this about algorithms?
One of the effects of stronger public scrutiny of online platforms covering more than 10% of the EU population (about 45 million people) is:
“…transparency measures for online platforms on various issues, including the algorithm used Seek advice. “
Another section states that DSA will ensure that researchers have access to key data from the largest search engines to inform their understanding of how online risks are evolving.
According to official documents, the state is the DSA’s first line of defense, and enforcement rests with the committee.
7. What does this mean for online advertising?
The committee reports that gatekeeping of large online platforms has become problematic as it hinders competition and disadvantaged SMEs and start-ups.
Small businesses and organizations rely on large platforms to moderate communications and content rankings.
Because gatekeeper platforms like Google and Facebook hold the key to accessing the consumer data generated by these activities, SMEs and startups will end up in direct competition with gatekeepers who use their data for their own benefit (such as targeting Target sells back to those very SMEs).
DSA will partially level the playing field by making the inner workings of advertising and ranking algorithms more transparent.
Meanwhile, its sister legislation, the Digital Markets Act, will force gatekeeper platforms to allow small businesses access to certain data.
The committee promises that the two bills will ensure a safer and more responsible online environment for all.
Featured Image: Shutterstock/Vector Image Plus
source:
Europe Fits For The Digital Age: The Platform’s New Online Rules, European Commission
Big tech companies try to tame EU tech rules at the last minute, CorporateEurope.org
Digital Services Act: Ensuring a Safe and Responsible Online EnvironmentEuropean Commission
