The new European Union law on digital services Digital Services Act (or simply DSA) came into effect yesterday, August 25, and imposes strict regulations on 19 of the largest digital service providers operating in the region.
The new regulations aim to tackle illegal content, misinformation and give more control over social media algorithms to users themselves.
The DSA, which approved in April 2022, targets digital platforms that have more than 45 million monthly active users. Affected companies include major services such as Facebook, Instagram, Google, Bing, Apple's App Store and Google Play Store, as well as various platforms such as Booking.com, Aliexpress and Snapchat.
Basic Provisions
Content transparency and moderation: Services must publish reports detailing content moderation decisions and risk management.
Advertising restrictions: Targeted advertising to children is prohibited.
Algorithm control: Gives users an option to opt out of schedules used by algorithms, giving them more control over the content they see.
Illegal content and misinformation measures: Platforms are required to address illegal content, misinformation and should offer user-friendly complaint procedures.
Risk Assessment and Reporting: New annual reports are mandatory where tech companies must identify platform risks, including disinformation and mental health impacts.
Protection of minors and sensitive data: The rules limit the information that can be used for targeted advertising, especially regarding minors and various sensitive data, such as political opinions or sexuality.
Oversight and compliance: A new supervision system is introduced, including self-assessment by companies, with the European Commission conducting audits. The deadline for the first report was yesterday.
Companies are required to pay a levy which will fund the enforcement of the DSA. Failure to comply could result in fines of up to 6% of annual global revenue or penalties of up to 5% of average daily revenue.
The new regulations are comprehensive, consisting of 92 articles that must be met, which requires significant adjustments in too many companies. Both Meta and TikTok reportedly have more than 1000 employees working to ensure compliance with the new law.
The regulations currently apply to the 19 largest digital services, but will be extended to other online services and platforms, including cloud providers, internet providers and content sharing platforms by February 2024.
Reaction and Analysis
The DSA represents a significant change in the European Union's approach to the regulation of large technology companies. It aims to provide a more transparent and responsible digital environment and to protect citizens from unwanted personalized advertising and misinformation.
Sarah Eskens, assistant professor of law and technology at the Free University of Amsterdam, he says that the DSA challenges platforms to examine their social influence, particularly regarding illegal content and influence on public discourse.
However, the full impact of DSA will be slow to see. Big tech companies have significant financial resources and there could be protracted legal battles.
Overall, the Digital Services Act marks an important step for the EU to gain more control over the industry. Its global influence can set new standards for digital governance.
What is the Digital Services Act or DSA?
The Digital Services Act (DSA) is a European Union regulation introduced to update the legal framework surrounding online platforms, in particular regarding illegal content, transparent advertising and disinformation. Enacted in 2022. The DSA modernizes the previous E-commerce Directive of 2000 ( e-Commerce Directive), with the aim of harmonizing various national laws across the EU.
It outlines new obligations for platforms, particularly those with more than 45 million users in the EU, to improve content moderation and transparency in areas such as the operation of algorithms and advertising.
The DSA also maintains existing liability exemptions for hosting providers, sets fines for non-compliance and defines 19 specific very large online platforms (VLOPs from Very Large Online Platforms ) and search engines for immediate adjustment.
The introduction of the DSA is considered a very crucial step in improving data governance in Europe and responding to emerging challenges such as disinformation and unfair competitive practices.
