7 Things You Need To Know About The Digital Services Act (DSA)

The European Union Commission recently announced that Parliament and member states have come to a “sharp political agreement” on the proposed Digital Services Act (DSA).

The DSA aims to protect Internet users by setting an “unprecedented new standard” for online platforms that would hold companies such as Google, Meta (Facebook) and Twitter accountable for illegal and harmful content.

In addition, the DSA will mandate online platforms to share how their algorithms work, establish procedures to quickly remove illegal goods and materials, and crack down on users spreading misinformation.

What is the Digital Services Act, when does it go into effect, and what does it mean for platforms and the people who use them – including digital marketers?

Here’s what you need to know about DSA right now.

1. What is Digital Services Act?

Currently, the DSA is a proposed piece of legislation that was first brought forward by the European Union Commission on December 15, 2020.

That offer came with two associated offers. in that first announcementThe commission said:

“The Commission has today proposed an ambitious reform of the digital space, a comprehensive set of new rules for all digital services, including social media, online marketplaces and other online platforms operating in the European Union: digital services act And this digital market act,

The Digital Markets Act is designed to ensure equal opportunity among businesses and came into force in March.

According to the European Commission, comprehensive DSA’s goalsOn the other hand, there are:

  • Better protect consumers and their fundamental rights online.
  • To establish strong transparency and clear accountability framework for online platforms.
  • Fostering innovation, development and competition within the single market.

In essence, this new law would hold search engines, social media networks and marketplaces accountable for policing the content on their sites.

2. When does the DSA take effect?

As of publication, the European Parliament and EU member states have agreed to take the proposal forward.

Now, it is under review by two co-MLAs.

According to a media release dated 23 April,

“Once adopted, the DSA will apply directly to the European Union and will be in force for fifteen months or from 1 January 2024, whichever is later, after it comes into force.”

Online platforms and search engines classified as “very large” (which reach 45 million or more users in the European Union) will still be subject to the DSA’s terms, four months after their designation.

3. Which online platforms have to be complied with?

The law defines digital services as “a large range of online services ranging from simple websites to Internet infrastructure services and online platforms”.

All digital services that do business in the EU are subject to the DSA, regardless of where the business is set up – even small and micro companies (though the rules are commensurate with size).

Small to medium-sized digital services make up 90% of affected businesses in the EU and will be exempted from the most expensive regulations.

The types of digital services subject to this law include:

  • online marketplace
  • Social Networks
  • content sharing platforms
  • app Store
  • online travel platform
  • housing platform
  • Intermediary services such as Internet providers and domain registrars
  • Cloud and web hosting services
  • Allied Economy Forum

DSA also applies to “gatekeeper” platforms, defined as They “play a systematic role in internal markets that act as barriers between businesses and consumers for critical digital services.”

Platforms that reach 45 million or more users in the EU – classified as “very large” – also need to assess the risks of their systems to the public interest, fundamental rights, public health and safety. will be required.

These platforms must demonstrate that they are using appropriate risk management tools and take measures to protect the integrity of their services and prevent manipulation by bad actors.

Google currently enjoys 92.04% of the EU search engine market share and will be subject to the highest level of regulation.

with 309 million daily active users In Europe, Facebook also qualifies as “too large” for the purposes of the DSA.

Other platforms and social networks that have surpassed the 45 million EU user benchmark include:

  • Twitter
  • instagram
  • TIC Toc
  • Apple
  • Spotify
  • Microsoft
  • heroine

Due to freedom of information requests to the European Commission and the Swedish government, documents issued to Corporate Europe Observatory (CEO) and Global Witness show that each phase of the DSA’s journey from Commission to Council and Parliament has been heavily lobbied by Big Tech .

“New self-declared lobby data shows that Google, Facebook, Apple, Amazon and Microsoft all increased their spending on EU lobbying during this period,” CEO’s report,

“Combined, Big Tech firms spent more than 27 million euros in just one year. All five companies increased their budgets, but by far the biggest increase was Apple, which nearly doubled its lobbying spending.” given,” he said.

Surveillance advertising, user tracking and behavioral targeting were reportedly among the most controversial issues.

4. OK, But What Does the DSA Actually Do? Doing,

The Commission states that the Digital Services Act will:

“… Create horizontal rules to ensure accountability, transparency and public oversight of how online platforms shape the information space in which our societies thrive.”

At its core, the DSA is a regulatory framework that will enforce rules on how platforms:

  • medium material,
  • advertising,
  • and use algorithmic procedures.

That last point can be massively inconvenient for major search engines, such as Google and social/advertising platforms like Meta, because they have to explain to users how their algorithms work.

Under the DSA, digital services face hefty fines – up to 6% of their annual turnover – for non-compliance.

5. What do digital services companies need to do?

Obligations for intermediary services such as IP and domain registrars include:

  • reporting transparency
  • Requirements on conditions of service due to fundamental rights
  • cooperation with national authorities
  • Points of contact and, where necessary, legal representatives

Hosting services are obliged to comply with the above, as well as “information and actions and obligations to provide information to users” and to report criminal offenses to the authorities.

The rules become more difficult for online platforms that are required to comply with the above obligations and include:

  • Grievance and Redressal Mechanism and Out of Court Dispute Settlement
  • reliable flagger
  • Remedies against derogatory notices and counterclaims
  • transparency of recommendation system
  • User-facing transparency of online advertising

Additionally, regulations prohibit online platforms from targeting advertisements to children and prohibit targeting based on particular characteristics of users.

The Marketplace has special obligations, including checking the creditworthiness of third party suppliers and compliance by design. They are subject to random checks.

Very large online platforms – Meta, Google, et al. – Must comply with all of the above and are also responsible for:

  • Risk Management Responsibility and Crisis Response
  • External and independent auditing, internal compliance functions and public accountability
  • User choice not to recommend based on profiling
  • Sharing data with officials and researchers
  • codes of conduct
  • crisis response support

6. So what is this algorithm about?

One of the effects of strong public surveillance of online platforms reaching more than 10% of the EU’s population (about 45 million people) is:

“…transparency measures for online platforms on various issues, including the algorithms used for recommendations. ,

Another section said the DSA will ensure that researchers have access to key data from the largest search engines to inform their understanding of how online risks evolve.

According to the official document, countries are the first line of defense in the DSA, the enforcement falls on the commission.

7. What does this mean for online advertising?

According to the commission’s report, gatekeeping of large online platforms has become problematic as it hinders competition and hurts SMEs and startups.

Small businesses and organizations rely on large platforms for communication and moderation of content rankings.

Because gatekeeper platforms such as Google and Facebook hold the key to accessing consumer data resulting from these activities, SMEs and startups end up in direct competition with gatekeepers who use their data to serve their own interests (such as Selling back targeting SMEs) )

The DSA will partially level the playing field by making the inner workings of advertising and ranking algorithms more transparent.

Meanwhile, its partner legislation, the Digital Markets Act, would compel concierge platforms to give small businesses access to certain data.

The Commission promises that both these Acts will ensure a safer, more accountable online environment for all.

Featured image: Shutterstock/Vector Image Plus

Europe fit for the digital age: new online rules for platforms, The European Commission
Big Tech’s last-minute effort to subdue EU technical regulations, CorporateEurope.org
Digital Services Act: Ensuring a safe and accountable online environmentThe European Commission

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