On August 25, 2023, a new regulatory framework came into effect in the European Union, introducing additional fines for tech giants that fail to comply with the Digital Services Act (DSA). This new EU law complements existing antitrust and privacy regulations, and aims to make the internet safer while improving the protection of EU citizens' online rights.
Under the DSA, 19 specific search engines and online platforms, primarily owned by U.S. tech giants, are required to implement new measures targeting illegal or harmful content. These companies include Amazon Store, Apple AppStore, Facebook, Google Play, Google Maps, Google Shopping, Instagram, LinkedIn, Pinterest, Snapchat, TikTok, Wikipedia, X (formerly Twitter), YouTube, Bing, and Google Search. Additionally, the list includes Chinese online marketplace Alibaba AliExpress, Dutch travel site Booking.com, and German fashion platform Zalando.
While these platforms are not legally liable for harmful or illegal content posted by users, the DSA pushes for swifter intervention against such content. It introduces a transparency and accountability framework that includes banning targeted advertising aimed at children and advertising based on sensitive personal data like gender, race, and religion. The DSA also allows users to challenge content moderation decisions either directly with the tech companies or through legal means.
According to legal experts, the impact of the DSA varies across different types of online platforms. For instance, online marketplaces may focus on combating counterfeit goods, while content-sharing platforms might target fake news. Many of these companies are planning to implement these changes not just in the EU, but globally, in what is termed as the "Brussels Effect."
Lawyers advising some of the affected companies expect a "honeymoon period" before the EU Commission starts rigorous enforcement. They suggest that tech giants will likely have some time to adapt to the new regulatory landscape. Heidi Waem, a partner at DLA Piper's Brussels office, notes that EU officials would need to be meticulous in their preparations before moving forward with major enforcement actions.
The state of compliance among tech companies is currently mixed, according to legal assessments. While some companies like Meta and Amazon have made noticeable changes, especially in reporting illegal content and complaint handling mechanisms, others appear to be in the early stages of compliance.
The DSA also makes a distinction based on the size of the online platforms. Large platforms with more than 45 million users have to comply with more extensive rules compared to smaller players. Amazon and Zalando have already filed legal action challenging their designation as large platforms.
On the user side, the DSA strengthens the ability to challenge content moderation decisions. This comes at a time when the debate over fake news and online misinformation is intensifying. Some legal experts anticipate an increase in challenges from users, particularly as the DSA does not provide a standard definition of "illegal content," leaving it to national laws.
Finally, the DSA aims to correct a perceived power imbalance between consumers and tech giants, empowering citizens with more rights and mechanisms to challenge content decisions. However, as was the case with the GDPR, there is a concern that these rights may also be subject to abuse.
