On 25 August 2023, the provisions of the Digital Services Act applying to very large online platforms and search engines (respectively VLOPs and VLOSEs) entered into force.
For the first time, very large online platforms and search engines will face heavy fines - up to 6% of the platform’s total worldwide annual turnover - in case of non-compliance with specific rules applying for their services provided in the European Union.
Provided within the section 5 of the DSA, these rules aim at addressing the issue of online harms at a large scale with targeted requirements for major online platforms and search engines designated as such by the Commission.
A brief overview of the new legal framework.
The designated VLOPs and VLOSEs:
According to the Article 33(1) and 33(4) of the DSA, online platforms and search engines with a number of average monthly active recipients of the service in the European Union equal to or higher than 45 million and designated by the Commission have to comply with additional obligations.
So far, 17 very large online platforms and two very large search engines were designated by the Commission. It represents 13 companies, 10 of which are US companies while two are Chinese and one is German.
Two of them, the German company Zalando and the American company Amazon, have already challenged their designation, claiming that most of their revenue in Europe come from a retail business, which is not covered by the DSA. The Commission intends to defend its position. To be continued...
The new obligations (Art. 35-43):
While being subject to the limited liability regime for online intermediaries, the providers of the designated VLOPs and VLOSEs shall comply with additional obligations requiring them to:
Challenges of implementation and next steps:
The implementation of the DSA and this new regulatory framework might face several challenges, such as the lack of qualified human resources, the lack of means for trusted flaggers, or the risk of "risk assessment washing".
Furthermore, some legal uncertainty remains as secondary legislation is still expected.
The effects of the DSA on online safety in Europe are now under scrutiny... To be followed.
While the Commission is the competent authority for supervising the designated platforms and search engines, it will work in close cooperation with the Digital Services Coordinators (DSCs) further to Art. 49. EU Member States will need to empower DSCs by 17 February 2024, the general date of entry in application of the DSA, when the DSA is fully applicable for all entities in its scope.