The Digital Services Act (DSA), came into force. on 16 November 2022 with a compliance deadline of 17 February 2024 (with earlier deadlines for the largest market players). However, all online platforms must publish the number of average monthly active recipients of their service by 17 February 2023.
The DSA categorises services as intermediary services, online platforms, search engines, very large online platforms and very large search engines, with tiered obligations focusing on content moderation, transparency and accountability – depending on the nature of the individual service. There are also new obligations for online marketplaces.
Categorisation of Platforms
As a first step, all online platforms will need to determine which obligations they are subject to. For example:
- a retail platform which allows third parties to upload content and advertise items for sale will at the very least fall into the category of being an online platform – with obligations applying whether the platform is B2B or B2C
- further requirements are imposed on marketplaces (online platforms which allow consumers to conclude distance contracts with traders)
- an assessment will also need to be made as to whether the online platform falls into the category of being a very large online platform (VLOP) – which triggers more substantial obligations.
Obligations for Online Marketplaces
Even where an online marketplace is not categorised as a VLOP, there are still significant new requirements, including new processes and disclosures (both proactive and reactive). Online marketplaces are required to:
- Update T&Cs to include information on restrictions that apply to the use of the service and parameters used in recommender systems. .
- Establish notice and take down procedures for illegal content.
- Provide a statement of reasons when removing content or suspending or terminating the service provided.
- Develop a complaint handling system that allows users to appeal decisions on notice and takedown, account suspension or other restrictions.
- Publish annual reports on content moderation. To include, amongst other things, the number of orders/notices received and how they were actioned, and number of complaints received.
- Include prominent ad disclosures. Identifying the advertiser and main parameters of ad targeting.
- Traceability requirements. To obtain, verify and publish information on all traders offering goods/services or promoting messages via the platform to EU consumers.
- Design a compliant online interface. Allowing traders to provide all information required to comply with EU law – including all consumer law obligations.
- Carry out “random checks” to identify illegal products and services. Informing users where they have bought illegal products/services including trader identity and means of redress.
In terms of immediate steps, online marketplaces must:
- by 17 February 2023 (and at least once every six months thereafter) publish EU user numbers i.e. the average monthly active recipients (MARS) of the service in the EU on the platform. This requirement applies to all online platforms. This is a challenging exercise made tricky by the broad definition of MARS, a lack of guidance regarding how to carry out the calculation and the technical challenge of accurately counting MARS.
- carry out a detailed analysis to:
- determine how the platform is categorised and what obligations apply under the DSA; and
- develop a strategy to ensure compliance.
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