The European Digital Service Act regulation, due to come into force in 2024, will impose new obligations on marketplaces. Among their customers are many very small and medium-sized businesses. What are the repercussions and consequences for these companies?
What is the Digital Service Act?
Passed by the European Parliament on July 5, the Digital Service Act (DSA) will come into force on January 1, 2024.
Its aim is to combat:
- sale of illegal products (drugs, weapons, counterfeit goods)
- distribution of illegal or harmful content (child pornography, racism, fake news) online
The DSA regulation has several objectives:
- online consumer protection
- defending freedom of expression and other fundamental rights of Internet users
- development aid for small businesses in the European Union
- the fight against misinformation
- control of major platforms
Various digital players are affected by the DSA regulation, from cloud services to GAFAM (Google, Apple, Facebook, Amazon and Microsoft), marketplaces, travel and accommodation platforms, social networks and app stores. What all these players have in common is that they are online intermediaries, marketing goods, content or services.
These online intermediaries will have to comply with new requirements, more or less stringent depending on their weight, the nature of their services or the scale of the risks involved.
What is illegal offline is also illegal online.
- European Commission 🇪🇺 (@EU_Commission) October 9, 2022
This week, we welcomed the @EUCouncil's adoption of our #DigitalServicesAct.
The new rules will:
⛔️ ensure online platforms are held responsible for tackling harmful content
🛡️ better protect internet users#DigitalEU
Marketplaces: what changes for business customers?
Although small businesses are not the target of the DSA regulation, they will nonetheless indirectly suffer the consequences.
Indeed, the major online platforms, for which very small businesses are often the main customers, will have to demonstrate greater transparency. Marketplaces such as Amazon will be required to be more vigilant with regard to the sellers for whom they act as intermediaries.
In particular, they will have to collect more information on their VSE and SME customers, ensure the provenance and reliability of products and services, and guarantee traceability. Consumers will thus be better informed.
With the implementation of the DSA regulation, VSEs and SMEs whose content or offer has been removed from a marketplace will now be able to know the reasons for this decision. Online platforms will also be obliged to inform them of existing remedies, and businesses will have 6 months from notification to contest the decision.
The DSA regulation will force platforms to implement new procedures and features on their sites, such as a tool enabling web users to simply report illegal content or products. All this will come at a cost, which is likely to be passed on in part to the VSE and SME customers of these platforms, notably via an increase in commissions.