EU Parliament Approves Digital Services Act and Digital Market Act

Aug 5, 2022 Benn-Ibler Rechtsanwälte

On 07 July 2022, the EU Parliament passed the Digital Services Act and the Digital Markets Act. The Digital Services Act provides for uniform horizontal rules on due diligence and liability exclusions for intermediary services. The Digital Markets Act supplements existing competition laws, limiting the power of market dominant digital corporations.

The Digital Services Act (hereafter DSA) sets out well-defined responsibilities as well as a duty of accountability for providers of intermediary services, particularly for online platforms such as social media and marketplaces. The laying down of clear due-diligence measures will also include reporting and remediation procedures related to illegal contents as well as the possibility to contest platform decisions on contents moderating. For major online platforms in particular, the DSA provides for a higher degree of transparency and accountability regarding how providers of such platforms moderate content, as well as with respect to promotions and algorithmic processes. The DSA is designed to ensure that certain contents will be taken down more quickly (e.g., hate speech), aiming to curb the market power of internet corporations with the eventual goal of improving legal protection for users across the EU.

The focus of the DSA is to ensure the smooth functioning of internal markets in dealing with the provision of cross-border digital services (intermediary services). 

The Digital Markets Act (hereafter DMA) complements competition law and limits the power of market-dominating digital corporations. The DMA is limited to some core platform services such as online intermediation services, online search engines, social networks, video sharing platform services, non-numbered interpersonal communication services, operating systems, cloud services, and advertising services.

The objective of the DMA is to tackle the most flagrant cases of unfair practices and low contestability at EU level so that platforms can realise their full potential, allowing both end-users and business users to reap the benefits of the platform economy and the digital economy in a fair and competitive environment.

Once the final draft has been adopted, both regulations will be directly enforceable in all EU Member States after a certain transitional period.

COM/2020/825 final

COM/2020/842 final