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ARTICLE17 September 2020

Commentary on the Digital Services Act

The European Commission, through its new ‘Digital Service Act’ (DSA) is proposing novel and revised rules for digital services. In particular, these will address the responsibilities and obligations of digital services and strengthen supervision of digital services in the EU.

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The overarching goal must be to establish a functioning and secure internal market, with room for new technology. Photo: Roald, Berit

This may well prove an excellent framework; it is clear that the rapid expansion of the platform economy is demanding rapid adaptations to the existing regulations. However, the overarching goal must be to establish a functioning and secure internal market, with room for new technology and new business models, not least to strengthen our competitiveness. Our positions on the DSA do not include digital marketplaces, which may need to be managed within DSA but in a separate proposal.

For other digital services within the scope of the DSA, our positions are summarised as follows. We propose that a couple of important principles should remain unchanged from the existing Directive. First, it should be possible for small and medium-sized enterprises (SMEs) to expand and scale up rapidly, without having to adapt to specific laws in other Member States. The internal market clause must not be open for any review. Second, the exemption from liability of intermediaries for the content they manage if they fulfil certain conditions should remain. Third, Member States should not force any general content monitoring obligation on intermediaries.

In the new proposal, we believe that it is important that the regulations recognise and promote the proactive work by service providers against illegal content online. A basic principle should also be that any updated new rules should be proportionate and - as far as possible - be principle-based and technology-neutral. This will provide predictability, innovation power and support a positive investment climate. This way, we can ensure that companies are able to take full advantage of the Digital Single Market.

Hassle with rules and unnecessary bureaucracy must be curbed. The principle of better regulation should therefore be taken into account in developing this legislation; overlapping and contradictory rules must be avoided. The regulations should be upgraded, in order that they also apply to those service providers that are not established in the EU but offer services that reach the internal market.

A limited number of large services providers control increasingly important platform ecosystems in the digital economy. This is leading to imbalances that affect not only consumers and competition but also innovation. As part of the legislative proposal, the Commission has advanced proposals for measures to address these imbalances.

Ex ante regulation of digital markets could provide a way forward, assuming it takes place in such a way that it addresses all the problems that may arise in such regulation. However, there are a number of considerations that first need to be made. New regulations - including ex ante regulation - must meet normal requirements for an intervention and any new public regulation of business activities

.The rate of development means that it is very difficult to predict the technology of the future. It is therefore also difficult to know the direction that the market would have developed without intervention. The competition authorities must therefore be properly prepared to ensure legally sound and more-effective competition analysis. Only lawyers will benefit from time-consuming competition legal analyses.

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Subscribe to our Swedish newsletter
Contact our EU-Office

Address

Rue du Luxembourg 3
BE-1000 Bruxelles Open map
Subscribe to our Swedish newsletter
Contact our EU-Office

Address

Rue du Luxembourg 3
BE-1000 Bruxelles Open map
Subscribe to our Swedish newsletter
Publisher and editor-in-chief Anna Dalqvist