Online platforms have until the end of this week to reveal their user numbers as the EU’s Digital Services Act begins to take shape and bring companies under its scope, a senior EU official revealed today, February 14.
Platforms have until Friday, February 17, to report key facts and figures including the number of active users or “recipients of their service”, said Irene Laguna, deputy head of unit at DG Connect in the European Commission and one of the chief drafters of the DSA.
The DSA, the text of which was agreed last year, marks an overhaul of the 22-year-old e-Commerce Directive. Among other things, that directive covered online enforcement and protection of rights.
Laguna was speaking during a webinar on the DSA hosted by the EUIPO this morning. Her comments provided intellectual property owners with a sense of when they can expect more movement on the DSA and for its provisions to be adopted.
Rules and regs
Any platform that says it has more than 45 million users will be designated as a ‘very large online platform’ (VLOP) and be subject to the DSA’s full obligations – including requirements to reveal seller information and respond to takedown requests.
Laguna did not give a firm timeframe for when the EU will officially designate platforms, but she noted that the DSA will apply to them four months after such a designation.
“For example, if we were to receive the information regarding the number of users on Friday and then designate a company as a VLOP on April 1, they would then be bound by the DSA on August 1,” she explained.
Under the DSA, all platforms have to have a notice and action policy. They are compelled to send acknowledgement of receipt to IP owners. There is no obligation to remove suspected infringing listings but platforms are required to inform IP owners about the steps taken.
However, so-called VLOPs face additional rules including stricter ID checks and must make “reasonable efforts” to ensure their platforms are free from infringing listings.
In a flavour of the type of platforms that could fall into the VLOP category, 89% of webinar viewers said they were regular WhatsApp users. In the same poll, 44% said they were most often on Amazon.
Meanwhile, around 33% of respondents said they had flagged suspected infringing content on the platforms listed in the poll, which also included TikTok and Instagram.
Brand concerns
The final text of the DSA was agreed in April last year following the conclusion of five trilogue negotiations between the European Parliament, Council and Commission.
Parts of it, however, received a muted reaction from brand owners which worried that its scope did not go far enough.
Two of the major oversights identified were a refusal to extend formal ID and ‘know your business customer’ (KYBC) checks to social media platforms and minor e-commerce marketplaces, and a lack of a so-called ‘stay-down’ mechanism that would prevent counterfeits from reappearing once they are taken down.
During the webinar’s Q&A section, Laguna addressed the seeming lack of proactive measures for social media platforms regarding KYBC.
However, she said it would be wrong to assume that social media platforms were excluded from the DSA’s scope.
“The regulation deliberately does not specify the type of platforms, and instead says it applies to a type of service that allows business transactions to be conducted with customers. If a platform enables transactions to be conducted, then it will fall in the scope of the DSA.”
She added that this could include social media platforms.
Change on horizon
Elsewhere, Laguna announced more timelines for when member states should begin adopting the act into national law.
Member states will have until February 17 2024 to appoint specialised digital services coordinators. These officials will act as a contact point for IP owners to raise suspected DSA breaches and can also, upon application from a brand owner, designate so-called trusted flaggers.
A trusted flagger will be given special status and any notices of suspected infringement they send must be dealt with immediately, Laguna said.
Service providers based outside the EU but which still sell to consumers inside the bloc will also need to appoint a coordinator, Laguna added. She admitted it would be “challenging but not impossible” to ensure those types of platforms complied with the DSA.
This was not the only challenge identified.
Creating a new, harmonised law fit for the modern age was always going to pose its difficulties. The rules outlined in the e-Commerce Directive were not necessarily fit for purpose and change had to happen, Laguna explained.
To demonstrate, she displayed a graphic outlining the number of platforms and service providers online before the year 2000 compared to the growth of these companies in the years since.
She added: “This does not mean the internet will stop evolving. We are often receiving questions about new technologies and the metaverse and how the DSA will sit within that. We have tried to create a technology-neutral DSA and we believe it has strong teeth.”
However, the DSA will still need to take shape before IP owners truly can assess its bite.
