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Tech & Sourcing @ Morgan Lewis

TECHNOLOGY, OUTSOURCING, AND COMMERCIAL TRANSACTIONS
NEWS FOR LAWYERS AND SOURCING PROFESSIONALS

This month the European Commission (Commission) is expected to publish the Digital Services Act (DSA), a package of EU legislation intended to modernize the legal framework for digital services in the European Union. The Commission announced the DSA in January 2020 as part of its Shaping Europe’s Digital Future initiative.

According to the European Parliament, the DSA aims to “shape the digital economy at [the] EU level as well as [set] the standards for the rest of the world, as it did with data protection.”

The publication follows a public consultation on the act that ran from June through September 2020. The consultation sought input on six topics:

  • How to effectively keep users safe online
  • The liability regime of digital services acting as intermediaries
  • Other issues deriving from the gatekeeper power of digital platforms
  • Other emerging issues and opportunities, including online advertising and smart contracts
  • How to address challenges around self-employed individuals offering services through online platforms
  • The appropriate governance for reinforcing the single market for digital services

The DSA comprises two main themes:

  • First, the responsibilities of digital services to mitigate risks faced by their users and protect their users’ rights. The DSA is expected to create a modern system of cooperation for the supervision of online platforms and introduce procedures to guarantee effective enforcement.
  • Second, the DSA is concerned with the competition and antitrust implications of large online platforms. The DSA is expected to propose rules governing online platforms that act as “gatekeepers,” thereby increasing choice for consumers and the ability of new entrants, such as innovators and small and medium enterprises, to enter the market.

The DSA will replace the current framework for digital services, the e-Commerce Directive, which was published in 2000 and is in need of an update to reflect new technological realities. The DSA is a valuable opportunity to harmonize and reshape the EU legislative framework, safeguard users’ rights, clarify the responsibilities of digital intermediaries, and preserve the competitiveness of the EU digital single market.

Morgan Lewis is monitoring developments with the DSA and will update this blog.

Trainee solicitor Rebecca Agliolo contributed to this post.