DSA trialogue: Six things negotiators need to do right

Next week, EU negotiators will launch final negotiations on the Digital Services Act (DSA) proposal. The DSA will define what users can see, how consumers shop and interact online. It will oversee the operation of digital services and moderate content seamlessly for years to come. Ambitiously, European legislators want to “make the new gold standard for the world”. For that to happen, here are six things negotiators need to do right.

Provide more transparency and control to users

Who is better placed to decide what people see online: the users themselves or the decision-makers? Users and consumers interact with a wide range of content every day and have different preferences for what they want to see online. The European Commission and the Council of the EU want to strengthen the tools of transparency in terms of preferences and personalization of content. However, the European Parliament wants to go further and introduce strict limits on targeted advertising. European lawmakers will want think twice when developing practical rules that take into account the interests of small European businesses, consumers and press publishers.

Protect user and business data

How would consumers, users, and businesses react if they knew the DSA needed to require platforms to license law enforcement, “certified researchers,” and “certified nonprofit organizations to access their highly sensitive information? The DSA should further clarify this by including safeguards regarding confidentiality, the scope and nature of the data that may be requested, the purposes for which the data may be used, and the manner in which that data may be accessed. In addition, the processes and criteria for obtaining “Approved Researcher” and “Approved Not-for-Profit Organization” status should be strengthened (for example, by including transparency requirements on the funding that researchers may receive for their academic projects, and giving platforms the right to appeal the verification of a particular researcher). Calls to force platforms to disclose user data to NGOs and journalists should also be limited to public transparency reports. The EU has been a normative body when it comes to data protection; ensure that any obligation meets these standards and is aligned with existing data protection rules.

Make marketplaces responsible only for what they can reasonably verify

The text of the European Parliament requires online platforms to carry out “random checks on the products and services offered to consumers”. If the intentions of the legislator are legitimate, such measures are impossible to put into practice given the specificities such as the download speed and the huge amounts of content to be processed. The measures would therefore not meet the objectives of policy makers.

If the DSA imposes disproportionate liability and due diligence obligations, online marketplaces may become very careful, especially in light of the risk of steep fines — up to six percent of the platform’s annual revenue. In other words, online marketplaces could allow only large, established third-party sellers to offer products to users through their platform, as these pose a lower risk of non-compliance. This could have negative effects not only on the scalability of small and medium-sized enterprises (SMEs), but also on consumer choice and prices across the EU.

Inform without overwhelming users

Users may receive an overwhelming amount of notifications; and intermediary services risk an unmanageable scale of transparency and recourse requirements for users. The AVD includes “demotion” Where “other actionsin categories of content moderation decisions for which users receive notifications or which could be challenged. Notices and remedies should be focused on protecting free speech and limited to account deletions or suspensions. If the obligations are disproportionate, they jeopardize content moderation practices.

Clarifying how due diligence obligations work

It seems that different institutions have different interpretations of due diligence and “know your business customer” (KYBC) obligations. An ambiguity can be detected between the positions of the European Parliament and the Member States, and even each of their texts. It is crucial that the DSA ensure that the due diligence obligations are clear and unambiguous as to who they apply and how they apply. Obligations must remain reasonable and proportionate.

Be neutral on the channel

Policy makers agree to ensure a level playing field between the online and offline world. “What’s illegal offline is also illegal onlineis their mantra. But the fervor of this ambition leads to the possibility of going too far. Online obligations may extend beyond those that apply to offline or “physical” businesses.

As negotiators seek to finalize the DSA negotiations, hopefully they will ensure that Europeans can continue to enjoy all the economic and social benefits of digital services.

About Cedric Lloyd

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