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EU working on a new Digital Services Act to regulate online platforms

By 4 November 2020No Comments

The European Union is working on a new Digital Services Act that will serve as a modern legal framework to ensure the safety of users online, one that will effectively monitor digital platforms and guarantee effective enforcement.

According to the European Commission, the legal framework to govern digital services in the EU has remained unchanged since the adoption of the e-Commerce Directive in 2000, despite a major evolution in and the rising adoption of online platforms, tools, and services.

The existing e-Commerce Directive governs commercial communications, electronic contracts, limitations of liability of intermediary service providers, and sets rules of transparency and information requirements for online service providers. Its purpose is to remove obstacles to cross-border online services in the EU and provide legal certainty to business and citizens.

The European Commission says the new Digital Services Act will respect the basic principles underpinning the legal framework of the e-Commerce Directive while serving as a modern legal framework to ensure the safety of users online and to allow innovative digital businesses to grow.

The Act will make it the legal responsibility of digital services to address the risks faced by their users and to protect their rights and will also make it easier for new entrants and existing competitors to challenge and compete with large online platforms which now set the rules of the game for their users and their competitors.

“Many online businesses have struggled with systematic problems familiar to the platform economy regarding contestability, fairness, and the possibility of market entry. Large online platforms are able to control increasingly important platform ecosystems in the digital economy.

“Typically, they feature an ability to connect many businesses with many consumers through their services that, in turn, allows them to leverage their advantages, such as their access to large amounts of data, from one area of their activity to improve or develop new services in adjacent markets.

“The European Single Market therefore requires a modern legal framework to ensure the safety of users online and to allow innovative digital businesses to grow, while respecting the basic principles underpinning the current legal framework of the e-Commerce Directive,” the Commission said.

According to the European Parliament, one of the fundamental issues that the Digital Services Act must address is protecting users against harmful or illegal content online. Rather than relying on voluntary action by online platforms, the Act will establish clear, EU-wide rules for content moderation, applying the so-called notice and action mechanism.

The content moderation mechanism will enable users to easily notify online intermediaries about potentially illegal online content, give affected users the right to appeal the takedown of content, and respect users’ rights and freedoms, such as freedom of expression and information by moderating content in a diligent, proportionate and non-discriminatory manner.

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