Questions and Answers

What is the Digital Services Act? Here's what changes for users and companies

The DSA revolutionises the balance of power on the internet, granting rights to users and imposing security and transparency rules on online platforms

by Alessandro Longo

31 May 2024

The European Digital Services Act concept. The letters DSA surrounded by yellow stars on blue background showing Europe. Pins representing the digital nature of the legislation.

4' min read

Key points

To whom Dsa is addressed
What changes for users?
What's changing for companies?

4' min read

The Digital Services Act (Dsa) is operational and tries to change the lives of European internet users by giving them more rights. At the same time it tries to create better conditions for the development of innovation and smaller companies. In other words, the Dsa regulation is Europe's first major attempt to revolutionise the balance of power in the big internet, which it now considers too dominated by big tech. The impact is both on the economy and on society in the digital age.

What is the Digital Services Act?

The Digital Services Act, also called 'digital services legislation', is an EU-approved and far-reaching regulation. It aims to update industry rules in response to evolving digital technologies and business practices. It establishes stringent rules to ensure that online platforms operate in a safe, transparent and accountable manner. As of 17 February 2024, the digital services regulation applies to all platforms. As of the end of August 2023, the rules already applied to designated platforms with more than 45 million users in the EU (10% of the European population), i.e. very large online platforms or search engines.

The obligations laid down grow in proportion to the importance and role of the companies concerned. It should be noted that the obligations and rights (for users and companies) of the DSA are complementary to those of another important piece of European legislation, the Digital Markets Act.

To whom Dsa is addressed

The companies with the most obligations are the big tech companies, those with over 45 million users in Europe. They are followed by other online platforms (those that bring together sellers and consumers, such as online marketplaces, app stores, collaborative economy platforms and social media platforms); hosting services (cloud and web hosting) and brokerage services, which offer network infrastructure (Internet access providers and domain name registrars).

If the European Commission definitively establishes a violation of the Digital Services Act, it can adopt a decision imposing fines of up to 6% of the global turnover of the company in question.

Dsa Objectives

Digital services regulation protects consumers and their fundamental rights by establishing clear and proportionate rules for online activities. It promotes innovation, growth and competitiveness and facilitates the expansion of smaller platforms, SMEs and start-ups. The roles of users, platforms and public authorities are rebalanced according to European values, putting citizens at the centre.

The same rules will apply throughout the Union. The EU expects that thanks to the DSA, cross-border digital trade in the single market will increase by up to 2 per cent.

What changes for users?

We, the users, acquire new rights, always designed to rebalance the balance of power towards internet companies.

More transparency on recommendations provided (on social, ecommerce, etc.): for example, if a user on a platform such as Facebook or YouTube questions why certain content is shown to him, the DSA obliges these platforms to provide clear explanations on the criteria used by their recommendation algorithms.

More effective right of reply: if a user's content is removed for alleged violation of rules, large platforms will have to offer a more transparent, more accessible and independent appeal process, allowing users to defend and restore their content (if unfairly removed).

Protection against harmful content: users will have more powerful tools to report illegal or harmful content, and platforms will have to act quickly to assess and, if necessary, remove it. For Europe, it is important now to protect citizens and society from, for example, misinformation or content that is harmful to weaker parties such as minors.

The DSA inter alia prohibits targeted advertisements on online platforms aimed at minors or advertisements that use sensitive personal data.

For journalists and researchers, provide the right to access platform data in order to understand the associated risks to society and fundamental rights (e.g. to monitor the level of fake news).

What changes for companies?

Digital companies will have to introduce various measures, always with proportionality in relation to their size.

Surveillance of illegal content: ecommerce companies such as eBay or Amazon will have to strengthen their systems to prevent the sale of illegal or counterfeit goods through their sites. There will be policies based on the principle of 'know your business customer' and an obligation to carry out spot checks on products sold on their platform and to adopt new technologies for tracking products

Compliance and data security: companies will have to adopt the best security protocols to protect user data, such as encryption and multi-factor authentication, to avoid data breaches and ensure privacy.

Regular audits and checks: large platforms such as Google and Meta (Facebook, Instagram) will have to undergo regular checks to ensure compliance with the new rules. This includes independent audits and detailed reports on their operations and moderation practices.

Improved ad management: platforms will have to ensure that online advertising is not misleading or harmful. For instance, Google Ads will have to implement more robust systems to filter and reject advertisements that promote illegal products or services.

Ease of reporting: improvements in the user interface to allow easier reporting of problematic content on social platforms, making the process more intuitive and less burdensome for the user. Smaller digital companies that do business with online platforms will be able to make more accurate business decisions by making the internal processes of those platforms more transparent.