Europe fit for the Digital Age: Commission proposes new rules for digital platforms

Center of these two proposals are European values, which aim to better protect consumers and their fundamental values in the Internet. This should result in a more fair and transparent digital market. Promoting innovation, growth and competitiveness ensures that new or improved online services are available to users. Smaller businesses and start-ups are also supported, as access to customers is made easier and legal costs decrease. In addition, the new rules prevent online platforms that have become or are becoming "gatekeepers" from applying unfair conditions.

Digital Services Act

In order to counteract online platforms and their particular risks for users, these newly proposed  rules impose EU-wide mandatory obligations on all systemically important digital services that provide goods, services or content to consumers. A digital service is considered important if (if it reaches more than 10% of the EU-population.

Furthermore, new procedures for a faster removal of illegal content and comprehensive protection of the mediating platforms and the authorities are foreseen. The proposal complements the ”European Democracy Action Plan”.

The following matters are proposed to be regulated:

  • Rules for the removal of illegal goods, services or content online;
  • Safeguards for users whose content is mistakenly deleted by platforms;
  • New obligations for very large platforms to take risk-based measures to prevent abuse of their systems;
  • Extensive transparency measures, (especially online advertising and algorithms used to recommend content to users);
  • Powers to study how platforms work (researchers are given access to key platform data);
  • Provisions for tracking commercial users on online marketplaces to make it easier to track sellers of illegal goods or services;
  • An innovative inter-agency cooperation process to ensure effective enforcement across the single market;
  • Provision for platforms to be sanctioned directly by the Commission

Digital Markets Act

The newly proposed Digital Markets Act prohibits certain practices of platforms acting as digital "gatekeepers" in the single market. Through their established position, various (private) platforms may become so powerful that a whole set of rules might be created by them. Hence, other providers could be denied in reaching customers by unfair business practices of such gatekeepers. The Act is based on the "Platform to Business Regulation" and shall include the following:

  • This proposed law applies to those providers of the core platform services that are most exposed to unfair practices (e.g. search engines, social networks). However, these must meet the objective legal criteria as "gatekeepers";
  • Thresholds for the identification of "gatekeepers”;
  • Prohibition of clearly unfair practices;
  • Fines of 10% of worldwide turnover as prevention of violations;
  • The Commission is given opportunities to conduct targeted market investigations, to assess whether new practices need to be included, so that it can keep up with the fast development of digital markets.

Autor: Christina Hummer