Digital Services Act

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What is the Digital Services Act?

The Digital Services Act (DSA) represents a significant milestone in the evolution of the European Union's Digital Single Market. It aims to modernise the foundations of the 2000 e-commerce directive and strengthen transparency, security and the promotion of European values on the internet and online platforms.

Current status and timeline

The Digital Services Act came into force on 16 November 2022 and is fully applicable from 17 February 2024.

Who is affected?

The new rules affect all intermediary services, i.e. mainly online platforms, and apply regardless of whether they have their place of business in the EU, as long as they serve users with a business or residence in the EU.

What are the challenges?

The Digital Services Act (DSA) poses a number of challenges to companies that require significant adjustments in their operational processes and structures.

Below are some of the main challenges:

Adapt notice-and-take-down processes: Online platforms will need to revise their existing processes for reporting and removing unlawful content to comply with the new requirements of the DSA.
Review and adaptation of platform T&Cs: Companies may need to revise their General Terms and Conditions (T&Cs) to bring them in line with the new DSA rules.
Implementation of new transparency obligations: In particular, new transparency obligations must be observed when placing advertisements. Companies must make clear who is responsible for a particular advertisement and according to which parameters it is displayed to the user.
Introduce know-your-business-customer principles: Certain platforms need to introduce Know-Your-Business-Customer (KYBC) processes. In doing so, platforms must comprehensively identify their merchants to enable an assessment of the merchant's location, business structure and creditworthiness.
Consideration of the tiered obligations: Depending on the size of the company and its business model, different requirements must be met. Very Large Online Platforms" (VLOPs) in particular must fulfil comprehensive compliance and due diligence obligations.
Handling of fines: Significant fines may be incurred for breaches of the DSA (up to 6% of annual turnover or imposition of recurring daily turnover-based fines of 5% as leverage). Companies must ensure that they are fully compliant to avoid such penalties.

Our expertise for your success

SKW Schwarz has developed a range of specific consultancy products designed to help companies meet the requirements of the DSA. Here are some of the core services we offer:

Compliance advice: We advise you individually and guide you step by step through the new requirements of the DSA and help you to ensure that your company complies with the new regulations.
Advice on adapting T&Cs and processes: Our team of experts can help you review and adapt your existing terms and conditions (T&Cs) and processes to ensure they comply with the new DSA requirements.
Advice on the implementation of transparency obligations: We can help you implement the new transparency obligations, especially in the area of advertising, and ensure that your company provides the required information.
Advice on the implementation of Know Your Business Customer principles: Our team can help you integrate the Know-Your-Business-Customer principle (KYBC) into your business processes to ensure smooth identification of your merchants.
Defence against fines: We offer advice and support in handling and defending against fines in connection with violations of the DSA.