What is the Digital Services Act and what does it mean for US law firms?

Two years after American tech and e-commerce platforms were faced with the General Data Protection Regulation (GDPR) — EU’s updated data protection law — it is time for businesses that have an online presence to adapt once again. Now, the EU has revealed the Digital Services Act aimed to secure the user’s data handling and demand more responsibility from the big tech. But how will the DSA impact US lawyers? 

What is the Digital Services Act?

EU’s Digital Services Act reportedly has two main goals:

  • to provide a safer digital space in which the fundamental rights of all users of digital services are protected; 
  • to level the playing field to foster innovation, growth, and competitiveness, both in the European Single Market and worldwide.

The DSA does not change the definition of what online content is legal or illegal to post, but rather puts more pressure on businesses and digital platforms to stick to the already existing legal norms.

Raihan Islam, lawyer and management consultant, commented on the DSA: “If the DSA goes into force based on the proposed language, then any of my clients who have content generated on their websites or their apps (like a community discussion board or other places where users can publish content), there is a possibility the law will apply to them if their business has a connection with the EU.”

Therefore, like the GDPR two years earlier, the DSA will impact not only EU companies but any global enterprises that work with EU clients online.

What exactly does the DSA mean to US lawyers helping US businesses operate in the EU?

Companies will be required to monitor their web content better

The DSA does not create new norms, but rather imposes stricter rules on following the norms that are already in place. All companies — from simple websites to internet infrastructure services and online platforms — will be required to monitor not just the content they publish but also develop procedures that would monitor any content appearing on their platforms.

For instance, social media platforms like Facebook or Instagram would need to come up with better regulation of the content that is being posted by its users. Although Facebook’s users do not communicate on behalf of Facebook, their content is being posted on Facebook’s platform, which puts the company owning the platform more responsible for monitoring and taking down the illegal content. 

As Islam put it: “There are also new obligations for services to provide a better experience for dealing with content notice and takedown requests by third parties, and this might affect how some of my clients manage this process either operationally or through their service. There are risks that their service could be liable in the event they become directly aware of illegal content that they host.”

A lot of work, but no definitive conclusions

The DSA will create a lot of additional work for lawyers and legal consultants, as all businesses that work with the EU citizens will need to update the way they handle, check, and publish any data on their platforms.

Commenting on the actual impact of the act, Islam told Loio: “As it stands, it’s unclear just how complex the obligations will be and whether clear guidance will be published to help non-EU companies. We’ll have to see what the final text will be before it becomes law – none of this is set in stone just yet.”

No need to panic

The American business has a fresh memory of GDPR-induced panic, and many companies are aware that it’s better to start preparing for the updates as soon as possible. The DSA, which is still being discussed and far from becoming an approved piece of legislation, will require companies to invest time and resources to be more careful about their web content. 

As for lawyers, every counsel needs to stay informed and updated about the EU’s further handling of the DSA, and inform their clients ahead of any radical changes are in place. After all, the DSA is not about changing the fundamentals of legal content online, but rather an additional instrument of implementing the rules that already exist.

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