On 4 March, several distinguished speakers from the public and private sector, as well as academia, gathered for ForumEurope’s Second Digital Services Act Conference to discuss key aspects of the European Commission’s proposals, including the role of online marketplaces, online advertising and the functioning of the proposed Digital Markets Act (DMA). One of the keynote speeches was delivered by Gerard de Graaf, Director for Digital Transformation at DG CONNECT. In his talk, he reaffirmed the significance of the DMA and Digital Services Act (DSA), underlining how they will provide the EU’s first single rulebook for digital platforms, much like the frameworks that have been introduced in the past for banks and financial institutions.
In light of the risks posed by major dependencies on external entities and the COVID-19 pandemic, the need for EU regulation to preserve the internal market, following a standardised approach, is greater than ever. Before opening the floor to speakers, De Graaf commented that the DSA will aim to create room for innovative entry, punishing malfeasant behaviour and ensure that regular reviews are conducted by the European Commission so that the instrument is future proof.
The Role of Online Marketplaces
Online Marketplaces and the Know Your Business Customer (KYBC) were one of the central themes of the conference. At the EU level, emphasis was placed on the DSA’s objectives to rectify some of the current problems that customers encounter when shopping online by implementing measures including trusted flaggers, the good Samaritan clause, notice and take down mechanisms and the authentication of providers.
The Commission’s position was challenged by Albert Liu from Alibaba, who explained that while the company supports the KYBC principles and conducts regular screenings, it could not possibly check every product that is sold on the platform. Chanel’s representative Fabienne Weibel expressed her concern towards the growing problem of counterfeiting, which no longer targets luxury products alone. According to Weibel, platforms should have a monitoring obligation and remove products that reappear even after they have been notified as dangerous. During the panel, speakers agreed that the DSA and DMA obligations should not uniquely focus on big players but, on the contrary, basic requirements should be applicable to all platforms regardless of their size.
The Functioning of the Digital Markets Act
After addressing marketplaces, the conference moved to discussing the DMA with a panel that sought to address and represent some of the varied opinions on the debated regulation, with representatives from both private and public sector bodies such as the European Parliament, European Commission, Apple and CERRE. Panellists reflected both their support and concerns for various aspects of the DMA.
MEP Evelyn Gebhardt approved of both the DMA and DSA viewing them as tools to determine a common European view with a holistic and uniform approach. Nonetheless, she underlined that it is important for the DMA to properly define the gatekeeper status, bearing in mind that gatekeepers have diversified their output and services. On this subject, Guillame Loriot of the European Commission noted that the threshold to define gatekeepers is flexible based on adaptable quantitative measuring tools. However, he critiqued the existing DMA proposal, stating that it is too business-focused and does not do enough to protect the consumer.
This concern was shared by Kyle Andrew of Apple, who warned that the DMA could seriously impact services and consumer protection. In particular, DMA’s Article 61c would force gatekeepers to allow installation of third-party software applications regardless of origin, which would pose a danger for consumers and disregard any performance- and safety-curated approaches employed by Apple.
Regulating Online Advertising
As both the DSA and the DMA seek to address the issues around targeted advertising and introduce measures to increase transparency around algorithms, publisher remuneration and ad pricing, a panel of the conference was dedicated to finding the right balance to regulate online advertising. The panel provided a lively discussion between different parties, including the European Commission, the European Parliament, the European Consumer Organisation (BEUC) and representatives of the private sector.
Disagreement arose between Irene Roche Laguna, Head of Unit of Digital Services and Platforms at DG CONNECT, and MEP Tiemo Wölken, member of the European Parliament’s JURI Committee, as well as the Tracking-Free Ads Coalition. Wölken highlighted that the DSA and DMA transparency provisions on advertising, presented by the European Commission, are not sufficient. According to him, the JURI Committee is not satisfied with the current proposal and wishes to see clear rules on accumulation of data, as well as on functioning and accountability. BEUC representative’s David Martin agreed with Wölken’s claims, stating that transparency is not the solution to the problems of online advertising.
IAB Europe CEO’s Townsend Feehan countered the MEP’s call for stronger measures, emphasising that there is already substantial transparency regulation in existing legislation and that people are not forced to agree to tracking. These statements sparked dissent from other panellists who called for greater consumer protection and explained that, while users are not forced to agree to tracking, everything is designed for them to do so and to accept to be profiled.
To sum up, the Second DSA Conference provided excellent panellists from different sectors and backgrounds with the opportunity to discuss contrasting views on the two Commission’s proposals. It showed that, while there are high expectations on the results of both the DSA and DMA, there is still disagreement on their provisions, both between the European Parliament and the European Commission and with the private sector.
