EP IMCO Committee published Draft Initiative Report on Digital Services Act

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On 15 April, the European Commission got a first view on the wish list of the European Parliament for the upcoming Digital Services Act (DSA) Package. Maltese Member of the European Parliament (MEP) Alex Agius Saliba (IMCO, S&D), rapporteur of the Digital Services Act (DSA) file, published his Draft Initiative Report on the DSA. The Initiative Report is a non-binding parliamentary instrument but carries political weight and gives a good idea of the position of the European Parliament on the matter it deals with. The Commission is not required to take legislative action following the report, but will likely consider it in their drafting process.

An important request from MEP Saliba is that the new Digital Services Act should maintain the main principles of the e-Commerce Directive (ECD) of 2000, namely the Country of Origin principle, the freedom establishment and the prohibition of imposing a general monitoring obligation on platforms. The report calls for the addition of some new guiding principles for the future regulatory framework, in particular “what is illegal offline is also illegal online”, as well as the principles of consumer protection and user safety. Relevant in particular is that the EP IMCO’s draft initiative report calls for the maintenance of the current logic of the liability safe harbor for the digital platforms that is covered by the ECD. In short, the safe harbor principle entails that an intermediary is not liable for illegal content on its platform if it was not aware of the illegality or, when it becomes aware of it, it acts expeditiously to remove or block access to the illegal content.

Other key demands from MEP Saliba are that companies which are not established in the EU, but provide services to EU consumers, should also be covered by the DSA. In addition, Saliba calls for the establishment of a central regulatory authority responsible for the oversight and compliance with the Digital Services Act and the introduction of a “Know Your Business Customer” principle for service providers to verify the identity of business partners.

In addition, according to the draft report, the DSA package should also include an ex-ante mechanism to prevent unfair market behavior by “systemic platforms” in the digital world, building on the existing Platform-to-Business Regulation as well as a separate instrument to address social protection and rights of platform workers.

The Rapporteur proposes to use an approach to build the DSA upon the rules that are already applicable to digital services, namely the ECD and the Platform-to-Business Regulation. The consideration of the Draft Initiative Report by IMCO MEPs is currently scheduled to take place on 4 May, but this could be postponed due to the COVID-19 crisis. The deadline for IMCO Shadow Rapporteurs to table amendments is 12 May. Due to the outbreak of the Coronavirus, the consultation on the Digital Services Act will most likely be postponed to May 2020 and the legislative proposal will be delayed to the first quarter of 2021.

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