The EU’s Digital Services Act

The DSA came into effect last month. It applies specific requirements to ecommerce operators in the EU. The Act defines ecommerce/internet providers into a number of categories. The major platforms (mainly Big Tech) must apply a series of regulations, smaller platforms are expected to reach a lesser level of compliance and internet providers (ISPs and the like) are also required to take some responsibility for the content they carry. The DSA was rushed through in 3 years by the European Commission. It stretches to over 140 pages, which makes it one of the most detailed EU regulations, but the rush to get it adopted has left a number of contradictions and unclear rules which are causing internet companies legal headaches. Major ecommerce companies have pointed out that the Act is fundamentally unfair in that it places requirements on them which are not placed on bricks and mortar retailers. A vast majority of the estimated 10,000 smaller platforms in the EU, on the other hand, remain blissfully ignorant of the new requirements they face. The Act sets up a regulator with impressive powers to fine or apply desist orders.

Policymakers have spent years designing laws and regulations to go after Big Tech. But they were not prepared for the rise of decentralized alternatives—from cryptocurrencies and NFTs on the blockchain to microblogging services like Mastodon and video streaming services like PeerTube. These services focus on decentralizing common online services to provide users with peer-to-peer alternatives to “Big Tech.” Advocates of decentralized services believe they will give users more choice over what rules they follow, what content they see, and what personal data they share—potentially improving free speech, user safety, and data privacy. But policymakers have mostly designed Internet regulations for centralized services. Recent laws, including the DSA and the Online Safety Bill, provide more questions than answers on how they would potentially affect decentralized platforms.