Europe’s Digital Future: The Impact of Digital Regulations on Online Service Providers

Twenty years after the e-Commerce directive, the EU has significantly increased the number of regulations impacting online service providers. From the Digital Single Market Strategy in 2015 to the Commission’s vision for a digital transformation by 2030, the EU’s objective has been to create an environment where digital networks and services can prosper, and that citizens, businesses, and the larger civil society can benefit from the same. As part of these various strategies, the EU has passed multiple regulations and directives in the last five years, and has many more pieces of legislation to be implemented in the coming years, that impact content on digital platforms. 

If you are an online service provider, the following regulations can directly or indirectly impact you:

 

Digital Regulations on Online Service Providers

Timeline of European regulations concerning the digital single market
Regulation Type Date Aim Penalty
E-Commerce Directive Directive 2000
  • Remove obstacles to cross-border online services in the EU market and enhance competitiveness of European service providers.
  • States that OSPs cannot be held liable for third party illegal content.
Enforcement, penalties and sanctions vary from one member state to another.
Code of Conduct on Hate Speech Voluntary Code 2016 Prevent and counter the spread of illegal hate speech online. N/A
Code of practice on disinformation Voluntary Code 2018 Commitments such as transparency in political advertising and closure of fake accounts, to demonetisation of
purveyors of disinformation.
N/A
General Data Protection Regulation (GDPR) Regulation 2018

Protect user’s personal data.

Restrict non-consensual processing and movement of data.

Facilitate business in the digital single market.

20 000 000 EUR or 4% of the firm’s worldwide annual revenue.
Directive on copyright and related rights in the Digital Single Market Directive 2019

Ensure fairer renumeration for creators and rightsholders, press publishers and journalists, in particular when their works are used online.

Obligations include obtaining authorisation from rightsholders for content uploaded on the platforms of online content sharing providers.

Enforcement, penalties and sanctions vary from one member state to another.
Audiovisual media services directive (AVMSD) Directive 2020

Provides EU-wide media content standards for all audio-visual media, including video-sharing platforms.

Protection of minors against harmful content and reinforced protection against incitement to violence or hatred.

Enforcement, penalties and sanctions vary from one member state to another.
Promoting fairness and transparency for business users of online intermediation services Regulation 2020

Ensure that users are granted appropriate transparency, fairness, and effective redress possibilities.

Applies to online intermediation services and online search engines.

Member states shall ensure that effective, dissuasive, and proportionate penalties are applied to infringements.
Terrorist Content Online Regulation Regulation 2022 Ensure that hosting service providers take down identified terrorist content within an hour following a removal order from relevant authorities. 4% of the platform’s annual turnover.
Digital Services Act Regulation 2023**

Establish transparency and accountability frameworks for platforms, and encourage innovation, growth and competition within the European market.

Obligations include measures to counter illegal goods, services, or content online, and trace sellers of illegal goods.

Audit and transparency measures as well as complaint mechanisms to be implemented.

6% of platform’s annual global turnover.

Platforms that refuse to comply can be taken to court and given a temporary suspension.

Data Governance Act Regulation 2023*

Outlines rules on who can use and access data generated in the EU.

Applies to businesses, consumers, and the public sector.

Facilitates data sharing across sectors and member states.

Administrative fines: 4% of total worldwide annual turnover or 20 000 000 EUR.

Member states can also implement additional penalties.

Proposal for regulation on General Product Safety Regulation 2024*

Address product safety challenges.

Enhance market surveillance of dangerous products in the EU.

Increase protection of EU consumers.

4% of the economic operator’s or online marketplace’s annual turnover.

Member States may choose to impose periodic penalty payments.

Proposal for regulation on AI Regulation 2024*

Ensure that AI practices and systems in the market are safe and respect existing law, values, and fundamental rights.

Establishes a list of prohibited AI systems whose use is considered unacceptable.

Applies to providers of AI systems, users, and other participants across the AI value chain.

Non-compliance: 30 000 000 EUR or 6% of total worldwide annual turnover.

Supply of incorrect, incomplete, or misleading information: 10 000 000 EUR or 2% of total worldwide annual turnover.

Proposal for Regulation laying down rules to prevent and combat child sexual abuse Regulation 2025*

Combat child sexual abuse material (CSAM) online with obligations for online service providers to detect, report, and remove CSAM from their services.

Obligations include mandatory risk assessment and risk mitigation measures, reduction of exposure to grooming, proactive content detection, effective removal, reporting obligations, data collection and transparency obligations, and single point of contact.

6% of the annual income or global turnover of the provider.
*The marked dates refer to proposed dates of implementation.
** The DSA is applicable for very large online platforms from 2023 and all other online services from 2024.

Code of Conduct: Voluntary initiatives that establish self-regulatory standards to achieve an objective.

Directive: Requires EU countries to achieve certain objectives but gives the country flexibility in how they choose to do so. Countries must incorporate directives into national law.

Regulation: Legal acts that apply automatically and uniformly to all EU countries as soon as they are in force, without needing to be transposed into national law. They are binding in their entirety on all EU countries.

 

The acceleration of legislation passed over the last few years, as well as the multiple that are under development, are indicative of the rapidly changing expectations of different stakeholders in the digital environment. The pace of legislation does not seem to slow down and, within a dynamic environment like the internet, issues of trust & safety and compliance become even more important and relevant.

More importantly, for businesses, this creates a new and increasingly complex environment to navigate. As new obligations emerge, Tremau is committed to helping online platforms steer through the European legal ecosystem by facilitating their understanding of how such laws impact their business and operational models, and providing them with the solutions to ease their compliance efforts.

To find out more about how the TCO will impact you, contact us at info@tremau.com

Building a safe and compliant digital world

info@tremau.com

© Copyright 2022, Tremau