The European Union Digital Service Act (DSA) came into force in November 2022 and will be directly applicable across the EU from 17th February 2024. Although some provisions became applicable upon passage of the Act, it builds on the rules of the e-Commerce Directive of 2000 and seeks to address emerging issues relating to online intermediaries.
It was enacted to create a safer digital space in which the fundamental rights of all users of digital services are protected, particularly, rules relating to the due diligence obligations of certain categories of providers of online platforms. Accordingly, the act places specific focus on very large online platforms and online search engines reaching at least 45 million users in the EU. The DSA is applicable to all online services offered to EU residents irrespective of where the providers of those online platforms have their place of establishment.
This article sets out the major highlights of the DSA and learnings that may be adopted for the purposes of tackling similar issues in Nigeria.
Highlights of the DSA
Conditional Exemption from Liability: The DSA introduces conditions on the liability exemption of online platforms intermediating between consumers and traders. The conditions for benefiting from the liability exemption include:
The transmission not being initiated by providers of online platforms.
The provider of the online platform does not select the receiver of the transmission.
The provider of the online platform does not select or modify the information contained in the transmission.
The provider of the online platform does not have actual knowledge of illegal activity or illegal content and, as regards any claims for damages, is not aware of the facts or circumstances from which the illegal activity or illegal content is apparent.
Upon obtaining such knowledge or awareness, acts expeditiously to remove or disable access to the illegal content among others.
However, the provider of an online platform would become liable if it causes an average consumer to consider that the object of the transaction is provided directly by its platform or by a user under his authority or control.
The provider of an online platform will not be deemed ineligible from the conditional exemption from liability solely because in good faith and in a diligent manner it engages in voluntary investigations or other initiatives for detecting, identifying and removing, or disabling access to, illegal content.
Providers of online platforms are also required to designate a single point of contact to ease communication and to enable recipients of the services to communicate rapidly and directly with them. Providers of online services who do not have an establishment but offer services in the E.U. are required to designate in writing a legal or natural person to act as their legal representative in one of the countries where they offer services.
Read also: Navigating legal issues in supply chain management for FMCGs
Content Moderation: Providers of online platforms are required to, in clear and unambiguous language, provide information in their terms and conditions on the content moderation activities undertaken on their platforms, with due regard to the rights and legitimate interests of all parties.
Illegal content and criminal activities notification: The DSA reinforces the need for service providers to set up a “notice-and-action” mechanism through which any individual or entity can notify them of the presence on their services of specific pieces of content that they consider illegal and the duty of the service provider to without undue delay confirm receipt of the notice
Similarly, measures and protection against misuse and unfounded complaint are set out in Article 23 of the DSA. The DSA introduces mechanisms through which users can flag illegal content online; how notices submitted by trusted flaggers are to be treated with priority and without delay; the criteria to become a trusted flagger, and how to treat a trusted flagger who has provided insufficiently precise or inadequately substantiated notice.
Grievance/dispute resolution mechanism and remedies: The DSA sets out essential safeguards that will enable individuals to have access to effective remedies where a dispute arises if they restrict user-generated content, they will be obliged to provide a statement of reason to explain what type of action was taken and on what basis.
The DSA establishes a three-tier grievance mechanism as follows:
Internal complaint-handling system to be provided by providers of the online platforms free of charge.
Out-of-court dispute settlement which require certified out-of-court dispute settlement bodies to make their decisions available to the parties within a reasonable period of time and no later than 90 calendar days after the receipt of the complaint.
Judicial redress
Targeted adverts and profiling: The DSA obliges all online platforms to disclose the parameters of their content recommender systems, in plain and intelligible language. Importantly, people will have the right to modify content recommender systems.
The DSA introduces new obligations on the provider of online services by ensuring that children and young people have safer experiences online. This provision comes at a time of increasing global concern about the impact and effects new technologies have on children and young people’s safety and well-being.
The DSA is applicable to all online services offered to EU residents irrespective of where the providers of those online platforms have their place of establishment.
Due diligence and traceability of traders: Providers of online platforms are to allow consumers and traders to make use of their platforms only where information identifying the trader (such as details of the trader, payment account details, register number and a self-certification) have been provided and verified. This would help to build trust, hopefully, reducing scams and protecting users online.
The DSA further imposes due diligence obligations on Very Large Online Platforms which include a mandatory risk assessment, deployment of mitigation of risk measures and obligation to subject themselves to independent audits to be conducted on a yearly basis at their own expense to assess their level of compliance.
The DSA provides for an enforcement mechanism and each member state of the E.U is required to clearly specify the penalties in their national laws for non-compliance. Failure to comply with an obligation shall be a maximum fine of 6% of the annual worldwide turnover of the infringing provider concerned in the preceding financial year. Failure to supply correct, complete, or accurate information, or rectify incorrect, or misleading information or submit to an inspection shall be a maximum amount of 1% of the annual income or worldwide turnover of the infringing provider concerned in the preceding financial year.
Applicability
Nigerian entities that are digital service providers/platforms and are targeting users established or resident in the E.U., will most likely be impacted by the DSA.
For Nigerian service providers/platforms targeting the E.U, they must comply with the following:
Service providers will have to establish new features to remove hate speech and online terrorist propaganda.
Service providers will need to have ‘notice and action’ procedures that are accessible and user-friendly, with obligations to react quickly, while respecting fundamental rights.
Simpler reporting mechanisms will need to be put in place for users and consumers to complain about online content. In addition, users that feel that their content has been unfairly removed should be able to access the grievance/complaint process.
Ensure there is greater transparency on online marketplace information (e.g., including the identification and traceability of sellers and products).
Take steps towards protecting minors during their accessibility to online platforms including fully banning targeted advertising.
Prioritize notices filed by trusted flaggers of content as designated under the DSA
What’s next for Nigeria?
Nigeria, like most countries, has the same concerns as the E.U. as it relates to regulating the digital space, rights, and freedom of users, particularly freedom of expression. Various attempts at regulating the social media space, online platforms and intermediaries are always met with suspicion and public outcry. What is, however, incontestable is the fact that the time is ripe for some sort of regulation which should balance the concerns that have been expressed by various stakeholders.
Like the General Data Protection Regulation (GDPR), there is no need to reinvent the wheel to address a matter that is of global concern and has received focused and well-thought-out legislation. The draft Code of Practice for Interactive Computer Service Platforms/Internet Intermediaries issued by NITDA in June 2022 which was an attempt to address the same concerns of the DSA did not receive the necessary wide acceptability by stakeholders. The DSA has however provided a template for serious consideration and localization and an opportunity for Nigeria to take another look at finding a fair and acceptable instrument for balancing the competing interests.
ADVOCAAT Impact is an initiative of ADVOCAAT Law Practice.
Advocaat Law Practice is a full-service commercial law firm with offices in Lagos and Abuja, comprised of four seasoned partners and 11 associates.
Assisting our clients to attain their objectives is at the core of our values. We proffer the highest quality service by expertly tailoring legal advice to our clients’ needs in various sectors of the West African economy, through hard work, a shared team spirit and diligence.
Contact us: www.advocaat-law.com; @advocaatlawpractice on LinkedIn; email:[email protected]
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
