As of 17 February 2024, the Digital Services Act (DSA) applies to all online platforms – large and small – in the European Union. Six months prior to this date, the provisions of the DSA already applied to very large online platforms and search engines (platforms that reach over 45 million users, hereafter called VLOPs and VLOSEs). The European Commission oversees DSA compliance for VLOPs and VLOSEs. Member States had until 17 February 2024 to implement the DSA and designate one or more competent authorities as the Digital Services Coordinator responsible for the implementation and enforcement of the DSA in the Member State.

Here, the Netherlands Authority for Consumers and Markets (ACM) was assigned as the Digital Services Coordinator. But there’s a problem: ACM cannot enforce the DSA because the Dutch draft bill for the Digital Services Act Implementation Act is not yet ready. The Ministry of Economic Affairs and Climate Policy announced in the Government Gazette that it aims to send the draft bill to the House of Representatives ‘as soon as possible’. The Minister of Economic Affairs stated that: ‘The DSA affects national legislation in many different areas and the interests of many different parties. It was therefore not possible to carefully prepare and coordinate the bill with all parties involved within the fifteen months prescribed by the DSA.’ The Minister has established an intermediate remedy so that consumers can already submit their complaints to ACM. However, at this time ACM has no enforcement powers and can only act retroactively once the Implementation Act has entered into force.

The House of Representatives is outraged that the government has not completed its task on time and as a result the bill cannot be implemented. Several MPs have voiced their opinions on this matter and are demanding clarification from the government on when they can expect the draft bill. One of their concerns is the potential bumpy start in relation to enforcement. The longer it takes to implement the Act and the ACM being unable to enforce it immediately, the higher the risk of online violations building up that will need to be addressed retroactively.

Updated online protection under the DSA

The DSA was first proposed in December 2020. As part of the Digital Services Package, it aimed to ensure better protection of the fundamental rights of online users, promote transparency and accountability of online services, as well as ensure an innovative and competitive level playing field for businesses. This update was long overdue, given that the last effort the EU made to manage e-commerce, the e-Commerce Directive, was approximately 20 years (!) ago. The DSA is expected to have considerable impact on Europe’s digital market, as it proposes a plethora of new requirements for online business and consumer behaviour and specifically targets large platforms with strict requirements.

The DSA defines clear responsibilities and accountability for online platforms, such as social media and marketplaces. Platforms must, among other things, tackle illegal content and disinformation and provide transparency about their online marketing practices. For example, stricter transparency requirements were put in place for targeted advertisements and recommender systems (‘you might like…’): users must now be informed about the main parameters used to determine the targeted advertisement or recommendation. Furthermore, platforms may no longer base targeted advertisements on special categories of personal data, such as ethnicity, sexual orientation or political views (Article 26(3) DSA). Minors may not see any targeted advertisements at all (Article 28(2) DSA). This is a major step towards achieving higher transparency and accountability, although it remains to be seen what effects the DSA will have in practice in the area of personalised marketing communication.

The future of the DSA

The content of the DSA is highly promising. It is expected to have considerable impact on how the digital market is shaped, in a way that serves both consumers and companies. Whether it will live up to these expectations remains to be seen. In any case, it would be a great pity if the problems related to enforcement cause the DSA to lose its effectiveness. For now, the European Commission will continue to monitor VLOPs and VLOSEs. The current ‘hiccup’ in the Dutch implementation process does not mean that other online platforms can now do as they please.

Consumers would do well to remain vigilant and make a note of potential violations of the DSA. In that way, as soon as its enforcement powers are in place, the ACM can – hopefully – act accordingly.