The EU Digital Services Act (DSA) came into force on 17 February 2024. One of the key objectives of the new legislation is to ensure greater transparency in the area of online services, as well as to better protect users of such services. The DSA imposes obligations on intermediate service providers (internet intermediaries). This particularly applies to intermediaries of online content posted by others (users). However, Internet service providers who make their own (or licensed) content available online (content providers) are not covered by the provisions of the DSA. Certain provisions of the DSA applying to intermediate service providers do not apply to providers that qualify as micro or small entrepreneurs.

What is the qualification of an online shop under the DSA?

Typical online shops do not, in principle, classify as entities operating under the intermediary services model within the meaning of the DSA. The case is different for online trading platforms (marketplace). However, this does not mean that service providers running online shops do not have to worry about the DSA at all. While a typical online shop as a whole or its individual functionalities do not, in principle, classify as an online platform service, certain functionalities of the shop may fall under the definition of a hosting service (e.g. functionality allowing the posting of reviews of the products sold).

Product reviews

Reviews of products or services available in online shops are usually provided by users (third parties in relation to the service provider). This meets the definition of a hosting service within the meaning of the DSA (storage of information provided by and at the request of the service recipient).

Only hosting services that at the same time constitute information society services are covered by the scope of the DSA. A criterion for classifying a given service as an information society service is that the service in question is ‘normally provided for remuneration’. However, it is sufficient that the service in question is of a broadly economic nature (it is not necessary that the user pays for the use of the service). Product reviews posted on online shops have an economic value for the service provider, as they can increase the sales.

What about an exemption for so-called ancillary features?

The definition of an online platform contained in the DSA excludes from the definition of an online platform features of a service that, while allowing the public dissemination of user content, only constitute “an insignificant or solely ancillary feature of another service or an insignificant function of the main service, and for objective and technical reasons cannot be used without such other service”. Standard product reviews fall within the scope of this exemption, which means that this feature should not be classified as an online platform service (this, however, does not affect its definition as a hosting service).

What about cases when an entrepreneur uses external software?

The use of external technical infrastructure to enable the posting of reviews on the online shop does not affect the fact that the online shop provider is a hosting provider within the meaning of the DSA.

What does this mean in practice for online shops?

Service providers running online shops should comply with the requirements set out in the DSA. This also applies to micro and small entrepreneurs. The requirements mainly include:

  • appointment of contact points,
  • publication of reports on the moderation of user content,
  • implementation of a mechanism enabling electronic reporting of illegal content (notice-and-action),
  • adaptation of the terms of service (content moderation policy, e.g. with respect to product reviews). 

Penalties for non-compliance with the DSA

The DSA sets out the maximum penalties for breaches of obligations thereunder. An example of a breach is a failure to align the terms of use with the requirements provided for in the DSA (e.g. a failure to indicate in the terms of use what sanctions the service provider may impose on users who transmit content that does not comply with the law or the terms of service. The maximum fine for failure to comply with the obligation set out in the DSA may amount to 6% of the annual worldwide turnover of the intermediate service provider in question in the previous financial year.