La proposta europea di regolamentare i servizi digitali

EXPLANATORY MEMORANDUM

1.CONTEXT OF THE PROPOSAL

•Reasons for and objectives of the proposal

In doing so, the Commission has taken account of the issues identified in the European Parliament’s own initiative reports and analysed the proposals therein. The European Parliament adopted two resolutions on the basis of Article 225 of the Treaty on the Functioning of the European Union (TFEU) on the ‘Digital Services Act – Improving the functioning of the Single Market’ 3 and on the ‘Digital Services Act: adapting commercial and civil law rules for commercial entities operating online’ 4 . The European Parliament also adopted a resolution under the non-legislative procedure on the ‘Digital Services Act and fundamental rights issues posed’ 5 . In substance, the resolutions are complementary in many aspects. They include a strong call for maintaining the core principles of the e-Commerce Directive and for protecting fundamental rights in the online environment, as well as online anonymity wherever technically possible. They call for transparency, information obligations and accountability for digital services providers and advocate for effective obligations to tackle illegal content online. They also advocate for public oversight at EU and national level, and cooperation between competent authorities across jurisdictions in enforcing the law, especially when addressing cross-border matters.

The resolution on ‘Digital Services Act – Improving the functioning of the Single Market’ calls for an ambitious reform of the existing EU e-commerce legal framework while maintaining the core principles of its liability regime, the prohibition of general monitoring and the internal market clause, which it considers to be still valid today. Confirming the objectives of the e-Commerce Directive, the resolution calls for measures which have consumer protection at their core, by including a detailed section on online marketplaces, and which ensure consumer trust in the digital economy, while respecting users’ fundamental rights. The resolution also advocates for rules to underpin a competitive digital environment in Europe, and envisages the Digital Services Act as a standard-setter at global level.

The resolution on ‘Digital Services Act: adapting commercial and civil law rules for commercial entities operating online’ calls for more fairness, transparency and accountability for digital services’ content moderation processes, ensuring that fundamental rights are respected, and guaranteeing independent recourse to judicial redress. The resolution also includes the request for a detailed ‘notice-and-action’ mechanism addressing illegal content, comprehensive rules about online advertising, including targeted advertising, and enabling the development and use of smart contracts.

•Consistency with existing policy provisions in the policy area

Depending on the legal system of each Member State and the field of law at issue, national judicial or administrative authorities may order providers of intermediary services to act against certain specific items of illegal content. Such orders, in particular where they require the provider to prevent that illegal content reappears, must be issued in compliance with Union law, in particular with the prohibition of general monitoring obligations, as interpreted by the Court of Justice of the European Union 8 . This proposal, in particular its Article 8, leaves this case-law unaffected. This proposal should constitute the appropriate basis for the development of robust technologies to prevent the reappearance of illegal information, accompanied with the highest safeguards to avoid that lawful content is taken down erroneously; such tools could be developed on the basis of voluntary agreements between all parties concerned and should be encouraged by Member States; it is in the interest of all parties involved in the provision of intermediary services to adopt and implement such procedures; the provisions of this Regulation relating to liability should not preclude the development and effective operation, by the different interested parties, of technical systems of protection and identification and of automated recognition made possible by digital technology within the limits laid down by Regulation 2016/679.

•Consistency with other Union policies

The proposed Regulation introduces a horizontal framework for all categories of content, products, services and activities on intermediary services. The illegal nature of such content, products or services is not defined in this Regulation but results from Union law or from national law in accordance with Union law.

Sector-specific instruments do not cover all the regulatory gaps evidenced in the impact assessment report: they do not provide fully-fledged rules on the procedural obligations related to illegal content and they only include basic rules on transparency and accountability of service providers and limited oversight mechanisms. In addition, sector-specific laws cover situations where adapted approaches are necessary. In terms of scope, they are limited from two perspectives. First, the sector-specific interventions address a small subset of issues (e.g. copyright infringements, terrorist content, child sexual abuse material or illegal hate speech, some illegal products). Second, they only cover the dissemination of such content on certain types of services (e.g. sub-set of online platforms for copyright infringements, only video-sharing platforms and only as regards audiovisual terrorist content or hate speech). However, it is important that the relationship between the new proposed Regulation and the sector-specific instruments is clarified.

This proposal is without prejudice to the Regulation (EU) 2016/679 (the General Data Protection Regulation) and other Union rules on protection of personal data and privacy of communications. For example, the measures concerning advertising on online platforms complement but do not amend existing rules on consent and the right to object to processing of personal data. They impose transparency obligations towards users of online platforms, and this information will also enable them to make use of their rights as data subjects. They also enable scrutiny by authorities and vetted researchers on how advertisements are displayed and how they are targeted.

This proposal will be complemented by further actions under the European Democracy Action Plan COM(2020) 790 final, with the objective of empowering citizens and building more resilient democracies across the Union. In particular, the rules on codes of conduct established in this Regulation could serve as a basis and be complemented by a revised and strengthened Code of practice on disinformation, building on the guidance of the Commission.

The proposal is also fully consistent and further supports equality strategies adopted by the Commission in the context of the Union of Equality. The proposal is without prejudice to the Commission’s initiative aimed at improving the labour conditions of people working through digital platforms.

Finally, the proposed regulation builds on the Recommendation on illegal content of 2018. 9 It takes account of experiences gained with self-regulatory efforts supported by the Commission, such as the Product Safety Pledge 10 , the Memorandum of Understanding against counterfeit goods 11 , the Code of Conduct against illegal hate speech 12 , and the EU Internet Forum with regard to terrorist content.

2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY

•Legal basis

The legal basis for the proposal is Article 114 of the Treaty on the Functioning of the European Union, which provides for the establishment of measures to ensure the functioning of the Internal Market.

The primary objective of this proposal is to ensure the proper functioning of the internal market, in particular in relation to the provision of cross-border digital services (more specifically, intermediary services). In line with this objective, the proposal aims to ensure harmonised conditions for innovative cross-border services to develop in the Union, by addressing and preventing the emergence of obstacles to such economic activity resulting from differences in the way national laws develop, taking into account that several Member States have legislated or intend to legislate on issues such as the removal of illegal content online, diligence, notice and action procedures and transparency. At the same time, the proposal provides for the appropriate supervision of digital services and cooperation between authorities at Union level, therefore supporting trust, innovation and growth in the internal market.

•Subsidiarity

Taking into account that the Internet is by its nature cross-border, the legislative efforts at national level referred to above hamper the provision and reception of services throughout the Union and are ineffective in ensuring the safety and uniform protection of the rights of Union citizens and businesses online. Harmonising the conditions for innovative cross-border digital services to develop in the Union, while maintaining a safe online environment, can only be served at Union level.

Union level action provides predictability and legal certainty, and reduces compliance costs across the Union. At the same time, it fosters the equal protection of all Union citizens, by ensuring that action against illegal content online by providers of intermediary services is consistent, regardless of their place of establishment. A well coordinated supervisory system, reinforced at Union level, also ensures a coherent approach applicable to providers of intermediary services operating in all Member States.

•Proportionality

The proposal seeks to foster responsible and diligent behaviour by providers of intermediary services to ensure a safe online environment, which allows Union citizens and other parties to freely exercise their fundamental rights, in particular the freedom of expression and information. Key features of the proposal limit the Regulation to what is strictly necessary to achieve those objectives.

In particular, the proposal sets asymmetric due diligence obligations on different types of digital service providers depending on the nature of their services and their size, to ensure their services are not misused for illegal activities and providers operate responsibly. This approach addresses certain identified problems only there where they materialise, while not overburdening providers unconcerned by those problems. Certain substantive obligations are limited only to very large online platforms, which due to their reach have acquired a central, systemic role in facilitating the public debate and economic transactions. Very small providers are exempt from the obligations altogether.

As regards digital service providers established outside of the Union offering services in the Union, the Regulation requires the appointment of a legal representative in the Union to ensure effective oversight and, where necessary, enforcement.

Proportionate to the obligations, and taking into account the cross-border nature of digital services, the proposal will introduce a cooperation mechanism across Member States with enhanced Union level oversight of very large online platforms. Additionally, the proposal does not amend sector-specific legislation or the enforcement and governance mechanisms set thereunder, but provides for a horizontal framework to rely on, for aspects beyond specific content or subcategories of services regulated in sector-specific acts.

•Choice of the instrument

3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS

•Ex-post evaluations/fitness checks of existing legislation

This proposal builds on the evaluation of the e-Commerce Directive, conducted as a ‘back to back’ evaluation with the Impact Assessment accompanying the proposal. The specific objectives of the e-Commerce Directive were to ensure (i) a well-functioning internal market for digital services, (ii) the effective removal of illegal content online in full respect of fundamental rights, and (iii) an adequate level of information and transparency for consumers.

As regards the effectiveness of the e-Commerce Directive, the evaluation shows that while the e-Commerce Directive has provided an important incentive for the growth of the internal market for digital services, and enabled entry and scaling up of new providers of such services, the initial objectives have not been fully achieved.

In particular, the dynamic growth of the digital economy and the appearance of new types of service providers raises certain new challenges, dealt with differently by Member States, where the initial set of objectives need to be clarified. In addition, these developments put an additional strain on achieving already existing objectives as the increased legal fragmentation shows.

The evaluation also showed that while several new regulatory instruments make valuable contributions to the attainment of some of the policy objectives set out in the e-Commerce Directive, they provide only sector-specific solutions for some of the underlying problems (e.g. in addressing the proliferation of specific types of illegal activity). They therefore do not address such issues consistently for the entire digital ecosystem, as they are limited to certain types of services or certain types of illegal content. Furthermore, while self-regulatory initiatives have generally shown positive results, they cannot be legally enforced, nor do they cover all participants in the digital economy. As regards the efficiency of the e-Commerce Directive, the Directive imposed only limited additional costs for Member States' administrations and providers of information society services. The evaluation has not revealed particularly high or disproportionate costs and no substantial concerns have been raised regarding impacts on small and medium-sized enterprises. The main concern in this regard is related to the lack of clarity in the cooperation mechanism across Member States, creating burdens and duplication of costs, despite the opposite objective of the Directive, in particular where the supervision of online platforms is concerned. This has essentially reduced its efficiency in maintaining the functioning of the internal market.

In relation to questions about the continued relevance of the objectives pursued by the e-Commerce Directive, the evaluation shows that the objectives of the e-Commerce Directive continue to remain valid, while at the same time there are several new developments that are not well reflected in the existing public policy objectives.

First, the open public consultation, targeted submissions by stakeholders, reports issued by the European Parliament 13 as well as Council conclusions 14 confirm that the existing principles and objectives of the e-Commerce Directive remain valid today. However, new information asymmetries and risks have arisen since the entry into force of the Directive, notably related to the emergence of online platforms, in particular very large ones, and the scale of the digital transformation. This is for example the case in the areas of algorithmic decision making (with an impact on how information flows are intermediated online), or in online advertising systems.

The evaluation showed that the e-Commerce Directive is coherent with other EU interventions that took place since its adoption. The evaluation also did not identify any internal in-coherence of the e-Commerce Directive.

Finally, at least parts of the actual benefits of the e-Commerce Directive that the evaluation identified could be considered as EU added value. It is likely that Member States would have continued applying their own regulatory systems without any common set of principles and that some Member States would have continued to have no horizontal rules in place at all. In the absence of robust evidence, it is however not possible to draw firm conclusions on the extent of this EU added value.

•Stakeholder consultations

Over the past five years, the Commission has consulted a wide range of different stakeholders, including providers of digital services such as online platforms and other intermediary services, businesses trading online, media publishers, brand owners and other businesses, social partners, users of digital services, civil society organisations, national authorities, academia, the technical community, international organisations and the general public. An array of targeted consultation steps have captured thoroughly stakeholder views on issues related to digital services and platforms over the last years.

The open public consultation on the Digital Services Act was open for 14 weeks, between 2nd of June and 8th of September and received 2,863 responses and around 300 position papers from a diverse group of stakeholders. Most feedback was submitted by the general public (66% from Union citizens, 8% from non-EU citizens), companies/ businesses organizations (7.4%), business associations (6%), and NGOs (5.6%). This was followed by public authorities (2.2%), academic/research institutions (1.2%), trade unions (0.9%), and consumer and environmental organisations (0.4%).

Overall, there is a general agreement amongst stakeholders for a need for action, both in addressing online safety and in furthering the internal market for digital services.

Stakeholders converge on the continued relevance of the main principles of the e-Commerce Directive and agree that they should be maintained, including the internal market principle for the supervision of digital services, the liability regime, and the prohibition of general monitoring obligations.

Stakeholders also broadly agree on the need to upgrade the framework in light of today’s challenges by establishing clear obligations for service providers, harmonised across the EU. A majority of respondents, all categories included, indicated that they have encountered both harmful and illegal content, goods or services online, and specifically noted an alarming spike during the Covid-19 pandemic. A large share of respondents who say they have notified illegal content or goods to digital service providers expressed their dissatisfaction with the response and the ineffectiveness of reporting mechanisms after the exposure took place. Moreover, users perceive there to be a mismatch between providers’ policies as stated and their concrete actions.

There is broad consensus, including among service providers responding to the consultation, on the need for simple, standardised, transparent notice and action obligations, harmonised across the internal market. This is considered as essential to enable rapid responses to illegal content and enhance legal clarity for users of platforms and for small platforms seeking to scale in the internal market. Respondents also agree on the importance of a redress mechanisms.

Concerning online marketplaces, several stakeholders flagged the need for more targeted measures such as the identification of sellers.

Respondents also generally agree that the territorial scope for these obligations should include all players offering goods, information or services in the Union, regardless of their place of establishment. A large share of respondents also emphasized the importance of these issues in particular where large platforms are concerned.

There is a general agreement among stakeholders that ‘harmful’ (yet not, or at least not necessarily, illegal) content should not be defined in the Digital Services Act and should not be subject to removal obligations, as this is a delicate area with severe implications for the protection of freedom of expression.

However, the way algorithmic systems shape information flows online is an area of concern among a wide category of stakeholders. Several stakeholders, in particular civil society and academics, pointed out the need for algorithmic accountability and transparency audits, especially with regard to how information is prioritized and targeted. Similarly, regarding online advertising, stakeholder views echoed the broad concerns around the lack of user empowerment and lack of meaningful oversight and enforcement.

•Collection and use of expertise

•Impact assessment

The Regulatory Scrutiny Board issued a positive opinion with reservations on the impact assessment, including suggestions for improvement 21 . The Impact Assessment report was further revised along these lines, notably in clarifying the interlinks between the Digital Services Act and the broader regulatory framework, providing more detailed descriptions of the policy options, and a more detailed analysis of the underlying evidence addressed in the revised impact assessment report.

The importance in our economy and society, but also the growing risks brought by digital services will continue to scale. In the baseline scenario, the Commission will continue to enforce existing rules, including on sector-specific issues, and will support the self-regulatory efforts in place. However, faced with the evolving problems, Member States will continue to legislate independently. The legal fragmentation with the resulting patchwork of national measures will not just fail to effectively tackle illegal activities and protect citizens’ fundamental rights throughout the EU, it will also hinder new, innovative services from scaling up in the internal market, cementing the position of the few players which can afford the additional compliance costs. This leaves the rule setting and enforcement mostly to very large private companies, with ever-growing information asymmetry between online services, their users and public authorities.

Three main policy options were assessed, in addition to the baseline. Option 1 would codify the Recommendation of 2018: it would lay down a range of procedural obligations for online platforms to tackle illegal activities conducted by their users. The obligations would also include the necessary safeguards in order to protect users’ fundamental rights and ensure transparency. It would also enhance the administrative cooperation mechanisms for authorities to resolve cross-border issues through a digital clearing house, facilitating information flows. Option 2 would in addition to measures in option 1, remove disincentives for service providers to take voluntary measures against illegal content, and introduce measures to enhance transparency around recommender systems and advertising. The enforcement and cooperation mechanism would be enhanced with the appointment of a central coordinator in each Member State. Option 3, building on the measures outlined in the previous options, includes targeted, asymmetric measures with stronger obligations for very large online platforms which are prone to the highest levels of risks for the EU society and economy, as well as certain limited clarifications of the liability regime for providers of intermediary services and an EU governance system with reinforced oversight and enforcement powers.

The assessment of the economic and social impacts identified, and the comparison of its effectiveness, efficiency, coherence and proportionality showed that Option 3 would most effectively meet the objectives of the intervention by establishing the proportionate framework fit for adapting to emerging challenges in the dynamic digital world. The components included in Option 3 are also broadly supported by stakeholders, including positions from the European Parliament and Member States.

The preferred option would support the access to the internal market for European Union intermediary service providers and their ability to scale-up by reducing costs related to the legal fragmentation. While costs for compliance with due diligence obligations are expected, it is estimated this is offset by reducing the current fragmentation through harmonisation. It is expected to have a positive impact on competitiveness, innovation and investment in digital services, in particular European Union start-ups and scale-ups offering platform business models but also, to varying extents, on sectors underpinned and amplified by digital commerce.

The preferred option intends to define the appropriate division of responsibilities between intermediary services, their recipients and authorities when fighting against illegal content online. To do so, it introduces an asymmetric approach to the due diligence obligations imposed on very large online platforms: this is a supervised risk management approach, with an important role of the governance system for enforcement. The asymmetric obligations are only imposed on very large online platforms, which have, based on the current data, not only the broadest reach, but are also the large companies with important turnover. Consequently, while the targeted measures are more restrictive than for other companies, they are proportionate to the ability of the companies to comply.

For public authorities, the proposed option would cut the costs brought by the inefficiencies and duplications in the existing set-up for the cooperation of authorities. While Member States would bear the costs of appointing a competent authority, new or already established, the efficiency gains are expected to outweigh them: for the individual authorities through mutualisation of resources, better information flows, and straight-forward processes for interacting with their counterparts across the internal market, as well as with service providers.

•Regulatory fitness and simplification

The Impact Assessment accompanying this proposal identifies the sole added value of Union intervention addressing the risk of legal fragmentation triggered by divergent regulatory and supervisory approaches (hence without accounting for the increased safety and trust on digital services) in a possible increase of cross-border digital trade of 1 to 1.8%, i.e. the equivalent of an increase in turnover generated cross-border of EUR 8.6 billion and up to EUR 15.5 billion.

With regard to added value in the enforcement of measures, the initiative creates important efficiency gains in the cooperation across Member States and mutualising some resources for technical assistance at EU level, for inspecting and auditing content moderation systems, recommender systems and online advertising on very large online platforms. This, in turn, leads to an increased effectiveness of enforcement and supervision measures, whereas the current system relies to a large extent on the limited capability for supervision in a small number of Member States.

•Fundamental rights

4.BUDGETARY IMPLICATIONS

The budgetary impact of the proposal will be covered by the allocations foreseen in the MFF 2021-27 under the financial envelopes of the Digital Europe Programme and Single Market Programme as detailed in the legislative financial statement accompanying this proposal for a regulation.These implications require also reprogramming of Heading 7 of the Financial Perspective.

The legislative financial statement accompanying this proposal for a Regulation covers the budgetary impacts for the Regulation itself.

5.OTHER ELEMENTS

•Implementation plans and monitoring, evaluation and reporting arrangements

The Commission will establish a comprehensive framework for continuously monitoring the output, results and impact of this legislative instrument upon the date of its application. Based on the established monitoring programme, an evaluation of the instrument is envisaged within five years from its entry into force.

•Detailed explanation of the specific provisions of the proposal