The Digital Services Act (DSA), part of the EU’s Digital Services reform package, entered into force on 16 November 2022.
The DSA is designed to provide greater online safety, imposing obligations on the providers of various online intermediary services, such as social media and e-commerce websites. The DSA will not take full effect until 17 February 2024. However, several of its provisions have taken immediate effect, including the requirement for designated online platforms and online search engines to publish their number of active users by 17 February 2023.
While most of the DSA will apply directly in EU Member States, national legislation is required to give effect to some of its provisions. The Department of Enterprise, Trade and Employment has recently published the general scheme of a Digital Services Bill 2023 (the General Scheme). The General Scheme addresses the designation of a Digital Services Coordinator for Ireland (as referred to below) and other miscellaneous matters such as the liability of providers of online intermediary services, and the harmonisation of court orders to take down illegal content.
Designation of Digital Services Coordinator
The DSA requires Member States to designate a competent authority, the Digital Services Coordinator, responsible for applying and enforcing the DSA in the Member State. The General Scheme designates Coimisiún na Meán (CNM), a recently established body, as the Digital Services Coordinator for Ireland. CNM’s responsibilities will include:
- investigating suspected contraventions of the DSA,
- publishing guidance on orders to provide information,
- acting on illegal content,
- certifying out-of-court dispute settlement bodies, and
- receiving complaints from users of online intermediary services.
CNM, in its capacity as Digital Services Coordinator, will have the power to block access in Ireland to relevant online intermediary services and, subject to the confirmation of the courts, to impose the following fines on intermediary service providers:
- up to 6% of global turnover for breach of an obligation under the DSA; and
- up to 1% of global turnover or annual income for failure to comply with requests for information, whether under the DSA or in the course of an investigation, or for failure to comply with other obligations to cooperate with an investigation, such as submitting to an inspection.
The General Scheme also empowers CNM to impose periodic penalties on online intermediary service providers. The maximum penalty per day shall not exceed the greater of 5% of the average daily worldwide turnover or income of the intermediary service provider in the preceding financial year or €1,000.
The General Scheme also provides for the reporting of information on breaches of the DSA to CNM by An Garda Síochána and other prescribed authorities. The General Scheme notes that the Government is currently assessing other relevant regulators to be responsible for the supervision of the providers of online intermediary services and enforcement of the DSA. CNM will not be able to exercise its powers or functions until the DSA takes full effect on 17 February 2024.
While the DSA will provide greater safety for online users, it will have wide-ranging implications for online intermediary service providers subject to this new regime, particularly considering the potential fines and penalties that the CNM will have the power to enforce for failure to comply.
If you would like further information or have any queries on how the DSA could impact your business, please get in touch with our Technology Department or your usual William Fry contact.
Contributed by Claire O’Connor