Issue link: https://maltatoday.uberflip.com/i/1439469
maltatoday | SUNDAY • 26 DECEMBER 2021 12 COMMERCIAL The developing EU Digital Regulatory TWO regulatory proposals published by the European Commission on the 15 Decem- ber 2020 are set to update the regulatory framework as a re- sult of the ongoing digitaliza- tion of services. In the words of the Executive Vice-President Margrethe Vestager, these two proposals "serve one purpose: to make sure that we, as users, as customers, as businesses, have access to a wide choice of safe products and services online, just as well as we do in the physical world. And that all businesses operating in Eu- rope, that can be big ones, that can be small ones, that they can freely and fairly compete online, just as they do offline. Because this is one world". Proposal for a Regulation of the European Parliament and of the Council on a Single Market for Digital Services – Digital Services Act The Proposal for a Digital Services Act builds upon the success of the e-Commerce Directive 2000/31 by taking in- to account the court interpre- tations that have shaped elec- tronic commerce across the years and adapting the current rules to new technologies in- troduced into the market over the years. The Proposal is aimed at pro- viders of digital services which comprise: • Intermediary services offering network infra- structure such as Inter- net access providers, do- main name registrars • Hosting services such as cloud and webhosting services • Online platforms bring- ing together sellers and consumers such as online marketplaces, app stores, collaborative economy platforms and social me- dia platforms. • Very large online plat- forms reaching more than 10% of 450 million consumers in Europe. In its provisions applicable to online platforms, the Proposal calls for greater transparency obligations on the providers to ensure a safer online environ- ment to the consumers. Additional obligations are put on very large online plat- forms to manage systemic risks by conducting risk as- sessments and submitting themselves to external and in- dependent audits. Adherence to the obligations set out in the Proposal depends on the role, size and impact of the service provider. The four basic obli- gations that are common to all providers are (1) transparency reporting, (2) clear terms of service that must also give due account to fundamental rights, (3) cooperation with national authorities and (4) points of contact and, where necessary, legal representative. Providers of hosting services (including the online platforms) must put mechanisms in place to allow notification by users of the presence of information con- sidered to be illegal content and must provide to the user (and also make publicly avail- able), a statement of reasons explaining why a host has re- moved or disabled content. Proposal for a Regulation of the European Parliament and of the Council on contestable and fair markets in the digital sector - Digital Markets Act Building on the Proposal for a Digital Services Act, the Proposal for Digital Markets Act creates another layer of obligations focusing on large online platforms that have a strong position in the market by providing services across a number of states and to a large user base. In view of the onerous obli- gations that are required from these platforms, the Propos- al sets objective criteria that define which platforms will be captured by the proposed rules. These core platform service providers are defined by the Regulation as "gatekeepers". Preamble (4) of the proposed Regulation notes how the manner how gatekeepers have evolved has created "serious imbalances in bargaining pow- er and, consequently, to unfair practices and conditions for business users as well as end users of core platform services provided by gatekeepers, to the detriment of prices, quality, choice and innovation there- in". As a result, the Commission is proposing a number of obliga- tions to strike a fairer balance of power including enabling end users to freely choose to opt-in to business practices of- fering a less personalised alter- native or to freely acquire con- tent, subscriptions, features or other items outside the core platform services of the gate- keeper. Needless to say, the Commission is also strength- ening the position of end users by, amongst others, safeguard- ing their right to raise con- cerns about unfair behaviour by gatekeepers with adminis- trative or other public author- ities.Both proposals have been submitted for the review of the European Parliament and the Council, and both institutions can make changes to the texts, until the final texts are finally approved through the Europe- an legislative procedure. Also in the pipeline…. The European institutions Pauline Debono Legal Advisor Finance and Contracts Department