European Union: You've Been Designated! The EC Designates The First Batch Of VLOPs And VLOSEs Under The Digital Services Act

The European Commission ("Commission") has adopted the first designating decision under the Digital Services Act ("DSA").

It designated 17 Very Large Online Platforms ("VLOPs") and 2 Very Large Online Search Engines ("VLOSEs") based on the user data that they had to publish on 17 February 2023. The DSA classifies online platforms or online search engines (as defined in the DSA) that have more than 45 million users per month in the EU as VLOPs or VLOSEs.

This designation by the Commission is not exhaustive, it has indicated that there could be a second batch of VLOPs/VLOSEs designated in the next few weeks and it is also conducting checks on some other platforms (Spotify, Telegram, Pornhub and AirBnB) who told it they do not meet the criteria of 45 million monthly active users ("MAU").

Will Ireland be a leading enforcement jurisdiction for the DSA as it is for the GDPR?

Of those designated, the majority of VLOPs and VLOSEs have their European base in Ireland. The DSA relies on a strengthened country of origin principle. Only the member state where a platform is established will be competent in the first instance, in Ireland this is Coimisiún na Meán. The European Commission provides additional oversight with exclusive powers of supervision and enforcement over VLOPs and VLOSEs and will work in close cooperation with the Coimisiún na Meán under the supervisory framework. This means that Ireland will have a significant role to play working alongside the European Commission in supervising the VLOPs and VLOSEs who have establishment here.

Publication of Average Monthly Users

The DSA requires providers of online platforms and online search engines (as defined in the DSA) to publish for each online platform or online search engine they operate, information on the average monthly active recipients ("AMAR") of their service in the European Union, calculated as an average over 6 months in a publicly available section of their online interface. To date the Commission has only published a Q&A document which aims to assist providers in complying with this obligation. In the future, the Commission has indicated that it will adopt binding measures setting out the methodology of counting active recipients of services in the Union but to date there has been no further guidance.

Who is an active recipient?

The DSA defines the following:

• 'active recipient of an online platform' means a recipient of the service that has engaged with an online platform by either requesting the online platform to host information or by being exposed to information hosted by the online platform and disseminated through its online interface.
• 'active recipient of an online search engine' means a recipient of the service that has submitted a query to an online search engine and been exposed to information indexed and presented on its online interface.

The DSA explains that information that a provider of an online platform publishes on its online interface should reflect all recipients that have actually engaged with the service at least once in the previous six month period. Engagement with the service can include exposure to content disseminated on the online interface of an online platform or the provision of content for display on the platform. This means that the recipients on each side of the online platform, including consumers, business users and traders, are all potentially relevant for the purposes of counting "active recipients." Importantly, providers are to avoid double counting where possible and to only count a recipient of their service once that uses different online interfaces such as websites or apps. Providers that have the technical means to identify inauthentic users such as bots or scrapers may discount such users when calculating the AMAR.

Next steps for those designated...

Following designation, VLOPs and VLOSEs have four months to comply in full with the DSA under which they have the most obligations imposed on them of all the providers. This is an enormous undertaking for even the most sophisticated providers. If you need assistance in ensuring you comply with all your obligations in the DSA please feel free to reach out for our DSA Checklist relevant to your business.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.