11 February 2020
DIGITAL SERVICES ACT: the Single Market Pillar
In her Presidential candidacy speech
(page 13) Ursula von der Leyen announced the
Commission should propose a new Digital Services Act (DSA). The DSA initiative stil lacks
clarity on its form and contents, however provisional exchanges on DSA include the idea of
revision of the e-Commerce Directive
as the basis. Yet following a public consultation on the
regulatory environment for platforms, online intermediaries, data and cloud computing and the
collaborative economy, in 2016 the Commission acknowledged it was fit for purpose and did not
revise the directive. There is wide acknowledgement that the currently applicable e-Commerce
Directive has been key in flourishment of e-commerce in the EU over the last 20 years. However,
fast evolution of the online economy has changed its landscape and broadened the impacts on
business and society at large.
This is why over the last legislature some specific online intermediary issues were tackled
through targeted legislative action in other areas, such as AVMS directive, Copyright Directive,
Platform-to-Business Regulation, Market Surveil ance Regulation, Geo-blocking Regulation,
New Deal for Consumers, the proposal for a Regulation on Preventing the Dissemination of
Terrorist Content Online, as well as the Recommendation on Measures to Effectively Tackle
Il egal Content Online. This massive body of recent law should be taken into consideration
before taking next initiatives.
The new Commission President underlined that the DSA “wil upgrade our liability and safety
rules for digital platforms, services and products, and complete our Digital Single Market.”
2. Principles for a possible update of e-Commerce Directive
Based on the Commission President’s statement, the DSA might encompass two pil ars:
1. Purely commercial
(trading information society services without barriers) – Single
2. Broader societal interests
(redefining liability aspects, tackling hate speech,
misleading information, terrorist content etc.) – content pillar
This paper focuses on the Single Market pillar
as the first step and suggests our approach
to a possible revision of the e-Commerce Directive. BusinessEurope wil supplement this paper
to include the other pil ar or any additional issues in the coming months.
The DSA initiative should address the Single Market and the content pil ars separately. 2.
The same legal instrument cannot address such a broad range of issues mentioned above
as “one-size fits all” in an effective manner. Differences between B2B and B2C platforms
should be recognized and their specificities need a very targeted approach so that the
framework supports innovation. The legal base question would also arise and freedom to
provide cross-border information society services might become hostage to the issues
bordering criminal law of Member States, should the same legal instrument address wider
issues under the content pil ar.
Country-of-origin principle of the e-Commerce Directive should not be opened for any re-
think as this is one of the cornerstones of the Single Market. Key Single Market provisions
of the directive should be preserved (see chapter 3 of this position paper).
Single Market legislation (including the e-Commerce Directive) should consistently reflect
the market integration ambition. Any possible initiatives should fully respect the four Single
Market and data movement freedoms. In order to foster the free flow of data, entry barriers
for services should be removed. Users should be empowered when accessing digital
services through encouragement to adopt the codes of conduct for switching providers and
porting data between different services. Should the e-Commerce Directive be reviewed,
assessment of remaining barriers and improving the Single Market have to remain its key
objectives without the addition of new ones.
BusinessEurope supports further opening and integration of the services markets. Where
full harmonisation is not necessary, the mutual recognition principle should be respected
and solutions for its practical enforcement found, including in the area of services.
The new framework should apply to 3rd-country-established information society service
providers operating in the EU and mandate them to have a “digital representative” to aid
market surveil ance authorities in the EU in their enforcement of Single Market rules.
3. Key Single Market provisions in e-Commerce Directive
BusinessEurope considers the following e-Commerce Directive provisions as key to the barrier-
free trade in information society services in the Single Market:
• Article 1 (1)
establishing the objective of the Directive: it is crucial that it remains
focused on proper functioning of the internal market by ensuring the free
movement of information society services.
• Article 1 (3)
establishing the relationship of the e-Commerce Directive with other
Community law applicable to information society services: it is key to draw a clear
line between different legal instruments regulating information society services in
order to have a clear, targeted and Single Market-friendly framework. Distinction
between the “Single Market pillar” and “content pillar” needs to be preserved.
• Article 3 (2)
establishing one of the cornerstones of the Directive – country-of-
origin principle: the latter provision should not be opened for any re-think as this
is one of the cornerstones of the Single Market. Its application and enforcement
should be strengthened.
• Article 3 (6)
on compatibility checks of the notified measures with Community
law: it is also crucial that sufficient powers of the Commission to assess the
notified rules of Member States are ensured.
• Article 4
prohibiting prior authorisations or any other requirements having
equivalent effect: one of the most important principles guaranteeing deeper
integration of the market should be preserved.
• Article 9
on validity of contracts concluded by electronic means: it is essential to
preserve the provisions that guarantee electronic contract validity across the EU
and are the safeguard against obstacles for the use of electronic contracts and
their legal effectiveness.
• Information requirements spelled out under Articles 5, 6 and 10
limited to what is necessary and proportionate in attainment of the Directive’s