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Online Marketplaces – Too Many Chefs in the EU Kitchen?

group of people in white robe standing in front of brown wooden desk

In December 2020, the European Commission published its Digital Services Act (DSA). In its introduction the DSA is explicitly described as a horizontal, harmonised framework for all intermediary services. The idea is that existing and future sector-specific legislation can build on top of it. Sectoral legislation tends to be more detailed and hence requires updates frequently whereas the DSA should be principles-based and remain future-proof for several decades like its predecessor from 2000, the e-Commerce Directive.

However, as could be expected, all lawmakers are eager to leave their mark on the DSA proposal. Some have even gone as far as adding entire sector-specific legislation to the proposal. The lead European Parliament Rapporteur for instance has proposed to add detailed, sector-specific rules on online marketplaces to the DSA. Similarly,  the former Council Presidency proposed to include a new set of “provisions applicable to providers of online marketplaces.”

These developments suggest that the original ambition, a horizontal and future-proof DSA, is mutating into something else. Product safety, offline as well as online, is obviously important. The question is how to best regulate this.  

On June 30, the European Commission published its General Product Safety Regulation (GPSR) proposal. This long-awaited initiative will update the existing Directive to respond to new challenges related to digital technologies and online sales (cybersecurity risks, application of product safety rules to software, etc.). Interestingly, this new proposal has a specific chapter dedicated to online marketplaces. The GPSR seeks to protect consumers against dangerous products when shopping online as well as  offline. It also proposes more obligations on online marketplaces (establishing a single contact point, registering with the Safety Gate portal, etc.).

As correctly pointed out by the European Commission, it will be key to harmonise the GPSR with the DSA. The two instruments can complement each other but they shouldn’t overlap or contradict each other. The sector-specific marketplace provisions obviously belong in a sector-specific legislation, the GPSR, and not in the horizontal DSA.

EU lawmakers’ attention to online marketplaces is commendable. But just as too many chefs in the kitchen spoils the broth, so can too many lawmakers.

European Union

DisCo is dedicated to examining technology and policy at a global scale.  Developments in the European Union play a considerable role in shaping both European and global technology markets.  EU regulations related to copyright, competition, privacy, innovation, and trade all affect the international development of technology and tech markets.