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Four new European regulations impacting the European digital market in 2021

+++ BONUS: THE DIGITAL SERVICES ACT PACKAGE

The regulation of the European digital market is a constant preoccupation of the European Commission. Be it for the increase of the consumer welfare, as the Commission claims, or for setting roadblocks on the path of the technology powerhouses to dominate the European digital space, as the industry claims, here are the most important European regulations that will shape the European digital market in 2021.

1. Audiovisual Services – Keeping Up with New Video Content Distribution Models

The 2018 Audio Visual Services Directive[1] is already here and brings significant changes for linear broadcasters and on-demand service providers, providing minimum harmonization standards. One of the most notable change brought about is the introduction of rules regarding video sharing platforms, which will be subject to stricter obligations to protect viewers, especially minors, from harmful content in the online world and will be required to take appropriate measures to protect individuals from incitement to violence or hatred and content constituting criminal offences (in essence, a public provocation to commit terrorist offences, child pornography and racism/xenophobia).

Despite the implementation deadline of 19 September 2020, Romania is still to present for public consultation a draft implementation law.

2. European Electronic Communication Code – Consolidation and Reform

In December 2018, the first the European Electronic Communications Code (“EECC”) was adopted[2], representing a far-reaching reform of the European framework in the field of electronic communications. The notion of electronic communications service was expanded to incorporate the evolutionary changes in the sector, leading to more and more service providers being subject to the provisions of EECC (e.g. interpersonal communications services provided over the internet, such as Whatsapp, are now included in the electronic communication services).

EECC must be transposed by the Member States until 21 December 2020. In Romania, the draft implementation law is currently under debate and, with the deadline just around the corner and a Parliament in the making, it is unlikely that the implementing law will be adopted in time.

3. Expanding Consumer Rights in the Digital Space

2019 Digital Content Directive[3] and 2019 Sale of Goods Directive[4] aim to reduce transaction costs for businesses by aligning the EU legislation and to increase the level of protection and legal certainty for consumers when buying from across the EU. These come in addition to 2019 Platform-to-Business Regulation[5] which deals with the relationship between platforms and their business users, which came into effect in July 2020.

While the Sale of Goods Directive applies to sale contracts between a consumer and a seller for goods, including goods with a digital element (e.g. smartwatches, smart TVs etc.), while the Digital Content Directive applies to contracts concluded between a consumer and a trader which supplies digital content or digital services. The definition of “digital services and digital content” covers, inter alia, social media services, software as a service and various computer applications. However, certain services, such as healthcare, financial services and open-source software, are expressly excluded. A very important aspect is that the Digital Content Directive also applies when the consumer provides its personal data as payment in return for the digital content or service. The question of contract validity, in this case, is, however, left to the national laws.

Both directives must be adopted by the Member States before July 1, 2021, and shall apply from 1 January 2022.

4. Biggest Overhaul in Copyright Laws for 20 Years

The 2019 Copyright Directive[6] is the biggest overhaul of European copyright laws since 2001 in view of increased cross-border use of digital content. The new rules provide increased protection for authors and artists while opening new possibilities for accessing and sharing copyrighted content online across the European Union.

Online content sharing service providers are greatly impacted by this Copyright Directive. In an unprecedented shift in liability for copyright infringements, content sharing platforms will be, in principle, required to obtain licenses for copyright-protected content uploaded by users, unless certain conditions set out in the Copyright Directive are met. The new rules continue to be subject to intensive debate and the practical implementation of “policing” and rights collection systems is giving the whole industry a big of headache.

The Copyright Directive must be implemented across EU by 7 June 2021.

Bonus: The Digital Services Act Package 

The Digital Services Act (“DSA”) is a legislative package published on 15 December 2020 by the European Commission, which aims to create a modern legal framework for digital services[7]. DSA represents the biggest regulatory reform effort in the sector of digital services since the 2000 E-commerce Directive in 2000 and is aimed at strengthening the Digital Single Market and ensuring that digital service providers in the European Union act responsibly to mitigate risks faced by their users and to protect their rights. It aims to tackle the issues posed by the rising power of internet platforms, especially of the so-called gatekeepers (who, for example, would be required to observe requirements intended to ensure inter-operability with competitors) and marks a return by the European Commission to ex-ante type of measures rarely seen in a couple of decades.

 

[1] The Directive (EU) 2018/1808 amending Directive 2010/13/EU on the coordination of certain provisions laid down by law, regulation or administrative action in the Member States concerning the provision of audiovisual media services (Audiovisual Media Services Directive) in view of changing market realities (“AVMSD”)

[2] Directive (EU) 2018/1972 of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code, repealing the provisions of Directive 2002/21/EC

[3] The Directive (EU) 2019/770 on certain aspects concerning contracts for the supply of digital content and digital services;

[4] Directive (EU) 2019/771 on certain aspects concerning contracts for the sale of goods;

[5] Regulation (EU) 2019/1150 of the European Parliament and of the Council of 20 June 2019 on promoting fairness and transparency for business users of online intermediation services;

[6] DIRECTIVE (EU) 2019/790 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC

[7] https://ec.europa.eu/digital-single-market/en/digital-services-act-package

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