Navigating the Digital Services Act: Implications for businesses

The Digital Services Act (DSA) introduces a new EU-wide framework for digital services. To understand its relevance for businesses, we spoke with Denise Borda, Senior e-Commerce Analyst at the Malta Communications Authority (MCA), which serves as Malta’s Digital Services Coordinator (DSC) under the DSA. The DSA requires every EU member state to designate a national authority responsible for monitoring compliance and enforcement. In Malta, this role is carried out by the MCA, which acts as the central contact point for regulatory guidance and support.

Denise explains that the DSA sets out harmonised rules for digital services, particularly those acting as intermediaries for consumers, goods, services, and content. This applies to intermediaries of all sizes, from micro-enterprises to large platforms. It includes social media platforms, online marketplaces, and other providers of intermediary services. Its objective is to improve user safety while ensuring a fair and transparent digital environment across the EU.

She notes that the DSA retains the liability exemption from the earlier eCommerce Directive. This means providers of intermediary services, including those operating platforms, are not automatically liable for illegal user-generated content, provided they act swiftly to remove it once they become aware of it. This helps providers understand their responsibilities and reduces exposure to legal uncertainty.

One of the main benefits of the DSA is the greater transparency and accountability it introduces, particularly for larger online platforms that have significant societal and economic impact. Online platforms must now outline any restrictions they apply in their terms of service, including rules on prohibited content or activities. This clarity, according to Denise, allows businesses to better align with platform rules and reduces the likelihood of unexpected removals or account suspensions.

Where content is moderated or removed, platforms are legally required to inform the affected business and explain the decision. They must provide a clear statement of reasons and offer a mechanism to challenge it. This ensures a fair and transparent process, which Denise says is particularly important for SMEs that rely heavily on digital platforms for visibility and sales.

The DSA also requires platforms to maintain effective complaint-handling systems. Businesses can submit complaints electronically and free of charge. If not satisfied, they may refer the case to an out-of-court dispute settlement body (ODSB) listed by the European Commission.

To promote transparency and combat illegal goods and services online, the DSA introduces Know Your Business Customer (KYBC) obligations for online marketplaces. These platforms must verify the identity of business users before allowing them to trade, adding a further layer of trust for both consumers and legitimate sellers.

Denise also explains the notice-and-action mechanism introduced by the DSA, which allows users, including businesses and consumers, to report illegal content. Online platforms are obliged to act on such notifications in line with established procedures. This contributes to a safer online environment and reinforces trust in digital services.

In conclusion, Denise views the DSA as a positive development for the business community. It strengthens legal certainty, promotes transparency, and helps businesses engage more confidently with digital platforms across the EU. Thanks to the DSA, businesses can operate with clearer expectations and benefit from a more accountable online ecosystem.