Sunday, July 21, 2024

Amazon feels “unfairly singled out” by EU’s Digital Services Act

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Amazon doesn’t believe it fits the definition of a “very large online platform” — at least not how the European Union defines it.

The retail giant is taking legal action to challenge the EU’s new content moderation rules for big tech companies, claiming that the company is being unfairly targeted by the legislation. On Tuesday, Amazon filed a petition with the EU’s General Court to request that the European Commission annul its decision to designate Amazon as a “very large online platform” (VLOP) under the Digital Services Act (DSA), arguing that the company doesn’t meet the requirements to fall under such a category.

“The DSA was designed to address systemic risks posed by very large companies with advertising as their primary revenue and that distribute speech and information,” said Amazon spokesperson James Lewis in a statement to The Verge. “We agree with the EC’s objective and are committed to protecting customers from illegal products and content, but Amazon doesn’t fit this description of a ‘Very Large Online Platform’ (VLOP) under the DSA and therefore should not be designated as such.”

19 platforms identified to reach at least 45 million monthly active European users by the EU face some of the DSA’s strictest obligations

The DSA is a set of new regulations for digital services that are designed to police the goods and content that appear on the platforms. Under the legislation, VLOPs — digital platforms with at least 45 million monthly active users in the EU — will be subject to strict rules regarding transparency, content moderation, and risk management, including obligations for online marketplaces to track down individuals selling illegal goods or services. Platforms designated as VLOPS have until August 25th to comply with the DSA rules or risk fines of up to 6 percent of the company’s global annual turnover. For a company as large as Amazon, that figure wouldn’t be insignificant — the retailer reported netting $514 billion in global sales for 2022 alone.

The European Commission has also categorized 18 other companies as VLOPs or VLOSEs (Very Large Online Search Engines), including Google (independently listed as Play, Maps, Shopping, and Search), Bing, Apple’s App Store, Facebook, TikTok, Twitter, YouTube, AliExpress, Booking.com, and Wikipedia. 

In its statement, Amazon argues that the company is being “unfairly singled out,” as its retail business makes up most of its revenue, and alleges that it isn’t the largest retailer in any of the EU countries in which it operates. The company claims that its biggest competitors in each European country haven’t been categorized as a VLOP under the DSA and that the current rules would force the company to meet “onerous administrative obligations that don’t benefit EU consumers.”

German online retailer Zalando pursued similar legal action against the EU last month amid claims that its active European user base figures aren’t substantial enough to be considered a VLOP. Amazon is the first US company to challenge the General Court’s decision, and it’s expected that other Silicon Valley groups caught up in the legislation will be closely monitoring the situation.

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