EU eyes counterfeit goods clampdown in Digital Services Act

The EU’s plans to update regulations on e-commerce will include new measures to curb the sale of counterfeit and otherwise illegal products, according to vice-president for digital affairs Margrethe Vestager.

In a speech delivered at the Forum Europe Conference late last week, Vestager said that e-commerce platforms like eBay, Amazon, and Alibaba “need to act much more rigorously against illegal products and services offered on their platforms.”

She added that they also “have to cooperate more closely with law enforcement authorities, so that the authors behind such criminal activity can be caught.”

The EU is working on a new Digital Services Act (DSA) to replace the E-Commerce Directive, which was adopted 20 years ago and is no longer fit for purpose as so much of our daily lives has transitioned online.

That switch has become more pronounced since the coronavirus crisis hit, said Vestager, with much more reliance on online shops but also a “surge in manipulative and illegal activities to exploit consumers.”

Giving just one example, she pointed to a recent UK study which examined 200 toys bought from “the largest online marketplaces” and found more than half (58 per cent) could not be legally sold in the EU because they didn’t meet safety standards.

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“This is unacceptable. Consumers shopping on high street stores would not think twice whether the toys they see on the shelves are dangerous, or whether that expensive leather bag might be fake [and] we need to have the same trust when shopping online, said Vestager.

Among the changes in the pipeline are that e-commerce platforms will have to do better at identifying, verifying and monitoring sellers, act more “vigorously” against illegal products and services offered, and cooperate more closely with law enforcement so transgressors can be caught.

Decisions to take down content or product listings will also have to be transparent so that legitimate products and services are not removed accidentally, and open to challenge.

Aside from unsafe and illegal goods and content, the DSA will also be designed to tackle issues like competition – to ensure the big players cannot leverage their size to squeeze out smaller rivals.

It will also provide a framework for regulating other digital problem areas like disinformation, for example information that encourages people to ignore official health advice and engage in risky behaviours.

A consultation period on the proposals is due to start in September and a final version of the DSA is due before the end of the year, said Vestager.