Pearse Doherty (Donegal, Sinn Fein)
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137. To ask the Minister for Enterprise, Trade and Employment the extent to which the EU Digital Services Act requires online platforms and apps to compensate victims of financial fraud or authorised push payment scams through their platforms; its provisions in this regard; and if he will make a statement on the matter. [8141/23]

Dara Calleary (Mayo, Fianna Fail)
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EU Regulation 2022/2065 on a Single Market for Digital Services, the "Digital Services Act", provides that recipients of an intermediary service shall have the right to seek, in accordance with Union and national law, compensation from the provider of that service. This right is tied to the circumstances where the damage or loss suffered is due to an infringement of the obligations under the Digital Services Act.

These obligations include a requirement on online marketplaces to obtain information, such as identity, business and payment account details from traders operating on their platform. This is intended to ensure that users of the service know who they are dealing with and who to pursue for appropriate redress. The Digital Services Act also provides that designated "very large" online platforms and search engines, that is those that have over 45 million users in the European Union, must conduct an assessment of the risks that may arise from the design or functioning of their systems and provide for the mitigation of risks identified. These risks must include risks as to the dissemination of illegal content which includes illegal services. There are also obligations as to transparency as to how a service provider's recommender systems work and a prohibition on targeting advertisements using profiling based on certain categories of personal data.

The obligations which the Digital Services Act provides, therefore, relate to the systems that intermediary service providers are required to have in place to combat illegal content, including illegal services, appearing online rather than directly providing for remedies for the harm that may be caused by a specific instance of illegal content.

The Digital Services Act also restates and builds on the liability regime which applies to intermediary service providers. The basic rule is that these providers are not responsible for illegal material appearing on their sites unless they are specifically aware of its illegality. The Digital Services Act amends this in two important ways. Providers will not now be liable for material on their site purely because they have taken voluntary, own initiative, steps to identify illegal material. This removes the disincentive which was attached to making such checks. The Act also provides that providers who are online marketplaces will be liable in respect of illegal goods and services where that provider has presented itself, either by the way it presents information or the way in which it provides for transactions to be concluded, in a way which would cause a reasonable buyer to assume that the online marketplace is the party the buyer is contracting with.

All together, these obligations are designed to improve transparency of online services and give users more control over the services they received.

The Digital Services Act comes into effect for the majority of intermediary service providers on 17 February 2024. However, very large online platforms must comply with requirements that apply to them from four months after they have been designated, which could be from as early as Q3 of this year.