Digital Services Act, why should you care?

4 May 2021

As the vaccines are rolled out slowly but surely and summer approaches, some people are getting hopeful for their next holiday and looking into accommodation options. Before the pandemic, the popularity of short-term holiday rentals, like Airbnb, was a pressing issue in cities. Chances are these rentals’ prevalence will rise back up with a return to normal.

Expansive uncontrolled growth of illegal practices in short-term holiday rental – such as renting out apartments for more nights than annually allowed, or advertising without a correct registration number when this is prescribed by law – is removing housing from the market and driving up prices. “We have introduced rules on short-term holiday rental in order to fight the shortage of rental housing and to ensure housing affordability” says Wenke Christoph, Permanent Secretary for Housing at Berlin’s Senate Department for Urban Development and Housing.

“Social and affordable housing as such is under pressure” adds Peter Florianschutz, Head of Vienna Assembly’s Committee on European and International Affairs, and Vienna Representative to the Committee of the Regions. “Public housing can’t be a traded good on global platform markets as public housing represents taxpayer’s money.”

Regulating digital

So, how can the European institutions help regulate this issue? Housing and illegal practices in short-term holiday rentals are a concrete example where the rules of the Digital Services Act (DSA), currently moving through its legislative process, can help cities intervene. The DSA was welcomed by cities in December 2020 as it included critical issues for cities regarding the effects of large online platforms in urban housing, retail or mobility systems, as well as progresses in protecting digital rights of citizens, and placing data gathered by online platforms at the service of research and knowledge.

“We were in fact very much looking forward to the DSA. We thought it could be the legal framework we needed to make sure that the platform economy does not harm livelihoods in cities,” says Laia Bonet, Deputy Mayor of Barcelona for the Digital Transition and International Relations, and Chair of the Eurocities’ Knowledge Society Forum.

Positive, yes, but cities also point out that there’s room for improvement. A group of 16 cities* and Eurocities compiled a letter directed at the European Institutions with amendments to the DSA, specifically related to  short-term holiday rentals. During a closed meeting with MEP Christel Schaldemose, Rapporteur on the Digital Services Act, Vienna, Berlin and Barcelona presented and argued for these to be integrated in the DSA report.

Enforcement issues

“We are now quite concerned about the enforceability of such mechanisms in a quick and effective manner by local authorities,” explains Bonet. Particularly, cities call for changes in the DSA that would clearly state that orders issued by administrative authorities immediately generate execution obligations and establish clear deadlines and timelines for platforms to take down illegal content.

“The DSA only requires platforms to inform the authorities of having received their request,” explains Christoph. “Platforms must be obliged to provide information when public authorities request them to do so. Without the cooperation of platforms, we are not able to prevent or to terminate infringements of public law by the users.”

Cities also stressed how, in a digital age, a regulation such as the DSA would be weaker if its rules cannot be effectively enforced cross-border. They therefore suggest amendments to give the Commission a more proactive role to ensure compliance of the rules in all member states and to intervene in case of inaction by the national Digital Services Coordinators. They also propose to create a referral mechanism when several Digital Services Coordinators from different member states identify a common pattern of non-compliance by a given platform.

MEP Christel Schaldemose was receptive to cities’ suggestions and agrees that the slogan that has accompanied the DSA “what is illegal offline should also be illegal online” should be backed by strong regulation.

The DSA is a horizontal regulation that will impact many sectors, housing being just one of them, so cities are keeping their eyes on it to make sure they get the best result for their citizens. It remains to be seen how their voices will translate at the European level.

* Amsterdam, Barcelona, Berlin, Bologna, Bordeaux, Brussels, Florence, Krakow, London, Munich, Paris, Porto, Prague, Valencia, Vienna, Warsaw and Eurocities


Wilma Dragonetti Eurocities Writer