Although many British companies are “cautiously optimistic” about complying with the EU’s proposal for a Digital Services Act (DSA), 92 per cent are concerned about the new regulations.

The proposal, which was submitted in December 2020, would provide businesses operating online in the EU area with a new set of rules to create a safer digital space and will involve a significant overhaul of businesses’ current responsibilities.

Research from Besedo found that for a quarter of those surveyed, a lack of understanding on how to comply with the regulation was a top concern.

A further 25 per cent of respondents said they had concerns regarding the cost of compliance.

The research also revealed that reputational damage from not complying is causing apprehension, with 22 per cent stating this as their biggest concern about the DSA.

“With the pandemic driving more consumers to use online platforms to shop, date and connect in a socially distanced world, the opportunity for fraudulent, harmful and upsetting content has increased,” said Petter Nylander, chief executive, Besedo. “There’s no hiding from the fact this regulation will significantly impact how businesses operate online. The DSA will force businesses to change the way they approach content moderation to protect users against dangerous and fraudulent activity.”

Besedo’s study demonstrates an awareness gap between large and small businesses. While 87 per cent of big businesses consider the DSA to be “a wide spanning act to create a safer digital space, affecting multiple platforms,” only 40 per cent of small businesses said the same.

This suggests that small businesses aren’t aware that if the DSA gains approval, it would impact them in a significant way.

“Our research suggests that businesses don't yet fully understand the potential impact the DSA will have, or the scale of the content moderation challenge that lies ahead of them to be compliant,” added Nylander. “Although it's too soon to build a moderation approach specifically designed for the DSA, businesses should not delay in setting up systems that keep their users safe.

He added: “In a similar way to how the GDPR guidelines were publicised in the media, it’s likely that the DSA will also be discussed before the new regulations are in place. This will put pressure on companies to prioritise safety before it becomes a legal requirement due to consumer awareness.”

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