Compensation Mechanisms and Remedies under DSA
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Overview
Legal Framework
Compensation mechanisms and remedies under the Digital Services Act (DSA) are primarily governed by Recital 121 DSA. It establishes that, without prejudice to the liability exemptions for intermediary services, a provider is liable for damages suffered by recipients caused by that provider's infringement of its DSA obligations. Compensation must be provided in accordance with applicable national law. Recital 64 DSA further outlines a specific remedy, stating that providers of online platforms should, under certain conditions, temporarily suspend their activities concerning a person engaged in abusive behaviour, while respecting the platform's freedom to impose stricter measures for manifestly illegal content.
Practical Application
The T&C commentary, while focused on GDPR cooperation, underscores a foundational legal principle relevant to the DSA's compensation framework: the obligation for authorities to exert their utmost effort to reach consensus. This principle of diligent procedural cooperation informs the broader ecosystem in which DSA remedies and compensation claims will be adjudicated and enforced. Crucially, Recital 121 DSA does not create a standalone EU compensation right but acts as a "pass-through," triggering liability under national tort or contract law for breaches of DSA duties. The case of Nikolaou v Commission illustrates the standard burden of proof in non-contractual liability cases, which will analogously apply to DSA-based claims: the claimant must demonstrate an illegal act (here, a DSA infringement), quantifiable damage, and a causal link between them.
Key Considerations
- National Law is Paramount: A provider's liability for damages under the DSA is not directly determined by EU law. Organizations must identify and comply with the specific substantive and procedural rules for compensation claims in each Member State where they operate.
- Document DSA Compliance Diligently: To defend against compensation claims, providers must maintain robust, auditable records demonstrating adherence to all relevant DSA obligations (e.g., notice-and-action procedures, transparency reporting). This evidence is critical for disproving allegations of an infringing "illegal act."
- Prepare for Platform-Specific Remedies: Beyond financial compensation, platforms must establish clear, transparent internal procedures for implementing Recital 64's suspension remedy for abusive users, ensuring such measures are proportionate, reasoned, and subject to internal complaint handling.