Amazon loses legal challenge to imposition of EU's strictest digital rules

US tech giant Amazon has failed to convince EU judges that it should not have to comply with the strictest requirements of the bloc’s Digital Services Act (DSA).

Amazon claimed that its e-commerce platform does not pose the systemic risks that the rules intend to combat. But in a ruling published on Wednesday, judges of the EU's General Court in Luxembourg dismissed the action.

The DSA, which entered into force in 2023, obliges platforms to prevent the spread of illegal content and products online.

Amazon is one of 25 entities designated by the European Commission as Very Large Online Platforms (VLOPs) because they have more than 45 million users per month. VLOPs are subject to the strictest measures under the DSA, meaning more frequent reporting obligations and supervisory fees paid to the Commission.

Amazon argued that the imposition of VLOP status infringes several fundamental rights, among them the freedom to conduct business and the protection of confidential information.

But in its Wednesday ruling, the court wrote that all very large online platforms, including marketplaces, are treated in “a uniform matter” since they may present systemic risks to society.

“Furthermore, the distinction made in the DSA between online platforms based on their number of users is neither arbitrary nor manifestly inappropriate for the objective of preventing such risks, since online platforms with more than 45 million users may expose a large number of persons to illegal content," the ruling said.

The ruling added that DSA obligations might bring about additional costs, but that “interference, which is provided for by law and does not affect the essence of the freedom to conduct a business, is justified for the purpose of the Charter of Fundamental Rights.”

Amazon said in a statement to Euronews that it will appeal to the EU's Court of Justice.

“We are disappointed with this ruling and intend to appeal," the statement said. "The Amazon Store, as an online marketplace, does not pose any such systemic risks; it only sells goods, and it doesn’t disseminate or amplify information, views or opinions."

The court last year already dismissed interim measures requested by Amazon in a bid to avoid full implementation until the challenge had been decided.

The company said that making its advertising methods public, as the DSA requires, would give away trade secrets to their competitors, but the court ruled that EU interests prevail over Amazon’s material interests. It also stressed the importance of the timely implementation of the law.

The decision follows a similar one in September, when the EU court ruled that German fashion retailer Zalando is bound by the strictest online platform rules – rejecting the company's claims that its user numbers are far lower than was estimated by the European Commission upon its designation.