A comparative analysis evaluating the various transparency reporting mechanisms employed by online platforms, using the European Union’s Digital Services Act (DSA) as a basis for developing an analytical framework for evaluation

Partner: European Commission

This study on transparency reporting of online intermediary services provides a comparative analysis of different forms of transparency reporting on online platforms. Using the EU Digital Services Act (DSA) as a starting point, we look at different transparency reporting requirements and practices by online platforms. In order to do this effectively, we first develop a theoretical framework for the quality of transparency reporting based on academic literature. We then apply these quality categories to the transparent reporting requirements of online platforms to assess which requirements and practices are likely to produce high-quality outputs.

Transparency reporting is a leading concept for the governance of online platforms (MacCarthy 2020a). The DSA includes provisions to harmonise such reporting obligations within the European Union. Of special importance to the transparency reporting obligations of the law are the mandatory reporting duties as defined in Art 15, Art 24, and Art 42 DSA, which describe the extent of the reporting according to the platform in correlation of their service provided and users acquired. Their reporting depth, therefore, varies and is becoming more rigorous for online platforms and most excessive for large online platforms and search engines (Dinar and Hinrichs 2022). For example, Art 42 DSA would define reporting obligations that only are addressed to Very Large Platforms (VLOPs) and Very Large Search Engines (VLOSEs). Both VLOPs and VLOSEs are defined in Art 33 para 1 DSA, and the number of average monthly users is taken into account to measure the threshold of VLOPs and VLOSEs. Additionally, platforms can implement voluntary transparency reporting, e.g., according to Art 44 DSA (including Standards) or follow certain Codes of Conduct as described under Art 45, 46, and 47 DSA.

This study includes obligatory and voluntary reporting (see transparency-norm classes 1-4) and maps it against key concepts of the transparency reporting processes across the legal landscape. By providing a novel analytical framework for evaluating the quality of transparency reporting, this study aims to provide guidance for stakeholders, like regulators and the public, to assess the reporting quality of platforms. Furthermore, by comparing and mapping transparency reporting, this analysis will be performed on a set of selected norms and codes and provide categories to assess key concepts to map against within the process of transparency reporting. This comparison includes the creation of best practices and recommendations for qualitative transparency reporting and proposes a visualisation for providing such information in a tabular form (see Annex). Additionally, the benefits and drawbacks of reporting are defining a selection of the best practices included in this report.

Date: September, 2023.

The full report is available below.