EU Court Upholds Amazon's "Very Large Online Platform" Designation

The European Union's General Court has rejected a challenge from Amazon seeking to overturn its classification as a "very large online platform" (VLOP) under the bloc's Digital Services Act (DSA). This ruling means Amazon will remain subject to more stringent regulations designed to combat illegal and harmful content online, marking a significant legal setback for the US e-commerce giant.

Amazon had specifically contested the legality of the DSA provision that defines which online platforms qualify for the "very large" designation, a category reserved for companies exceeding a threshold of 45 million active users in the EU. Platforms identified as VLOPs face elevated responsibilities, including implementing robust measures to identify, remove, and prevent the spread of illicit content, as well as addressing broader systemic risks on their services.

During the court proceedings, Amazon argued that its marketplaces, such as the Amazon Store, fundamentally differ from social media platforms or content-sharing sites and therefore do not pose the kind of "systemic risks" that the DSA aims to address. The company contended that the nature of its retail operations does not inherently lead to the widespread dissemination of harmful material in the same manner as other online services.

However, the EU's second-highest court sided with the European Commission, affirming that the EU was justified in its assessment. The court stated that very large online platforms, including digital marketplaces that surpass the specified user threshold, do indeed present a risk to society. This perspective underscores the regulator's view that sheer scale can amplify potential harms, regardless of a platform's primary function.

The court explicitly outlined these risks as stemming from the "disseminating illegal content or infringing fundamental rights, including consumer protection." It further clarified that "the obligations imposed on those platforms... are intended to prevent those risks, even if they entail significant financial burdens for those platforms." This statement highlights the regulatory intent to prioritize user protection and societal well-being, even when compliance necessitates substantial investment from large tech companies.

Beyond its central argument regarding systemic risk, Amazon saw all its other presented arguments dismissed by the General Court. Following the decision, Amazon did not immediately provide a comment in response to inquiries.