DSA (Digital Services Act)

DSA (Digital Services Act) is a European Union regulation (Regulation (EU) 2022/2065) that came into full effect for all in-scope platforms in February 2024. It governs how online intermediaries — including OTAs, metasearch engines, and user-generated review platforms — handle content moderation, advertising transparency, algorithmic recommendation systems, and platform accountability.

The DSA establishes a tiered framework based on platform size. Online platforms with more than 45 million monthly active EU users are designated Very Large Online Platforms (VLOPs) and face the most stringent obligations. Both Booking.com and Expedia Group have been designated as VLOPs by the European Commission.

Key obligations for VLOPs

• Annual risk assessments covering systemic risks related to fundamental rights, democratic processes, and consumer protection
• Algorithmic transparency: users must be offered at least one recommendation option not based on profiling
• Ad transparency: detailed records of targeted advertising must be published in a public repository
• Independent audits of risk-assessment and compliance measures
• Data sharing with researchers and competent EU authorities on request

Why it matters

For hotels and OTAs, the DSA's transparency requirements affect several commercial practices:

• Ranking disclosure: OTAs must clearly explain the main parameters that determine search ranking, including whether paid placement influences results — impacting how hotels understand and invest in visibility programmes
• Review integrity: platforms must take reasonable measures to ensure reviews are genuine, raising the compliance bar around user-generated content
• Personalisation opt-outs: travellers can opt out of personalised search results, which may alter the traffic patterns hotels receive from algorithmic placements

Non-compliance carries fines of up to 6% of global annual turnover, creating strong incentives for OTAs to restructure certain ranking and advertising products.

Related

See DMA (Digital Markets Act) for the companion regulation governing competitive behaviour by "gatekeeper" platforms, and Rate Parity for the regulatory context around pricing restrictions.