# C_2023314EN.01000902.xml

| 4.9.2023 | EN | Official Journal of the European Union | C 314/9 |
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4.9.2023

EN

Official Journal of the European Union

C 314/9

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Action brought on 27 June 2023 — Zalando v Commission

(Case T-348/23)

(2023/C 314/13)

Language of the case: German

Parties

Applicant: Zalando SE (Berlin, Germany) (represented by: R. Briske, K. Ewald, L. Schneider und J. Trouet, lawyers)

Defendant: European Commission

Form of order sought

The applicant claims that the Court should:

| — | annul the decision of the European Commission of 25 April 2023, C(2023) 2727 final; |
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annul the decision of the European Commission of 25 April 2023, C(2023) 2727 final;

| — | order the defendant to pay the costs. |
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order the defendant to pay the costs.

Pleas in law and main arguments

In support of the action, the applicant relies on the following pleas in law.

| 1. | First plea in law, alleging misapplication of the scope of Regulation (EU) 2022/2065 (1) (Digital Services Act; ‘the DSA’) and an error in law in the application of the DSA
  The applicant is of the opinion that the DSA is not applicable to it, as it is already not an intermediary service and consequently neither a hosting service nor an online platform within the meaning of the DSA. It lacks the necessary provision of third-party content. The applicant provides its own content through the sale of its articles and has also fully adopted the content of its partners through a strict onboarding process.
  Even if part of the service qualified as an online platform, it did not reach the threshold of 45 million monthly active users. The defendant disregards the hybrid nature of the service: not all users of the service are automatically exposed to content provided by third parties, but a precise differentiation is required.
  The defendant relied on erroneous criteria, such as the alleged non-identifiability of the provider. It fails to recognise that this is not a decisive characteristic, but rather, taking into account EU law evaluations, supports the assumption of the existence of own content. |
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1.

First plea in law, alleging misapplication of the scope of Regulation (EU) 2022/2065 (1) (Digital Services Act; ‘the DSA’) and an error in law in the application of the DSA

The applicant is of the opinion that the DSA is not applicable to it, as it is already not an intermediary service and consequently neither a hosting service nor an online platform within the meaning of the DSA. It lacks the necessary provision of third-party content. The applicant provides its own content through the sale of its articles and has also fully adopted the content of its partners through a strict onboarding process.

Even if part of the service qualified as an online platform, it did not reach the threshold of 45 million monthly active users. The defendant disregards the hybrid nature of the service: not all users of the service are automatically exposed to content provided by third parties, but a precise differentiation is required.

The defendant relied on erroneous criteria, such as the alleged non-identifiability of the provider. It fails to recognise that this is not a decisive characteristic, but rather, taking into account EU law evaluations, supports the assumption of the existence of own content.

| 2. | Second plea in law, alleging that Article 33(1) and (4) in conjunction with Article 24(2) of the DSA are vague
  The specifications for calculating the threshold value are too imprecise and infringe the principle of certainty under EU law. Article 33(1) of the DSA is therefore not a legal basis in conformity with Union law. Recital 77 of the DSA is insufficient for the determinability of the calculation method due to its legal nature and its incomplete content, as too many essential questions are left open. It describes only who should be covered, but not how. In the end, the criteria could not be sufficiently determined without the adoption of a delegated act. The inadequacy is made clear by a comparison with Regulation (EU) 2022/1925 (2) (Digital Markets Act): the latter is partially based on the same threshold, but goes further and even specifies the calculation criteria in a separate annex. However, it also lacks sufficiently concrete calculatory specifications. |
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2.

Second plea in law, alleging that Article 33(1) and (4) in conjunction with Article 24(2) of the DSA are vague

The specifications for calculating the threshold value are too imprecise and infringe the principle of certainty under EU law. Article 33(1) of the DSA is therefore not a legal basis in conformity with Union law. Recital 77 of the DSA is insufficient for the determinability of the calculation method due to its legal nature and its incomplete content, as too many essential questions are left open. It describes only who should be covered, but not how. In the end, the criteria could not be sufficiently determined without the adoption of a delegated act. The inadequacy is made clear by a comparison with Regulation (EU) 2022/1925 (2) (Digital Markets Act): the latter is partially based on the same threshold, but goes further and even specifies the calculation criteria in a separate annex. However, it also lacks sufficiently concrete calculatory specifications.

| 3. | Third plea in law, alleging infringement of the general principle of equality
  The indeterminacy of the calculation method infringes the first sentence of Article 2 TEU and Article 20 of the Charter of Fundamental Rights of the European Union, as this leads to a (de facto) unequal treatment of providers of online platforms. The providers fill the gap, which is created in particular by the fact that tracking of individual users is prohibited, with inconsistent and non-transparent methods. At the same time, the DSA does not provide for a mandatory control of all calculation methods, but only ad-hoc checks. This does not create a fair level playing field for competing service providers. Moreover, the DSA infringes the principle of equal treatment by applying a blanket threshold to all online platforms, regardless of the risk-based criteria of the respective services. |
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3.

Third plea in law, alleging infringement of the general principle of equality

The indeterminacy of the calculation method infringes the first sentence of Article 2 TEU and Article 20 of the Charter of Fundamental Rights of the European Union, as this leads to a (de facto) unequal treatment of providers of online platforms. The providers fill the gap, which is created in particular by the fact that tracking of individual users is prohibited, with inconsistent and non-transparent methods. At the same time, the DSA does not provide for a mandatory control of all calculation methods, but only ad-hoc checks. This does not create a fair level playing field for competing service providers. Moreover, the DSA infringes the principle of equal treatment by applying a blanket threshold to all online platforms, regardless of the risk-based criteria of the respective services.

| 4. | Fourth plea in law, alleging infringement of the principle of proportionality
  The application of the DSA disproportionately interferes with the applicant’s fundamental freedoms and rights and thus infringes the principle of proportionality set out in the second subparagraph of Article 5(4) TEU. On the one hand, the blanket threshold is inappropriate, and, on the other hand, the imposition of further obligations on the applicant is no longer necessary, as online trade is already (over-) regulated. |
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4.

Fourth plea in law, alleging infringement of the principle of proportionality

The application of the DSA disproportionately interferes with the applicant’s fundamental freedoms and rights and thus infringes the principle of proportionality set out in the second subparagraph of Article 5(4) TEU. On the one hand, the blanket threshold is inappropriate, and, on the other hand, the imposition of further obligations on the applicant is no longer necessary, as online trade is already (over-) regulated.

| 5. | Fifth plea in law, alleging infringement of the obligation to state reasons
  In its decision, the defendant infringed the obligation to state reasons under Article 296 TFEU, so that it was not comprehensible to the applicant as an addressee. There is no subsumption under the definition of hosting service according to Article 3(g)(iii) of the DSA, although this is decisive for the applicability of Article 33 of the DSA. |
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5.

Fifth plea in law, alleging infringement of the obligation to state reasons

In its decision, the defendant infringed the obligation to state reasons under Article 296 TFEU, so that it was not comprehensible to the applicant as an addressee. There is no subsumption under the definition of hosting service according to Article 3(g)(iii) of the DSA, although this is decisive for the applicability of Article 33 of the DSA.

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(1)  Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act) (OJ 2022 L 277, p. 1).

(2)  Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act) (OJ 2022 L 265, p. 1).

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