Court upholds Zalando very large online platform status under EU Digital Services Act

The General Court of the European Union on September 3, 2025, dismissed Zalando SE's challenge against its designation as a very large online platform under the Digital Services Act. The Berlin-based fashion retailer exceeded the 45 million monthly active user threshold with more than 83 million recipients, triggering enhanced regulatory obligations.

According to the court decision, Zalando's platform qualifies as an online platform specifically through its Partner Programme, where third-party sellers market products alongside Zalando's direct retail operations. The Commission's original designation on April 25, 2023, established Zalando among seventeen entities subject to additional Digital Services Act requirements, including consumer protection measures and illegal content monitoring.

The ruling clarifies technical distinctions within Zalando's business model. Direct sales through Zalando Retail do not constitute hosting services, since the platform stores only its own information rather than content from service recipients. However, the Partner Programme creates hosting relationships by storing and disseminating third-party seller information, including product names, descriptions, and photographs.

Platform metrics determined the designation outcome. Zalando argued that only 30 million users engaged with Partner Programme content, based on gross sales values generated through third-party transactions. The Commission maintained that distinguishing exposure levels among platform users proved impossible, leading to the broader 83 million figure for regulatory purposes.

The court examined Zalando's presentation methods for Partner Programme products. Certain items sold by both Zalando and third-party sellers displayed uniform product pages regardless of seller identity. Consumers only learned seller information after selecting specific product specifications, such as clothing sizes. This integrated approach prevented accurate separation of direct versus third-party exposure.

Digital Services Act obligations now apply to Zalando's entire platform operation. Enhanced requirements include systematic risk assessments, content moderation transparency, external auditing, and researcher data access provisions. The regulation aims to address illegal content dissemination and dangerous product marketing through large platforms reaching significant European populations.

Zalando challenged the designation on legal certainty, equal treatment, and proportionality grounds. The court rejected these arguments, emphasizing that marketplaces facilitate dangerous or illegal product marketing to substantial population segments when serving 45 million or more monthly recipients. The threshold represents 10 percent of the European Union's population.

The fashion platform's legal team included R. Briske, K. Ewald, L. Schneider, and J. Trouet, with support from Bundesverband E-Commerce und Versandhandel Deutschland eV (bevh). The European Commission defended through L. Armati, L. Wildpanner, and P.-J. Loewenthal, supported by European Parliament representatives.

Technical enforcement mechanisms under the Digital Services Act create compliance complexities for designated platforms. German court rulings demonstrate how platforms face liability challenges when addressing trademark violations and content moderation requirements. The Düsseldorf Regional Court's January 15, 2025 decision in Skinport v Google Ireland Limited established precedents for platform responsibility under DSA frameworks.

Zalando's business operations span multiple European markets through its established platform serving over 50 million active customers across 25 countries. The company offers access to more than 6,000 lifestyle brands while maintaining partnerships with third-party sellers through the Partner Programme structure that triggered regulatory designation.

Review manipulation concerns affect platform operations across Europe. German businesses systematically exploit Digital Services Act notification mechanisms to remove unfavorable reviews, creating artificial rating inflation that undermines consumer trust in platform review systems.

The court ruling arrives amid broader regulatory developments affecting digital platforms. European Commission data reveals 35 percent success rates for content removal challenges across major platforms, with 16 million decisions challenged by users during the second half of 2024.

Platform designation criteria require averaging monthly active recipients over six-month periods, calculated through exposure to information from service recipients. The methodology ensures stable measurements while preventing manipulation through temporary user base fluctuations.

Content moderation obligations extend beyond traditional hosting services. Very Large Online Platforms must implement transparency measures including algorithmic accountability, risk assessments addressing systemic threats, and user rights protections through procedural safeguards.

Zalando's Partner Programme facilitates third-party seller integration while maintaining platform control over product presentation. The system enables sellers to provide product information that Zalando checks for commercial compliance, occasionally modifying or supplementing seller content without altering its third-party origin.

The ruling establishes precedents for marketplace platform classification under European digital regulation. Multi-sided platforms combining direct sales with third-party marketplaces face designation based on their hosting functions rather than retail operations, creating regulatory clarity for similar business models.

Enforcement mechanisms enable Commission oversight of designated platforms through transparency reporting requirements, external auditing processes, and potential financial penalties. Companies face fines up to 6 percent of global annual turnover for Digital Services Act violations, creating substantial compliance incentives.

Consolidation trends affect European e-commerce platforms as regulatory compliance costs influence market dynamics. Zalando's December 2024 agreement to acquire About You for 1.2 billion euros demonstrates how platforms seek scale advantages amid increasing regulatory requirements.

Platform obligations include systematic risk mitigation addressing illegal content, fundamental rights impacts, and societal consequences including election integrity and public discourse effects. Assessment requirements cover algorithmic systems, content moderation practices, and advertising policies affecting user experiences.

The case represents the first major judicial review of Digital Services Act designation decisions. Two months and ten days remain for potential appeals to the Court of Justice, limited to legal questions rather than factual determinations about platform characteristics or user counts.

Implementation complexity affects platform operations across multiple jurisdictions. Age verification requirements arriving in 2026 will layer additional compliance obligations onto existing Digital Services Act frameworks, creating overlapping regulatory requirements for major platforms.

Consumer protection objectives drive Digital Services Act enforcement priorities. Platform transparency requirements enable users to understand content moderation decisions, appeal removal actions, and access researcher data for public interest investigations into platform impacts on democratic processes.

Business model implications extend beyond compliance costs to operational modifications. Platform architecture decisions, content management systems, and user interface designs must accommodate regulatory requirements while maintaining commercial functionality and user experience standards.

Timeline

• October 19, 2022: Digital Services Act enters into force across European Union
• April 25, 2023: Commission designates Zalando and sixteen other platforms as Very Large Online Platforms
• January 15, 2025: Düsseldorf court ruling establishes DSA platform liability precedents in Skinport v Google case
• August 28, 2025: European Commission dismisses censorship claims around Digital Services Act enforcement
• September 3, 2025: General Court dismisses Zalando's appeal against platform designation
• December 11, 2024: Zalando announces 1.2 billion euro acquisition of About You platform

Summary

Who: Zalando SE, the Berlin-based fashion platform, challenged its designation as a Very Large Online Platform, supported by German e-commerce association bevh, against the European Commission and European Parliament.

What: The General Court dismissed Zalando's appeal against its Digital Services Act designation, confirming obligations for platforms serving more than 45 million monthly users to implement enhanced content moderation, transparency reporting, and consumer protection measures.

When: The court issued its judgment on September 3, 2025, following the Commission's original designation on April 25, 2023, under Digital Services Act provisions that became fully operational on February 17, 2024.

Where: The case proceeded through the General Court of the European Union in Luxembourg, affecting Zalando's operations across 25 European markets where it serves over 50 million active customers.

Why: Platform designation triggers enhanced Digital Services Act obligations to protect consumers and combat illegal content dissemination, with Zalando's 83 million monthly users exceeding the regulatory threshold representing 10 percent of EU population.